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Executive Summary

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TABLE OF CONTENTS

Executive Summary

Business Information in the UK

INTRODUCTION

STRATEGIC SEGMENTATION OF BUSINESS INFORMATION

BUSINESS USAGE

MARKET SIZE AND TRENDS

MARKET SEGMENTATION BY DELIVERY

MARKET SEGMENTATION BY INFORMATION PROVIDER

CURRENT ISSUES FACING THE INDUSTRY

Table 1.1: Segmentation of the Business Information Market by Broad Definition ( percent), 1991-1995

Table 1.2: Segmentation of the Business Information Market by Narrow Definition ( percent), 1991-1995

Figure 1.1: The Role of Business Information, 1996

Table 1.3: The Uses of Business Information, 1996

Table 1.4: Price Points of the Main Types of Business Information, 1996

Table 1.5: Companies Supplying Business Information, 1996

Figure 1.2: Market Segmentation by Type of Research and Data, 1996

Figure 1.3: The UK Business Information Sources by Market Position, 1996

Figure 1.4: Pattern of Information Usage, 1996

Table 1.6: Annual Expenditure on Information Per Company ( percent), 1995

Table 1.7: Information Provider Considered the Most Important by Information Library Customers, 1994

Table 1.8: Approximately What Value Do You Assign to Information on Your Customers, Markets and Competitions? ( percent), 1995

Table 1.9: Key Results of the European Information Industry Association Survey (£m), 1991 and 1992

Table 1.10: Subject Analysis of European Electronic Information Sources (£m and percent), 1991 and 1992

Table 1.11: Subject Analysis of European Electronic Information Sources (£bn), 1995

Table 1.12: EU: Distribution of On-Line Revenues (£m and percent), 1991 and 1992

Table 1.13: Electronic Information Service Revenues (billion ecu), 1988-1992

Table 1.14: The UK Business Information Market by Broad Definition (£m), 1991-1995

Figure 1.5: The UK Business Information Market by Broad Definition (£m), 1991-1995

Table 1.15: The UK Business Information Market by Narrow Definition (£m), 1991-1995

Figure 1.6: The UK Business Information Market by Narrow Definition (£m), 1991-1995

Table 1.16: The UK Commercial Hard Copy Business Information Market (£m), 1991-1995

Table 1.17: Breakdown of the Commercial Hard Copy Market by Type of Information (£m and percent), 1991-1995

Table 1.18: Breakdown of the Official Business Information Market (£m), 1991-1995

Table 1.19: On-Line Revenues (£bn), 1988-1995

Table 1.20: The UK Business Information On-Line Market (£m), 1991-1995

Table 1.21: The UK Electronic Business Information Market (£m), 1991-1995

Table 1.22: UK Electronic Business Information Market by Type of Information (£m and percent), 1991-1995

Table 1.23: Breakdown of General Business Electronic Information by Type (£m), 1991-1995

Table 1.24: The UK Market Research Services Market (£m), 1991-1995

Table 1.25: Business Information Supplied by Management Consultancies (£m), 1991-1995

Table 1.26: Total Business Press Revenues (£m), 1991-1995

Table 1.27: Total Trade Magazine Revenues and Circulation (£m and million copies), 1991-1995

Table 1.28: The Business Newspaper Market (£m), 1991-1995

Table 1.29: Total Turnover of Business Publications (£m), 1991-1995

Market Research Services

INTRODUCTION

KEY INFORMATION PROVIDERS

BUSINESS USAGE

CURRENT ISSUES

Table 2.1: The UK's 20 Largest Market Research Agencies (£m), 1994

Table 2.2: Financial Profile of Taylor Nelson AGB PLC (£m), Year Ended 31st December 1991-1995

Table 2.3: Financial Profile of NOP Research Group Ltd (£m and number), Year Ended 30th June 1991-1995

Table 2.4: Financial Profile of Research International PLC (£m), 1992-1994

Table 2.5: Financial Profile of Millward Brown International PLC (£m and number), 1992-1994

Table 2.6: Financial Profile of BMRB International Ltd (£m and number), Year Ended 31st December 1991-1994

Table 2.7: Financial Profile of RSL - Research Services Ltd (£m and number), Year Ended 31st December 1991-1994

