Competitive Strategy and Product Development in the Electronic Publishing Industry

© Fionn Ross, 18 August 1999

Introduction

The world of information technology is changing more rapidly and in a more unpredictable fashion than ever before. This not only causes considerable problems in terms of companies' day-to-day operations but it also, more importantly, has enormous implications for their ability to plan for the future and respond to change. This thesis is particularly concerned with investigating the development and execution of strategic plans in the area of educational multimedia.

Strategic planning is the continuous process of systematically evaluating the nature of business, defining its long term objectives, identifying quantifiable goals, developing strategies to reach these objectives and goals and allocating resources to carry out these strategies.

Strategic planning begins by addressing the following three questions:

· Where are we today?

· Where are we going?

· How do we get there?

Strategy formulation must be based on a thorough understanding of the market, competition and the external environment regardless of the planning approach used.

However, since the early part of this century, debate has raged as to how companies should approach strategic planning. The thesis identifies two main schools of thought that have arisen out of this debate: the rational, 'planning' model (also termed the prescriptive approach) as proposed by Ansoff and the 'learning' school (also termed the emergent approach; another term is logical incrementalist) as proposed by Mintzberg. In the light of these two approaches to strategic planning and through the study of the educational multimedia publishing industry the study sets out to examine strategic planning approaches within the industry: are: do they plan rationally, or do they learn from experience. Or, do they combine approaches?

The main focus of the thesis is the examination of strategic planning within the educational multimedia publishing industry and it tests the hypothesis that competition between publishers in new technological products areas is a critical driving force behind the growth strategy in educational multimedia publishing - irrespective of clear or absent/insufficient market research data in this area - and examines the implications for educational multimedia publishing.

Several strategic planning/management tools are available, and, for the purpose of this thesis, Michael Porter's Five Forces Model is used to analyse the current and future state of the educational multimedia industry. In his classic work Competitive Strategy (1980) and the updated The Competitive Advantage of Nations (1990) Porter identifies five basic forces which determine demand and supply in particular commercial and industrial sectors. These are the threat of new entrants; bargaining power of suppliers and buyers; the threat of substitute products and the rivalry between existing firms.

Definitions

In this section, I am seeking to identify, first of all, the definitions of strategy and, secondly, what educational multimedia means within the context of this thesis.

Definitions of strategy

In order to define strategic management itself, one needs to define what strategy is, and the basics of corporate strategy. The word strategy has its roots in the military and comes from the Greek word ‘strategos’ which means ‘to lead an army’. As with many words in the English language, its meaning changed over time to incorporate psychological and behavioural issues as well as the employment of managerial skills to motivate staff to combat and overcome ambiguity. The word has retained its military connotations as is indicated by the Oxford English Dictionary: ‘the art of the commander-in-chief; the art of projecting and directing the larger military movements and operations in a campaign. Usually distinguished from tactics, which is the art of handling forces in a battle or in the immediate presence of the enemy’.

Webster’s New Collegiate Dictionary defines strategy as ‘the science and art of employing the armed strength of a belligerent to secure the objects of a war, especially the large scale planning and directing of operations in adjustment to combat area, possible enemy action, political alignments, etc.’ (author’s emphasis).

The New Collins Dictionary corroborates Webster’s somewhat by defining the word as ‘the art or science of the planning or conduct of a war' (author’s emphasis). Of the three definitions, Webster’s definition could be considered the stronger since it defines strategy both as an art and a science as opposed to one focus or the other.

It is generally agreed that there is no single universally accepted definition and hence writers have tended to focus on highlighting particular elements inherent to the concept (Andrews, 1970; Quinn, 1980; Drucker, 1974; Chandler, 1962). Mintzberg has most comprehensively covered corporate strategy in the 5 Ps: plan, ploy, pattern, position, and perspective. Strategy can be defined according to just one of these terms and yet at the same time implicit acceptance of all these terms is made despite the narrow definition.

Johnson and Scholes (1993) offer a definition based on several characteristics of strategic decision-making:

Strategy is the direction and scope of an organisation over the long term: ideally, which matches its resources to its changing environment, and in particular its markets, customers or clients so as to meet stakeholder expectations.

Definitions of multimedia

The definition of multimedia has changed over the last twenty or so years, although it remains different things to different people. The industry itself is rapidly changing and new opportunities constantly present themselves and this can make it difficult to give multimedia an all-combining single identity. It is precisely this seeming absence of identity that presents problems for effective multimedia marketing. Michael Henry (1994) in his book Publishing and Multimedia Law defines multimedia in market terms and intellectual property terms. For the purpose of this thesis and with particular reference to publishing (as opposed to information technology or television), the following terms apply:

1. Electronic Publishing

Refers to any non-print media material which can be electronically delivered, stored and/or manipulated by the user. The Hutchinson Dictionary of Computing, Multimedia and the Internet (published by Helicon) defines electronic publishing as 'the distribution of information using computer-based media'.

