INTRODUCTION: The promise of the Internet to extend the reach of libraries and museums to new users, and to serve traditional users in new and more compelling ways, has pushed many cultural heritage institutions into the new territory of digital programming.

Along the way, museums and libraries have discovered that digital distribution is transforming not only the ways in which their collections are used but also the institutions themselves. Among those organizations convinced that digital technology offers new ways of fulfilling their core missions of education, research, and cultural enrichment, the question of what to put online and how to sustain digital collections is hotly debated.

In February 2001, the Council on Library and Information Resources (CLIR) and the National Initiative for a Networked Cultural Heritage (NINCH) convened a meeting to discuss how museums and libraries are building digital collections and what business models are available to sustain them. A group of museum and library senior executives met with business and legal experts, technologists, and funders to discuss the challenges that cultural institutions face when putting collections online and to identify some models for sustainability that support the core missions and do not conflict with the internal cultures of nonprofit entities.

The meeting was supported by the Institute of Museum and Library Services (IMLS), which had also sponsored a meeting that CLIR convened with the Chicago Historical Society in October 1999. At that meeting, reported in Collections, Content, and the Web (CLIR 2000), library and museum experts cited several areas of mutual concern and called for further discussion of them among the two communities. More specifically, they wished to explore how to

    * develop sound selection criteria
    * identify online audiences and assess user satisfaction
    * manage intellectual property rights
    * develop and share best practices for a variety of technological issues
    * implement cost-recovery strategies consonant with institutional culture
    * manage the institutional transformations wrought by new technologies

The 1999 meeting brought together many individuals who had varying degrees of experience with putting collections online. That agenda focused on collections, audience, and technology. By February 2001, a great deal had changed. The dot-com boom had waxed dramatically and was just as dramatically waning. The quality and quantity of institutional experience with the Web had changed significantly. Technology per se had receded as a pressing issue, eclipsed by concerns about copyright, funding, and fundamental questions about the transformation of institutions, staff, and even missions. Participants wanted to learn from those institutions that had gone beyond project-based experimentation to develop self-sustaining enterprises. They also wanted to hear from representatives of Web-based educational and cultural enterprises that had developed models for sustainability. CLIR and NINCH invited several Web enterprises to present their business models to the group. The speakers were asked to focus on issues of the greatest interest to the cultural sector and to identify those elements of their business plans that are suitable for libraries and museums.

This report summarizes the information shared by presenters and the discussions that ensued among participants. On the basis of the day's discussions, the group was asked to propose an agenda for action; these recommendations appear at the end of the report. Not surprisingly, the discussions kept coming back to two of the central economic and societal questions of this time: Who owns scholarly output and cultural heritage? Who has a right to access it and under what conditions? While not answering those questions definitively, participants were able to examine them in the context of a new information landscape and to consider how these questions affect our institutions' futures.

CLIR is grateful to NINCH for its vision helping us develop a thought-provoking agenda and bringing together key participants from the museum and academic communities. We thank the National Gallery of Art in Washington, D.C., for serving as the site for the meeting. Special thanks are due to IMLS, which generously supported the conference for the purpose of continuing the conversation begun in 1999 in Collections, Content, and the Web and encouraged us to expand the conversation by including a wider range of institutional participants.

Abby Smith
Council on Library and Information Resources

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ISBN 1-887334-85-8
Published by:
Council on Library and Information Resources
1755 Massachusetts Avenue, NW, Suite 500
Washington, DC 20036
Web site at http://www.clir.org

The Council on Library and Information Resources (CLIR) acts on behalf of libraries, archives, and universities to develop and encourage collaborative strategies for preserving and providing access to scholarly resources.

The National Initiative for a Networked Cultural Heritage (NINCH) is a diverse coalition of organizations created to assure leadership from the cultural community in the evolution of the digital environment.