Table 2.8: Financial Profile of Market & Opinion Research International Ltd (£m and number), Year Ended 31st December 1992-1995

Table 2.9: Financial Profile of CACI Ltd (£m), Year Ended 30th June 1992-1995

Table 2.10: Financial Profile of Broadcasters' Audience Research Board Ltd (£m), Year Ended 31st July 1992-1995

Table 2.11: Other UK Research Agencies, 1996

Table 2.12: Breakdown of Association of Market Survey Organisations Member's Revenues by Activity (£m and percent), 1994

Table 2.13: Breakdown of Association of Market Survey Organisations Members' Revenues by Industry Sector of Client ( percent), 1993 and 1994

The Business Press

INTRODUCTION

KEY INFORMATION POROVIDERS

BUSINESS USAGE

CURRENT ISSUES

Table 3.1: Turnover of Pearson PLC's UK Business Information Interests (£m), Year Ended 31st December 1994 and 1995

Table 3.2: Other Publishers, 1996

Table 3.3: Breakdown of Display Advertising Revenues ( percent), 1995

Table 3.4: Which General Business Periodical is Used Most in Hard Copy? ( percent), 1994

Business Report and Directory Publishers

INTRODUCTION

KEY INFORMATION PROVIDERS

BUSINESS USAGE

CURRENT ISSUES

Table 4.1: Other Major Business Publishers, 1996

Table 4.2: Hard Copy UK Company Directories Used in Library/Information Departments ( percent using), 1994

Table 4.3: The Most Popular Company CD-ROMs ( percent), 1994

Table 4.4: Market Research Reports Used by Library/Information Departments in All Formats - Print, On-Line and CD-ROM ( percent), 1994

Table 4.5: Major European Credit Rating Databases, 1996

Official Business Information

INTRODUCTION

KEY INFORMATION PROVIDERS

BUSINESS USAGE

CURRENT ISSUES

Table 5.1: Companies House Key Statistics (000), Year Ended March 1991-1995

Table 5.2: The Main Official Business Information Providers, 1996

Other Information Sources

INTRODUCTION

KEY INFORMATION PROVIDERS

BUSINESS USAGE

Table 6.1: Examples of Trade Associations Which Provide Publicly Available Business Information, 1996

Table 6.2: The Main Chambers of Commerce, 1996

Table 6.3: Some Major Conference and Exhibition Organisers, 1996

Table 6.4: Breakdown of MCA Revenues by Industry Classification of Client (£m and percent), 1995

Information Delivery

INTRODUCTION

THE KEY DELIVERY SYSTEMS

DISTRIBUTION BY RETAIL CHANNEL

KEY INFORMATION DELIVERERS

BUSINESS USAGE

USAGE OF ELECTRONIC INFORMATION

RECENT ISSUES

Table 7.1: The Methods of Data Delivery for Hard Copy, 1996

Table 7.2: The Methods of Data Delivery for Electronic and Other Sources, 1996

Table 7.3: Estimated Breakdown of the UK Business Information Market by Delivery System ( percent of value sales), 1991-1995

Figure 7.1: Estimated Breakdown of the UK Business Information Market by Delivery System ( percent of value sales), 1991 and 1995

Table 7.4: Estimated Distribution Channels for Business Information ( percent of value sales), 1991-1995

Table 7.5: Breakdown of Turnover of Reuters Holdings PLC by Product Category (£m), Year Ended 31st December 1993-1995

Table 7.6: Other Hosts, 1996

Table 7.7: Leading Information Services and Brokers, 1996

Table 7.8: Which On-Line Host is Most Heavily Used in Your Library/Information Department? ( percent), 1994

Table 7.9: Breakdown of Number of CD-ROM Titles Possessed ( percent), 1994

Table 7.10: Major Corporate Changes, 1993-1995

The Future

THE INFORMATION AGE

EMPLOYMENT, EDUCATION AND TRAINING IMPLICATIONS

DIVERSITY AND FLEXIBILITY

THE GROWTH SECTORS

HOSTS VERSUS PROVIDERS

FORECASTS

Table 8.1: The UK Business Information Market by Broad Definition (£m), 1996-2000

Figure 8.1: The UK Business Information Market by Broad Definition (£m), 1996-2000