2. Multiple Media Publishing

This refers to publishing on discrete media such as paper, disc, CD-ROM, on-line, etc. Many educational products, such as language courses, are available in print, video, audio-cassette and/or floppy disc or CD-ROM. These are often presented as multimedia products but this is a misnomer.

3. Multimedia Publishing

This is the integration of text, graphics, images, sound, video, etc., on to one medium, e.g., CD-ROM. An example would be Microsoft's Encarta which would not only provide information which can be read as a result of search and retrieval techniques, but also allows the user to play particular video clips relevant to the information being sought.

4. Interactive Multimedia

This is the merging of previously separate media - video, text, audio, graphics and animation - under computer control. It is a combination of electronic publishing and multimedia publishing, where the concept refers to the representation, storage, retrieval and dissemination of machine-processable information, and expressed in multiple media such as text, voice and images. The key word here is 'interactive', where the user is allowed to decide what type of information is required and to navigate through the medium in order to explore it and/or 'arrive' at a 'destination'.

Tony Feldman’s (1997) definition is seen by many in the industry as a sensible one:

Multimedia is the seamless integration of data, text, images of all kinds and sound within a single, digital information environment.

With the converging of the telephone, television and computing...

Definition of educational multimedia

There are various classes of educational multimedia on the market which are a combination of information, education and entertainment, having taken cues from the games market. These are called infotainment and edutainment products. These classifications do not take into consideration the political, prescriptive nature of the products developed for meeting National Curriculum needs. However, they are being incorporated in rather innovative ways into the Curriculum in both primary and secondary schools.

The Learning Software Taskforce in their June 1998 report on the educational multimedia industry in the UK, coined the term ‘learning software’, and defined it as:

· Interactive, digitally-held information-rich content - encyclopaedias, atlases and so on - together with lesson materials and courseware based on it

· Software for pedagogical purposes - primary, secondary, further, higher and lifelong learning

· Personal purchase software for home education.

(Report of the Learning Software Taskforce, CSSA, June 1998)

For the purposes of this thesis, educational multimedia is defined as an interactive CD-based product developed for pedagogical use, specifically within the National Curriculum. These products are designed to fulfil the criteria of the National Curriculum but may also include an element of fun, particularly for products aimed at primary schools. The terms ‘educational multimedia’ and ‘learning software’ are used interchangeably.

Theoretical Framework

The theoretical context for this thesis within the above model is provided by two well known authors’ works in the strategic planning field: Ansoff’s work on the product-market matrix, developed in the classic Corporate Strategy (1979, and updated in 1988), and his emphasis on analysis (particularly gap analysis – the gap between where the company is now and where it wants to be) and synergy; Mintzberg in The Nature of Managerial Work (1973), in which he observed the everyday activities of senior managers and offered telling conclusions to be compared with the limited definitions of managerial functions from the classical and human relations schools, for example, Fayol - to forecast, plan, organisation, command/motivate, communicate, review and control or leadership models which recommend various task and relationships-oriented behaviours. He concluded that far from engaging in intensive strategic planning, managers were more likely to flit from one thing to the next, being ‘creatures of the moment’ and ‘hostages to interruptions’.

This thesis contributes to the rational-emergent strategy debate by providing evidence of a combination of the two approaches adopted by multimedia publishing companies in developing multimedia products.

Literature Review

In this section, I will be providing a critical review of the management literature, starting with a general overview of the evolution of the literature with regard to strategic planning, then juxtaposing these two authors’ ideas and their contributions to the development of the two main schools of thought in strategic management literature. This review will form the basis for the research which seeks to identify whether or not publishers undertake rational, strategic planning as they move into the field of multimedia publishing.

Evolution of Strategic Planning Literature

Strategic planning has come a long way from the early years during which the research focused on administration, the chief tool of bureaucracy, and efficiency (Fayol, 1916; Taylor, 1911). These militaristic and bureaucratic approaches were challenged by Follett (1918) who argued that ‘institutions of ... bureaucracy should be replaced by local groups working together to solve their problems’. Strategic thinking can be divided into three areas:

· Long range planning which originated in the 1950s. It was very popular as a means of attempting to predict future events although it ignored social and political factors, as well as assumed markets would remain stable (Clutterbuck & Crainer, 1990). Long range planning extended the one-year financial plan associated with the early years of the twentieth century (and based on budgeting and control) into five-year budgets and later evolved to include diversification and growth issues (Penrose, 1954; Marris, 1964).