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Contents:
Introduction .............................................................................................. 1
Presentations of Business Models ......................................................... 3
Projects in Scholarly Publishing ..................................................... 3
JSTOR .......................................................................................... 3
HighWire Press .......................................................................... 5
New Enterprises ............................................................................... 7
International Center for Photography/George Eastman ....
House................................................................................... 7
Questia Media, Inc. ................................................................... 8
Gateway Services .............................................................................. 9
Art Museum Network .............................................................. 9
Fathom ........................................................................................ 11
Discussion ................................................................................................. 12
Recommendations and Next Steps ....................................................... 20
References ................................................................................................. 23
Appendix: Participants ........................................................................... 24

RECOMMENDATIONS AND NEXT STEPS:

In addressing the short- and long-term needs of museums and libraries, participants identified four distinct areas that deserve the greatest attention: the elements of a sound business plan; the elements needed to sustain digital efforts at all types of institutions; interinstitutional issues; and funding.

BUSINESS MODELS
Concerns
• What things can or should be done in the commercial world, and what can or should be done only by mission-driven organizations?
• How do we develop cross-community business models; standardize training; measure institutional readiness?

Next Steps/Actions
• Study costs and benefits of collaboration through case studies.
• Develop criteria that institutions can use to assess their readiness to engage in collaborative digital library or digital museum developments.
• Develop a framework for business planning—a document identifying the components of a business plan, the options available for any component, and the interrelationships of the components.

ELEMENTS OF SUSTAINABILITY
Infrastructure/Institutional Issues
Concerns
• How do we prepare staff members for their new roles?
• How do we turn projects into sustainable programs?
• How do we transform legacy institutions?

Next Steps/Actions
• Host cross-domain discussions about common professional developments, awareness raising, and training needs within libraries and museums. Involve professional associations such as the American Library Association, the American Association of Museums, the Society of American Archivists, and the Museum Computer Network.
• Host a workshop to compare methods for organizational restructuring for large public institutions; then scale this session down to make it useful for other institutions.
• Describe the benchmarks in the transition from project to program in leading to the transformation of legacy institutions.
• Apply rigor to descriptions of what library and museum staff members do; share position descriptions and develop role descriptions rather than job descriptions.
• Examine the role of curators and specialists and develop a profile of e-curatorship.
• Determine the balance between the benefits of income from digital assets and the possibility of eroding the “specialness” of an institution when digital assets become widely available.

Infrastructure/Technical Issues
Concerns
• How do we share best practice between and among libraries and museums?
• How do we develop interoperable systems?

Next Steps/Actions
• Undertake more research on interoperability.
• Map metadata schemes, along the lines of the metadata mapping schemes registry that exists at the United Kingdom Office for Library and Information Networking (UKOLN).
• Share good or best practices through targeted workshops.
• Develop a mechanism for exploring common institutional information architectures internationally.

Users and Audiences
Concerns
• How do we determine the needs and preferences of our users?
• How do we conduct market research and target segments of our audience?
• How do online users interact with virtual collections, and how does this use compare with on-site use?

Next Steps/Actions
• Gather studies of users and nonusers to share with museum and library communities.
• Host a cross-domain meeting (i.e., libraries, museums, archives) to discuss common measures, trends, and related matters.
• Conduct research into the impact of the virtual and real library and museum experiences.
• Conduct applied research on how people expect to interact with digital materials.
• Conduct market research of library and museum users to determine what they want from virtual and real museum and library experiences.
• Adopt a segmented approach to the user population, based on market research.

General Cross-Domain and Interinstitutional Issues
Concerns
• How do we support the needs of small institutions?
• How do we share assets developed at considerable expense by various groups?
• How do we assess the impact of changes in copyright law on how libraries and museums manage intellectual property, and how can we shape the law in ways that reflect our interests in fair use?

Next Steps/Actions
• Reconvene museum and library leaders periodically to discuss changes.
• Consider more involvement by organizations in other countries.
• State the problems facing museums and libraries clearly in nontechnical terms; museums asked libraries to formulate “the green, red, and caution lights.”
• Specify requirements of some of the infrastructure services to be provided at the regional level, e.g., digitization, cataloging, distribution, and preservation.
• Identify governance issues for services and convene groups, including funders, to address them.
• Develop a statement about the larger ecology to which both large and small institutions can contribute.

Funding
Concerns
• How do we educate funders about the issues that are and will be of concern to them?
• How do we help funders incorporate best practices for sustainability in their grant requirements?
Next Steps/Actions
• Convene funders to educate them about the issues facing cultural institutions.
• Encourage funders to incorporate the best practices we have identified into their requirements.

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