Table 8.2: The UK Business Information Market by Type ( percent), 1996-2000

Table 8.3: The Commercial Hard Copy Market (£m), 1996-2000

Table 8.4: The Commercial Hard Copy Market by Type of Information (£m and percent), 1996-2000

Table 8.5: The UK Electronic Information Market (£m and percent), 1996-2000

Figure 8.2: Change in the Value of the UK Electronic Information Market ( percent), 1996-2000

Table 8.6: The Electronic Market by Type of Information (£m and percent), 1996-2000

Further Sources

ASSOCIATIONS

PERIODICALS

DIRECTORIES

GENERAL SOURCES

HBI UK INFORMATION SOURCES

GOVERNMENT PUBLICATIONS

OTHER SOURCES

COMPANIES PROFILED

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EXECUTIVE SUMMARY

• Acknowledgement

Business information is information which helps a company manage and market itself in a competitive environment. More specifically, it is taken to cover three broad types of information: marketing research information, company information and financial information.

Market planning or research data is the most widely used data in business. Data on the marketplace or markets in which a company operates is central for evaluating a company's promotion and advertising policy, its pricing policy, brand management, new product development and future strategy.

Corporate data is also important, in that knowing what your competitors are doing is also a central function of management, especially when it comes to branding policy and product development. Company information is also important for other management functions such as benchmarking exercises,

i.e. comparing your company's performance against that of its main rivals or the industry, for deciding whether to acquire or merge with a rival. Company data is also central to managing credit risk and for finding customers for businesses operating in the business-to-business sector.

Financial data is used mainly for market trading and for corporate treasury activities. For the financial services industry, financial market information such as stocks and shares prices is basic market data.

In this report, two definitions of the business information market are used: a broad and a narrow definition, excluding information sources which, although used as business information, have major non-business or non-informational uses such as trade magazines, trade newspapers and financial electronic information.

Under the broad definition, Key Note estimated that the UK business information market was worth £3bn in 1995, having grown by 11.6 percent in the year. Since 1991, the market increased by 58.9 percent. In contrast price terms, the market rose by 7.8 percent in 1995, and by 42.3 percent between 1991 and 1995. Under the narrower definition of the business information market, the UK market was valued at £1.7bn in 1995, having risen an impressive 16.2 percent in the year. Sales between 1991 and 1995 increased by 74.8 percent. In constant price terms, the market rose by 12.2 percent in 1995 and by 56.5 percent between 1991 and 1995.

Key Note estimated that commercial hard copy information was worth £1.8bn in 1995. Three sectors dominate this market: trade magazines, market research data and directories. The total UK electronic business information market was worth £1.1bn in 1995, with off-line services and products having grown rapidly since 1991. The bulk of electronic revenues are generated by financial company data, with market data taking around one-third of the market.

According to the broad market definition, the largest sector of the UK business information market is market data, including items like trade magazines and newspapers, a considerable proportion of whose output is market orientated.

In general, there are three functions to consider in the market:

* information content providers -- the organisations which provide the intellectual property which forms the basis of an information product or service

* information delivery -- the communications channels such as on-line databases, CD-ROM, bookshops, or direct mail operations, which are used by information content providers to distribute their products and services, and by users to access these services

* information processing -- the hardware, software and communications equipment required by users in order to view and process information and by information content producers in order to develop and design their services.

In this report, the first two are studied in detail, and most attention is paid to the information providers. It is generally accepted that the highest level of value resides with the information content provider.

A wide range of organisations supply business information, ranging from specialist commercial organisations to companies supplying information free as a means of promoting their own commercial interests. Newspapers/journals are the most widely used information source and hence, the Financial Times is considered the most important provider of information in the UK.

In the world of business information, you get what you pay for. The more probing and specialist a piece of information is, the more the client can expect to pay. In general, primary research costs more than secondary information. The main exception to this is original research produced by official governmental sources, such as the Office for National Statistics (ONS) --formerly the Central Statistical Office (CSO) and the Office for Population Censuses and Surveys (OPCS) -- and from certain trade associations. In both cases, primary research is produced not largely for commercial sale, but as a means of aiding official or industry monitoring of developments.