· Strategic planning (1960s to early 70s) with an emphasis being placed on examining strategic options before dealing with budgets. Porter (1987) identifies four major reasons why it became unfashionable: planning was done by planners rather than managers; this resulted in non-implementation of plans; the way in which planning techniques were used was criticised; and issues of culture and total quality management were ignored. There are several main strategic planning tools: the Boston Consulting Group (BCG) growth share matrix, developed by Henderson (1970); directional policy matrices, such as those developed by Shell and General Electric (GE); and Profit Impact of Market Strategy (PIMS), also developed by GE and Ansoff’s growth matrix (1965, 1987).

· Strategic management - the thinking of the 1980s where organisations attempted to understand, select and implement the strategy/ies they would follow, by applying tools and support needed to manage change. Ansoff’s work Strategic Management (1979) established his position as ‘the father of strategic management’ and is concerned with organisational behaviour in ever-changing environments. Other important proponents of strategic management include Porter (1980) and Ohmae (1982). Classic tools used in strategic management include the SWOT analysis, scenarios planning, determining key success factors and Porter’s Five Forces.

To conclude, the period of the 1970s was the era when prescriptive, rational, corporate strategic planning - which this evolution describes - was particularly strong. Further strategic concepts such as generic strategies, were proposed in the 1980s, but the basic traditional process of strategic analysis, choice and implementation formed the best practice of many companies.

Ansoff’s Influential Work on Product Development

Ansoff’s work on corporate strategy (1965) was the result of the belief that all a company had to do ‘was to maximise its strengths and minimise its weaknesses’. However, he also observed that as firms grew more competent at strategy development, they also became more rigid, with the result that strategy implementation (which his 1972 paper on strategic management sought to address) lagged behind trends in the market place and coined the term ‘paralysis by analysis’. While he agrees with critics of his rationalist approaches, he counters the ‘everything-to-be-quantified’ argument by seeking ‘patterns in complexity which can help managers to do their work in the overwhelmingly complex and turbulent world of today and tomorrow’.

Strategic Management (1979) was the result of Ansoff’s extensive research of American companies involved in acquisitions between 1948 and 1968. His conclusion was that companies that acquisitions fared comparatively better with companies that adopted a planned strategy than with those which were more opportunistic.

He was the first to describe the product-market matrix in terms of a company’s attempt to elaborate its business (Mintzberg and Quinn, 1996). This matrix was designed to address companies’ growth strategies whereby they can develop their markets by way of new segments, channels or geographical areas, or through seeking to push the same products to the same markets. It is popular with companies seeking to diversify their activities.

A more detailed discussion of the product-market matrix follows in Section (...)

Henry Mintzberg’s Approaches

Mintzberg was described by a management journal as ‘something of an enfant terrible in the world of management thinking’. Going against orthodox management teaching, he believes that many accepted theories and practices of management are a hindrance to change and innovation. His theories were put forward in Mintzberg on Management, one of a series of major works extolling the importance of what is now termed ‘logical incrementalism’. In this work he argued that the rational approach to managing organisations had ‘driven out intuition, which is a vital element in setting organisation direction and making effective decisions’ (Clutterbuck and Crainer, 1990). In two other works, The Nature of Managerial Work and The Structure of Organisations, Mintzberg developed concepts of different managerial schools and organisational structures based on observations of the ways managers worked as well as the variables affecting organisational structures.

Mintzberg’s typological approach to strategy mirrors his approach to managerial behaviour and organisational structure. His work, Of Strategies, Deliberate and Emergent, which he co-authored with Waters (1985), provides a basic framework where at one end of the continuum, they discuss the prescriptive approach to strategy formulation, and, as they work their way through the different types of strategy, end with the emergent approach to strategy formulation. In his book, The Rise and Fall of Strategic Planning (1994), Mintzberg defines strategy as ‘a pattern in a stream of decisions and actions’. He argues that the strategic planning process so often fails because planning is about analysis and strategy is about synthesis, and concludes that strategic planning did not work, that is, the rationality of planning did not conform to the needs of strategy making. In his work with Waters (1985) a distinction is made between fully realised (deliberate) and unrealised strategies, with the inclusion of emergent strategies, namely realised strategies that were not explicitly intended. In this work, they stress the importance of deliberate and emergent strategies, and the importance of balancing between ‘realising intentions while at the same time responding to an unfolding pattern of action’.

