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The fresh-faced Swede, who speaks with an American accent, runs the Elsevier division, the world’s largest scientific and medical publisher, and his message is that once you stop worrying about prices, his business can help to change the world for the better.
Engstrom joined Elsevier, home to the 183-year-old medical journal The Lancet, two years ago, at a crisis point. Libraries, the main customers, were complaining that the company planned to jack up subscriptions above the rate of inflation at a time when their budgets were squeezed. Political hostility and a House of Commons inquiry led to Ian Gibson, chairman of the science and technology committee, accusing publishers such as Reed of “ripping off the academic community” .
Two years on, the critics are muted. Engstrom has managed to take some of the heat out of the issue — and starts by offering sympathy. “We understand that libraries face significant budget challenges as research output has been rising faster than library budgets. In response to this, we have redoubled our efforts to work with libraries to develop flexible purchasing options.”
That kind of vague, well- intentioned talk won’t, in isolation, convince anybody, but the company has realised that there is plenty of growth to be achieved by means other than price rises. And here, old age is critical. Elsevier’s health sciences division, which accounts for 45 per cent, grew by 6 per cent last year, while the science arm — the balance of the business — improved by plus 5.
“We are fundamentally in a growth market. The ageing population in the Western world is driving an increase in spend on tools to help professionals.”
Examples of what Engstrom means are MD Consult and First Consult, electronic research offerings that provide advice for doctors at the point of care. They are proving particularly popular and the group plans further launches in this area.
The group will soon launch Pathology Consult, an electronic research tool created “by pathologists for pathologists”. Elsevier worked with 500 pathologists and asking them what research facilities would prove useful. The program features 10,000 images — far more than you would be able to display in a paper publication. The group is planning to “branch out” and offer e-research tools to other specialist areas in the medical profession, providing databases of information on hand to meet the needs of increasingly demanding patients.
Further growth is coming from an increased demand for electronic publications. The Lancet itself had ten million downloads in 2005 — giving it the popularity, if not the trendiness, of a digital music service.
The medical profession is becoming more tech-savvy, according to Engstrom, but he said that students, surprisingly, still prefer the paper option — old-fashioned textbooks.
Now the Swede wants to use well-known brands to create niche versions to appeal to certain parts of the medical profession, such as The Lancet Oncology. The same has been done with Gray’s Anatomy, where the content has been adapted to create titles, such as Gray’s Anatomy for Students.
In other respects, though, Engstrom doesn’t have to worry. The human body is the same the world over and so health publications do not need to be dramatically revised for different markets.
“Medical research is universal and all we need to do is translate the text.” Although, Engstrom adds, it can be more complex than that: “Nurses in the UK have different responsibilities than in the US, for example, so we have to adapt services to suit local needs.”
Like many Western companies, Elsevier is making an impact in emerging markets such as China, where people want access to the latest technology and the best medical care. This week, Research in Motion launched its BlackBerry device in China and Google raised its profile there with the launch of a Chinese-language brand name.
Engstrom’s strategy appears to make sense and, once your get past the pricing argument, Elsevier is producing a valuable service to the world. It is, after all, questionable whether it is the group’s job to worry about pricing when its main responsibility is to its investors.
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