The customer base for business information is all UK businesses and related bodies, such as government departments and non-profit making bodies such as universities and charities.

In general, business information is used by two distinct groups of users: end users and intermediaries. In most corporations, corporate librarians or information officers are responsible for buying most secondary information, although the decision to join and use a trade association's information will normally be taken at board level. Market research managers tend to be responsible for buying primary market research.

In the information age, information has become a valuable asset. It is particularly true in today's environment that knowledge is power and, given internal organisational politics, hoarding information can enhance the power of those in control of the information. Information hoarding is commonplace in businesses and is a potentially serious problem. Information hoarding tends to waste management time and reduce business efficiency. Many managers see the information held on customers, competitors and markets as their most valuable asset and around half of managers think it is more valuable than their trade names and trade markets. Key Note estimated that on average, UK companies value their information at around £850,000 per company.

The market for business information is becoming increasingly crowded, especially as electronic access to basic data becomes more widely available. In response to increased competition, information providers are starting to focus on adding value by combining other types of information with the basic data, developing new interfaces and customising delivery options, extending their coverage to other business areas and countries, and by improving the quality of data and business analysis in their hard copy and electronic products.

The Governments' main data gathering and publishing bodies such as the ONS are forging closer links with private sector information providers (e.g. contracting out of RPI data gathering).

In some areas, notably market research agencies, the business press and directory publishing the industry is becoming more concentrated.

During the course of the last 10 years or so, there has been a gradual shift from print to electronic distribution of business information. Since the early 1990s, sources previously available only in print have also become available on

CD-ROM, and business information providers with existing on-line businesses have diversified into CD-ROM publishing. Print, on-line and CD-ROM remain the principal distribution media for business information, with print still dominating for the distribution of local and regional information, and electronic media growing rapidly in national and international information provision.

In 1995, Key Note estimated that hard copy methods of delivery still accounted for around 64 percent of the UK business information market. Electronic methods, principally on-line databases, accounted for 36 percent. Off-line electronic methods, such as CD-ROM and fax-back services, accounted for 6 percent of the market, although their share is growing and is now taking share from on-line systems.

Business information is delivered to the end user (or to the intermediary user) by four methods: direct sales from provider to user; sales via standard distribution channels (e.g. sales via bookshops); sales via value-added distribution channels (e.g. via information brokers or on-line data bases); distribution via channels of `free' access (e.g. libraries and the Internet).

Direct sales are widely used in the business information market and listing in trade directories, word-of-mouth recommendation and a high profile are essential for generating business.

In general, value-added channels are growing in importance, while retail is declining. Direct channels are also slowly losing share of the market, although in 1994, direct channels took a greater share of the market than in 1993. This reflected the rebound in the information market after the effects of the recession. Electronic, value-added channels had weathered the recession better than hard copy and direct channels.

The latter part of the 1990s and the early years of the next century will see the establishment of the `information age'. Information is now a valuable and tradable commodity and organisations which make best use of the information available will be those which will prosper. The use and availability of information is set to expand, with the mobility and access to information being key commercial and economic issues.

Three elements will be essential for future success in the information market: the ability to offer value-added data; ability to supply information on a range of delivery media; ability to present data attractively and in user-friendly ways.

A feature of the 1980s was the power that the on-line hosts held over the hard copy information providers. If the 1980s and early 1990s were the ages when service companies held the power, in the late 1990s and into the next century, it will be the content providers, i.e. the information providers, who will hold the power in the market.

Between 1996 and the year 2000, Key Note expects the business information market by the broad definition given in this report to grow by 44.5 percent at current prices, or by 28.3 percent at constant 1995 prices. This results in an annual average rate of growth for the market of 9.6 percent in nominal terms, or 6.4 percent in real terms.

Key Note expects to see a continued shift in the market towards electronic information sources, although hard copy will still account for more than 60 percent of the market by the year 2000. The structure of the electronic market will change, with off-line services growing faster than on-line. However, on-line will continue to dominate and will still account for 76.5 percent of the electronic sector in the year 2000.

In terms of the type of information provided, the market will shift in favour of general business information in the next 5 years and away from purely financial data.

Acknowledgement

Key Note would like to thank all those who contributed company information during the compilation of this report.

Text © 1996 Key Note

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