The prescriptive school

The prescriptive school was pioneered in the 60s by writers like Igor Ansoff and Kenneth Andrews. Strategy was conceived as a rational (Peters and Waterman, 1982), sequential or linear (Chafee, 1985) process. A company had to define its objectives, analyse its position, evaluate alternative courses of action, select its strategy and implement it. In this process the ‘thinking’ aspects were kept separate from the ‘doing’ aspects, both in time - through the sequence described above - and in space, through the separation of planning functions (centralised at the top) and operations. It was increasingly important for general management to position and relate the firm to its environment in such a way as to ensure continued success and keep it secure from surprises. Parallels have been drawn with the military of this process. For example, as seen in the early Chinese military historical writings of Sun Tzu; the nineteenth-century German Strategist, Clausewitz; and Captain B H Liddell Hart who wrote about the First World War. All these have been quoted by corporate strategists. The approach is also legalistic and biblical in the sense that rules and regulations are established and adhered to with very little change.

Ansoff (1979) argues that strategy is basically a set of decision-making rules to guide organisational behaviour. It is an abstract concept with no immediate actions, a search process, where objectives represent the ends, and the strategy a means to such ends.

In the 1980s, faced with the reality that too many strategic plans fell victim to organisational inertia, the traditional approach re-invented itself as strategic management. The role of planners was downgraded in favour of line management involvement in an effort to create ‘ownership’ of plans (Turner, 1996).

Advantages of the prescriptive approach have been summarised by Lynch (1997) as follows:

· a complete overview of the organisation

· the possibility of making a comparison with the defined objectives

· a summary of the demands on the resources of the organisation, including people, physical assets, finance and cash flow

· a picture of the choices that the organisation may need to make if resources are limited

· the possibility for the organisation to monitor the agreed plan as it is implemented, so that it can evaluate the progress that is being made.

There are three basic theories that underlie the prescriptive school of thought:

1. Profit-maximising, competition-based theories emphasise the importance of the market place to deliver profits. Lynch (1997) correctly identifies the economic theoretical origins of prescriptive strategic analysis. Adam Smith, writing in the eighteenth century, took the view that human beings were basically capable of rational decisions that would be motivated most strongly by maximising their profits in any situation. The competition-based aspect of the theory stresses the importance of strategy in the search for sustainable advantage. Porter, for example, has translated profit maximisation and competitive warfare concepts into strategy techniques and structure that have contributed to prescriptive strategic practice. Porter suggested that what really matters is sustainable competitive advantage versus competitors in the market place: only by this means can a company have a successful strategy (Lynch, 1997).

2. Resource-based theories stress the importance of the organisation’s resources in strategic development. Core competencies (as proposed by Hamel and Prahalad, for example) need to be identified when balancing organisational strengths and weaknesses. The SWOT analysis, a useful tool advocated by Andrews (1970), seeks to answer the questions: (a) where are our opportunities and threats and (b) how can we capitalise on our strengths and reduce our weaknesses? (Thompson, 1997).

3. Socio-cultural theories focus on the social and cultural dimensions of the organisation in developing its corporate strategy. They have arisen as a result of greater awareness of cultures beyond the Anglo-American mould. It is possible that in some cultures the profit objective may not even be appropriate. This focus is also important for multimedia developers and producers who are entering international markets and therefore need to take issues of localisation into consideration. With respect to the National Curriculum, it is particularly pertinent to US, European, and other companies outside the UK that have entered the UK market. Intra-organisational cultural issues are also important in strategy development. Corporate strategy development is very complex because it involves the entire organisation and its environment. This process is compounded because it cannot be developed in a vacuum since it involves people. Bowman and Faulkner (1997) identify two reasons this complexity exists: each executive involved has his/her own views and motives, which may or may not be explicit; and in deciding strategy, individuals are constrained by their past experiences, taken-for-granted assumptions, biases and prejudices.

The Learning (Logical Incrementalist) School

Those who favour the prescriptive strategic process claim it to be logical, rational and capable of real insight into an organisation’s problems. However, Mintzberg (in Lynch, 1997) presents six major difficulties with the prescriptive strategic process. For example, he argues against the accuracy with which the future can be predicted in order to make realistic, rational discussion and decisions, by saying that competitors or governments (for example) can be unpredictable and thus invalidate the whole prescriptive process. Although he was highly critical of the formality and rigour of the prescriptive process, Mintzberg has in recent years modified his views and accepted to an extent the benefits of formal planning techniques to organisations. Nevertheless, he advocates the importance of the emergent strategy.

Emergent strategies differ from prescriptive ones in that the final objectives are unclear and the strategy’s elements are developed during the course of its life. It is based on the observation that human beings are not always the rational and logical creatures assumed by the prescriptive approach which has been rejected by various commentators such as Mintzberg.

