Information Industry

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INFORMATION INDUSTRY

The information industry comprises a group of enterprises and organizations whose purpose is to produce and process information and to develop the infrastructure and delivery mechanisms to distribute information. For the individuals and companies that implement these functions, it is important to understand the nature of the industry and the issues that affect its activities. For the people and organizations that use information, it is helpful to develop an understanding of the larger picture of the industry as a whole so they know where to find the information they need and how it is being made available.

Information as Product

The definition of "information" that will be used in this entry is that of Michael Buckland (1991), which regards information as objects. Information objects include things such as databases, electronic documents, newspapers, books, and calendars. Information is thus something that can be produced, sold, delivered, and used. In order for these activities to happen, however, some aspects of the nature of information objects must be properly understood.

Information as a product must be used in some way (e.g., read, understood, and applied) in order for its value to be realized. Unlike goods such as food, information cannot be consumed; once it is used, it can still be used again. Information also has a lifecycle; it moves from new to old, from specialized to general, and from contested to accepted. All of these aspects of information affect its value as a product, from the perspectives of both the information buyer and seller. The value of information is sensitive to time; new information may cost more to deliver than old. For a buyer, information that is needed by the end of the day may be worth nothing if it is delivered the following day. Value is also affected by the strength of the need for information; finding an emergency room patient's medical history may have a different perceived value to the customer than answering a crossword puzzle clue. The value of information is also related to a number of factors such as its scarcity or proprietary nature, the cost to produce or assemble the information, and the effect it will have when used. All of these factors affect how the information industry creates, prices, and delivers information to consumers. These factors also affect the willingness of the consumer to purchase and use the information. For a clearer understanding, though, it is useful to examine the specific functions that are required for industry to handle information as a product.

Functions of the Information Industry

The functions of the information industry can be separated broadly into four categories: production, processing, distribution, and the building of infrastructure.

Many of the producers of information fall outside the bounds of the information industry proper; these include authors, illustrators, inventors, and so on. However, information is also produced within the industry itself; for example, companies specializing in data mining use large collections of data to create usable information products such as customer profiles or product purchasing trends. Also, some of the products generated in the processing of information are sufficiently novel that processing becomes a form of production.

Information processing comprises a large portion of the activities within the information industry; processing transforms information into products that can be packaged and sold as usable goods. For example, publishing a journal involves processing a number of articles into an edited and integrated package. Creating an electronic database of journal articles involves assembling citations and abstracts for articles from a carefully selected group of journals and integrating them into a large, usable database system.

Distribution of information also comprises a large part of industry activity; distribution includes marketing the information products that were processed and delivering the products to the customers who purchase them. For example, once an electronic database of journal articles has been assembled, proper distribution ensures that potential customers know it exists and that they can access it after purchase. When the product is delivered to the customer, that individual might be a librarian or other information professional. This person, who then distributes information to specific information users, is often called an "intermediary." For nonprofit segments of the information industry, such as libraries, this may be referred to as "access"; rather than delivering information products to customers, they are making them available to people for their use.

Finally, information industry organizations must build a robust infrastructure in order to support their activities. Such an infrastructure may include, for example, computer hardware and software, database systems, telecommunications systems, marketing channels, and other technological and social structures. An important piece of infrastructure that has had a great effect on the information industry is the Internet; this widely available and standardized means of transferring electronic information (including text and graphics) has allowed organizations to move away from proprietary, dedicated delivery systems and toward integrated, multiproduct, multivendor access to electronic information products.

The four activities of the information industry do not operate in a vacuum; rather, they are the means by which information companies provide goods and services that meet customer needs. In doing so, the information industry plays a number of roles. For example, the information industry attempts to reduce information overload; people and companies that use information perceive that they receive too much information. To compensate, the information industry processes large amounts of information, reducing it to smaller, categorized packages that can be distributed to information users. The information industry also helps facilitate access to information; information users often have difficulty in obtaining information, whether they know what information they need or not. To make getting information easier, the information industry processes information into packages that people will understand and want to use, makes users aware of the existence of these efficient packages, and ensures that information products work properly and are timely and accurate.

The variety and complexity of the functions undertaken by the information industry lead one to wonder about who performs such tasks. Successful accomplishment of these activities requires specific kinds of organizations and specialized jobs.

Roles within the Information Industry

Individuals and companies that perform production functions work primarily to change large amounts of raw data into information. In data mining, for example, very large stores of data are manipulated and examined in order to generate reports and profiles that identify and explain broad trends. Surveys, censuses, and other types of data collection do similar things on a smaller scale; numerical data are gathered and the results tabulated. In addition, data are changed into information by being arranged into databases. There are other kinds of information production such as authoring and illustrating; these creative processes generate information objects such as books and journal articles.