Advantages of the emergent strategy are summarised by Lynch (1997) as follows:

· it accords with actual practice in many organisations (also confirmed by Mintzberg’s work, The Nature of Managerial Work)

· it takes account of the people issues - such as motivation - that make the prescriptive process unrealistic in some circumstances

· it allows the strategy to develop as more is learnt about the strategic situation

· the role of implementation is redefined so that it becomes an integral part of the strategy development process (rather than being separate from it)

· it provides the opportunity for the culture and politics of an organisation to be included in the process

· it delivers the flexibility to respond to changes, especially in fast-moving markets.

Opponents of this school of thought have expressed several concerns. For example, they argue that

it is entirely unrealistic to expect Board members at corporate level to simply sit back and let operating companies potter along as they wish. The HQ consists of experienced managers who have a unified vision of where they wish the group to progress. It may take several steps to arrive at this vision, but the group should make visible progress, rather than just muddling along. (Lynch, 1997)

They argue for allocation, responsibility, the need for evidence and logic, the simplicity and clarity of management control and the benefits of having fixed strategies for lengthy projects.

There are three basic theories that underlie the emergent approach:

1. Survival-based theories of strategy are based on the survival of the fittest in the market place. This is the Darwinist approach which allows for the evolution (emergence) of (unintended) strategies within firms.

2. Uncertainty-based theories of strategy regard prediction as impossible because of the inherently unstable nature of business and its environment. Strategies must be allowed to react to the changing environment and emerge from the chaos of events. Some would regard this as being a pessimistic view of strategy.

3. Human resource-based theories of strategy emphasise the importance of the people element of strategy development. They highlight the motivation, the politics and culture of organisations and the desires of individuals. They also suggest that strategy would benefit from an element of learning and experimentation that empowers individuals.

Several researchers (Chafee, 1985, for example) have used the term ‘adaptive’ to refer to a model for strategic management that describes the learning organisation. The term is also used by Mintzberg (1973) and corresponds to the ‘idea of incremental strategic change’. The entire organisation is considered a process, throughout which it must learn, that is, a learning organisation (Senge, 1990). According to Senge, strategy revolves around coping with the forces of structural conflict, for which three solutions exist:

1. Let the vision erode.

2. Manipulate the conflict and create artificial conflict if one fears failure. In other words, concentrate on what one does not want to happen.

3. Implement a strategy of willpower, focusing on success.

Senge considers a potential definition of strategy as identifying the forces that shape the evolution and the structures that lie behind the forces. Based on this strategy, strategic management takes place within the framework of the learning organisation.

Senge is among the first of the strategists to be concerned with chaos and complexity theory, and the loss of purpose that frequently comes in their wake. He argues that most people feel lost in the organisations of which they are a part. Managers are threatened with information overload, too many rapid changes, and too many conflicting demands. When asked about their work, they tend to ‘describe the tasks they perform every day, not the purpose of the greater enterprise in which they take part. Most see themselves within a system over which they have little or no influence. They do their job, put in their time, and try to cope with the forces outside of their control’ (Senge, 1990).

According to Senge, this systematic inability to cope with complexity is a direct result of traditional scientific approaches to management. Freedman (1992) states that ‘from its opening sentences, The Fifth Discipline [Senge’s seminal work] is an attack on the reductionism at the centre of both Taylor’s system and all of nineteenth century science’. Senge believes that by breaking apart problems, we pay an enormous hidden price, that of no longer seeing the consequences of actions and losing our sense of connection to a larger whole. He argues that ‘the perception that someone up there is in control is an illusion…’

The alternative is to stop seeing the organisation as a machine and to begin viewing it as a living organism. This requires a holistic approach that reflects chaos theory’s focus on the overall behaviour of a system.

Assessment of the prescriptive school

One problem with the prescriptive school of thought is that it lacks tolerance of uncertainty. In the multimedia industry where there is a very high degree of uncertainty and fragmentation, the organisation can only deal with two alternatives at the most in the face of the large amount of data (often conflicting) that is available. This is usually one fixed and one variable. In a volatile, and, therefore, highly uncertain environment, this intolerance is inadequate in dealing with the various marketing and strategic issues.

Another problem perceived with the prescriptive school of thought is the issue of how companies deal with data. While Macarthur and Stone (1994) acknowledge that there are some departments that have competent staff, they also assert that weak/uninformed staff or organisations/departments can result in weak strategies. In order to forecast sales of educational multimedia, there is a realisation that the market is still immature and extremely volatile - as is the nature of immature markets in terms of the amount of conflicting data available - and large publishers in general are now reluctant to invest in something so slow and highly speculative. The main focus of this thesis is the examination of strategic planning within the educational multimedia publishing industry and it tests the hypothesis that competition between publishers in new technological products areas is a critical driving force behind the growth strategy in educational multimedia publishing - irrespective of clear or absent/insufficient market research data in this area - and examines the implications for learning software publishing.