Those people who are involved in information processing perform tasks that change information objects into organized collections or packages that are suitable for distribution. One important task is publishing, which can mean aggregating articles together to form a coherent journal or editing and assembling a book. Once information has been published, a second level of processing takes place, which places documents or their representations into organized forms. For example, indexers and abstracters generate standardized citations of documents and write summary abstracts of the content. These citations and abstracts can then be assembled in large, searchable document repositories. To help make these repositories easy to use, catalogers or subject analysts use standardized methods of arranging documents by subject and describing their content.

Once information has been packaged for distribution, many different people help transfer information from the producer to the customer. Marketing lets customers know that information resources exist, how they may be useful for the customer, and in what ways one product may be more suitable than another. Suppliers and database resellers act as "wholesalers"; for example, they may repackage a number of databases from different producers into one new product or provide a gateway to electronic journals from a variety of publishers.

The form of distribution in which an information professional acting as an intermediary uses the packaged product to provide information to end users can take several forms. A library is a repository where information is collected, organized, and made accessible to users; the librarian is responsible for selecting items, organizing them within the library's own collection, or helping people with information needs to find answers. Some distributors do not collect items; they pay to access a wide variety of resources and employ people who are expert in using them. For example, information consulting or information-on-demand services are hired by customers who have specific information requests. Such companies fulfill the requests, using perhaps many libraries and database services, and sell the results to the customers. Similarly, document delivery services do not collect materials; they use a number of information resources to provide articles or books on request.

Many different individuals and companies are involved in creating information infrastructures. In building the technical components, telecommunications companies provide the wiring and the communication systems that allow for the transfer of data. Internet service providers (ISPs) provide the means for individuals to access telecommunication systems. Software programmers, software engineers, systems analysts, and database designers build databases and other information systems that provide a framework for information objects and their representations. Finally, interface designers ensure that customers can interact successfully with the electronic information systems.

Equally important is the sociological infrastructure. For the sharing, transferring, and repackaging of information to occur, it must be in standardized electronic forms that move over standard communication channels. Standards must be designed and developed, but they must also be implemented when systems are built. The sociological infrastructure also provides help and support to people who are using information products and may need assistance in operating the system. Usually, telephone technical support workers and technical manual writers provide this assistance.

The information industry also includes people who manage these functions, whether or not the sole product of the organization is information. Knowledge managers, information technology managers, and other types of information managers work in organizations ranging from manufacturing companies to universities to hospitals to banks. These roles combine business knowledge with an understanding of the functional processes of information management to provide an in-house information industry for the organization.

Given the wide variety of people and organizations that are working in the information industry, along with the profound shift caused by electronic information and telecommunications systems, it is inevitable that the information industry should face many issues. An examination of some of these issues will provide a greater understanding of the state of the industry and its future.

Issues and the Future

As the information economy becomes increasingly global, there are a number of factors that affect the use and transmission of information. The global environment is characterized by extreme fluidity; contexts of information use change continually. The information to be shared is heterogeneous in language and in content; people save, organize, and use information in different language and cultural contexts. Increasing numbers of information sources lead to information overload. In addition, developing global standards for large-scale information sharing is made difficult by the different languages, content, and contexts of global information.

The increase in electronic information gathering, packaging, and selling highlights several kinds of rights management issues. First, personal rights of privacy may be stretched or violated as information-gathering behavior both online and offline is tracked and aggregated. Second, ease of transmission and copying of electronic information makes copyright enforcement difficult. In a global context where copyright laws vary between countries, it is difficult to know what laws should apply. Finally, electronic information objects are subject to different kinds of ownership than are physical objects. While objects can be owned in perpetuity, electronic information is often sold on an access or "right to use" basis, creating difficulty in archiving the information.

Finally, the business models associated with selling information are constantly changing. For example, new payment methods have led to systems where information is paid for not with cash but by the user's willingness to view advertising. The availability of small pieces of electronic information (such as single journal articles or graphics) has led to the development of small transaction aggregation and payment systems. Information companies have been developing joint ventures, strategic alliances, and government partnerships to help adjust to a global information context; often, these alliances are between companies who maintain separate and competing businesses. Finally, as new technologies are developed inside and outside the information industry, those new technologies drive the creation of new information products.

The information industry is in a state of flux in which the only guarantee is constant change. While the functions required to handle information as a product have not changed, the technologies, jobs, and products are quite different than they used to be. Understanding the future of the information industry is to understand the constancy of the functions required, to be aware of the issues that are affecting the progress of the industry, and to realize that the industry flourishes by staying abreast of changes in technology and information use.