Proposition of thesis

Quinn’s work (1985) contends that ‘major innovations are best managed as incremental, goal-oriented, interactive learning processes’. He observes that most successful managers today permit chaos and replication very early on in the planning stage, but combine this with formal planning techniques and controls while still retaining a flexible approach. It would appear from the above observation that a synthesis of the rational and learning schools of thought is called for. Indeed this is confirmed in Mintzberg’s polemic (1991) on the planning vs learning debate, where he (using rather colourful language) argues for consideration of both approaches in strategy formulation and implementation.

Origins and Development of Electronic Publishing in the UK

Early technological developments

Electronic publishing has its roots in the very first videodisc system called Phonovision invented by John Logie Baird in 1926. Until the 60s, the technology was built on recordable systems developed which were used by sports broadcasters (Hoffos, 1996). Phillips launched its first reflective optical videodisc player in 1977 after demonstrating it the previous year as LaserVision. The 12” disc consisted of varying lengths of laser-etched pits which produced the analogue signal. Each side of the disc held 55,000 indexed TV-quality full motion frames, with a digital capacity of approximately 1 Gb per side. The product was launched in the United States in 1980 (in Europe in 1982) as LaserVision. The BBC launched the Domesday discs with software and data in 1986; it was a commercial failure.

In 1983, Compact Disc-Audio (CD-A) was developed by Phillips, with the Red Book standard being agreed with Sony. It was much smaller than the previous LaserVision disc, measuring 12cm, and being digital, its pits produced binary signals - pit/no pit = on/off. It was a soaraway success and resulted in the death of vinyl.

The arrival of CD-ROM

The first Compact Disc Read-Only Memory (CD-ROM) appeared in 1985, again a joint venture between Philips and Sony. It was seen as a text-only ‘big-disc’ medium with its 650Mb capacity with a limited data transfer rate of 150,000 bytes per second. The technology was adopted by library and reference publishers, because of the promise of searchable bibliographic databases being easier and cheaper than online services (Schwein, 1996).The ISO 9660 standard which defines the format for storing data and files on CD was agreed in the late 1980s. It is also called the Yellow Book standard. The High Sierra standard was later developed to address the confusing logical formats which software houses used for CD-ROM development which were incompatible with each other.

Subsequent developments

Sony, Microsoft and Philips developed the Compact Disc Extended Architecture (CD-ROM XA) in 1988. This is a bridging disc between CD-ROM and CD-I (Compact Disc Interactive), another later development from Philips, and described by Hoffos (1992) as ‘a true multimedia platform’. CD-ROM XA increased multimedia flexibility by allowing sound, text and data to be interleaved and encoding data so that audio-visual information can bypass the central processing unit (CPU) and access the relevant processor, thus allowing for a constant flow of information, one of the requirements of interactive multimedia.

In the late 1980s, Digital Video Interactive (DVI) technology was introduced, a process comprising a set of compression algorithms in a chipset. The compression ratio of 160:1 allows for 72 minutes of full-motion video, and although it had video quality, there is less resolution.

Multimedia hardware developments

Running almost parallel with the development of optical storage technologies, the first home microcomputers appeared during the late 1970s with 8” floppy discs being standard. These micros were usually incompatible but they provided an opportunity for a whole generation to familiarise itself with the principles of micro computing and programming. The ZX81, developed by Clive Sinclair in the UK was highly instrumental in this respect. Later, in 1981, IBM launched its PC with a 64k capacity, 160k hard drive and 5.25” floppy drive. The following year, Apple launched the Macintosh with a 256k RAM and a single non-standard 3.5” floppy disc drive. The Mac is quite unique in that its entire interface is ‘point-and-click’.

The first computer to be described as truly interactive (Burger, 1993) was the Amiga, which was released at the end of 1985. Its minimum configuration is 512k RAM, a 68000 processor, and no monitor or hard drive. This PC is very popular in Europe, having never really cracked the US market, despite its landmark multimedia architecture.

With the growth of multimedia that CD-ROM brought for both hardware and software, the Multimedia Personal Computer (MPC) Marketing Council - comprising Microsoft and Tandy established a minimum standard for developing and running software on PCs in 1991. The standard then consisted of 4 Mb RAM, a CD-ROM drive. The standard was upgraded in 1993 and 1995. It is now standard for PCs to have the following specifications (as in 1998):

· quad- to six-speed CD-ROM drives

· a minimum of 1.6Gb RAM

· 16Gb hard disc space and a

· 133 Mhz processor.

Current technological advances indicate that even this specification may become obsolete. For example, Moore’s Law states that the power of processors usually doubles (and can be expected to double) every 18 to 24 months (Moore, 1997). The rapid technological advances suggest that this ‘law’ may no longer be applicable.

Development of ICT in schools

ICT was first developed in schools in the UK in the 1960s. The National Council for Educational Technology (NCET) was formed in 1967 to explore the application of IT in schools. The organisation produced a working paper two years later entitled Computers for Education, in which they distinguished between ‘computers for education’ and ‘education about computing’.

The first microcomputers were introduced into schools in 1977. The then Department of Education and Science had sponsored a five year National Development Programme in Computer Assisted Learning (NDPCAL) from which resulted significant development of software for micros in schools.

The first forays into putting multimedia into schools were instigated by the Department for Trade and Industry in the late 1980s who funded an educational project called Interactive Video in Schools to assist schools exploit the benefits of the technology. It had announced in the early 80s its intention to put a computer into every school. A computer literacy project was set up by the BBC who gave its name to the BBC Micro and screening programmes twice per week, showing people how to use computers. The rate of adoption of computers in the UK in the 1980s was a lot faster than average. However, this adoption resulted in a high penetration in both the home and schools of computers that are now obsolete: the BBC Micro, Amiga, Atari and Acorn Archimedes.

In 1992, the former UK government set out to finance the installation of a computer and a CD-ROM drive in 4,000 secondary schools, thus offering potential access to an enormous quantity of the world's knowledge. But there was been a failure to insist on standardisation. Staff and children faced serious problems in mastering technical incompatibilities and differing varieties of software. Thirteen software developers were commissioned to produce CD-ROMs for the National Curriculum on a variety of subjects, and each developer was said at the time to be caught up in a process akin to reinventing the wheel. None of the CD-ROMs recommended for an initial trial was available for the Acorn Archimedes, a computer already widely installed in schools and which is still a favourite with teachers for its capacities with graphics and on-screen video.

The law has helped, as schools in England and Wales are now required to teach information technology as a subject and to apply it across the curriculum. Since the National Curriculum was introduced in 1988, the government has spent nearly £400m on Information Technology (IT, now referred to as ICT [Information and Communications Technology]) for schools between 1988 and 1996. In 1995, extra grants were made to companies that developed new educational applications for the 'information superhighway', and the government devoted £3m to equipping primary schools with CD-ROM equipment. In 1998, another £200m was secured for investment in the information and communication technologies, with particular attention to be paid to teacher training in ICT.

Apart from the inclusion of ICT in the National Curriculum, the Private Finance Initiative was established to encourage public institutions to find commercial partners. Examples include Tesco's Computers for Schools programme, Nike's school sports hall, and the first ICI science lab. The City Technology Colleges programme, designed in 1986 to incorporate 20 new colleges, had difficulty in attracting sponsors and stopped at 15. To date, there are

There are now at least 13 computers in the average primary school, compared with 10 in 1994, and an average of 96 in every secondary compared to 85 in 1994. Multimedia PCs averaged 2.7m in each of the 3,847 secondary schools in England, in addition to 2,300 primary schools. The Multimedia Portables for Teachers project, conducted by NCET (now BECTa - British Educational Communications Technology Agency) received £5m in 1995 to develop teachers’ ‘competence and confidence’ in the use of ICT. Despite huge spending, and the positive results from the Multimedia Portables project, the general view is that ICT is not making speedy progress as can be seen from the above figures. A number of factors have been cited: patchy guidance, lack of direction from senior management, lack of opportunity to use ICT, reluctance by many teachers to use computers (which may also be linked to their poor ICT skills), and, possibly, gender bias.

There is, however, an attraction to disc publishers in that the education market is quite ideal to CD-ROM publishing: it was one of the first outside the games market to develop and there is crossover potential into the consumer market. However, the educational multimedia market is still immature at best and large publishers in general are now reluctant to invest in something so slow and highly speculative. It would also appear that, as a whole, educational publishers are not involved in influencing direction in education, and teachers, in particular, have a distaste for what they see as 'commercial aggression'.

The most recent and visible political development has to do with the National Grid for Learning which was launched in the spring of 1998. The theory behind this development is that all 32,000 schools in the UK should be connected to the Internet. The initiative is backed by a £700m investment and includes a major teacher training programme. This has serious implications for publishers seeking to target and maintain the schools market.

The Learning Software Taskforce identified several government initiatives to address software development for education that are presently underway. These include the Software Business Network, European technology/content delivery programmes, the University for Industry, the Virtual Teacher Centre (for teacher-training in ICT), and IT for All.

The Electronic Publishing Industry and its Market

Industry analysis

Competitive strategy is an enterprise’s plan for achieving sustainable competitive advantage over, or reducing the edge of, its adversaries. In Porter’s view, the performance of individual companies is determined by the extent to which they cope with, and manipulate the five key forces which determine supply and demand in particular commercial and industrial sectors, namely threat of new entrants, threat of substitutes, bargaining power of suppliers, bargaining power of buyers and the rivalry of competitors:

‘The goal of competitive strategy...is to find a position in an industry where a company can best defend itself against these competitive forces, or can influence them in its favour’. (Porter, 1980)

Porter’s Five Forces Model is the most appropriate for analysis of the educational multimedia industry. However, there are some who argue that, while his approach has been influential, there are several weaknesses along with the strengths of this rationalistic approach to strategy (Tidd, et al: 1998, for example). To summarise these arguments: Porter’s framework underestimates the power of technological change to change the structure of an industry; the fact that individual firms are often constrained in their choice of innovation strategies is also underestimated; and finally, strategy implementation problems have no place in Porter’s Five Forces Model. Nevertheless, it is a useful analytical tool and, once strategic analysis has been undertaken, firms can choose from four generic market strategies:

1. overall cost leadership

2. product differentiation

3. cost focus and

4. differentiation focus.

Industry rivalry in the learning software market

The intensity of rivalry in an industry is determined by the following interacting structural factors: the number of competitors, slow industry growth, high fixed or storage costs, lack of differentiation or switching costs, large incrementalisation of augmented capacity, diversity of competitors, high strategic stakes and high exit barriers.

The following are the main players in the learning software market: Europress, Dorling Kindersley, Letts, Longman, Aircom, GSP, Focus Multimedia, Mathsoft (US), The Learning Company (US), BBC Multimedia, Tivola (Europe) and Havas Interactive (formerly Cendant Software, US) and Anglia. The remainder is shared by about 190 other publisher-producers, many of them small ‘cottage industries’.

The learning software market share of the top six companies by value is as follows:

Table 1: Total PC-CD-ROM by Company (Value)

Company	Value (%)
The Learning Company	31.8
Europress Software	12.8
Dorling Kindersley	12.2
Havas Interactive	9.0
GSP	3.3
Focus Multimedia	2.5
Total market share of top six	71.6

Source: Chart Track Monthly Report, July 1999

Competition is fierce and there is a lack of differentiation between brands. Companies seeking to use branding (such as the BBC) to build business face a challenge in that the curriculum-based software market is not global.

In terms of hardware, two platforms dominate the schools market: Acorn and Research Machines (RM), which provides IBM-compatible PCs. Both platforms are incompatible, however, and as the Survey of ICT in Schools’ statistics indicate, more schools are adopting the PC platform.

Overview of the UK market

The most recent figures from the 19^th edition of The Multimedia and CD-ROM Directory, indicate that that there has been an increase in the number of commercially available CD-ROM titles, from 19,000 in 1997 to 28,000 in 1998 (a 68% increase). On the other hand, the number of companies has increased by only 15% to approximately 15,000, from 13,000 in 1997.

Of these companies, over 200 (1.3%) are in educational multimedia publishing and distribution (that is, for schools) with about 20% of titles referred to as 'educational'. Since 1989 the overall number of multimedia titles has grown by over 130%. Around 98% of all multimedia titles are written for the consumer market.

In 1994, the UK installed base of PCs with CD-ROM drives was estimated to be around 320,000 with predicted growth to 850,000 by the end of 1995. Around 20% of all PCs sold into homes were fitted with a CD-ROM drive and during 1995 the indications were that this would increase to around 30%. According to research consultancy Inteco, there were 1.5 million CD-ROM drives installed in home computers in 1995. In 1996 the figure was 2.8 million, and there were forecasts of 4.5 million by the end of 1997. This forecast was exceeded and the installed base for PCs with CD-ROM drives now in 1998 stood at 6.3 million.

The multimedia software market is still in its infancy and offers many opportunities for publishers (Lloyd, 1997; Consulting Trust, 1993; Jeffcoate, 1996). While it accounts for only 1 to 3% of revenue compared to traditional publishing (European Information Trends, 1996), publishers are warned that late entry could be disastrous. Encyclopaedia Britannica did not enter into multimedia publishing until quite late and could not compete with the other already established CD-ROM reference publishers: Grolier, Compton’s and Microsoft. It was sold off to the Swiss in the mid 1990s.

Trends over the past few years in terms of CD-ROM sales can be summarised as follows:

· Strong sales of reference and language titles, ‘reflecting the interests of a predominantly middle-class audience’

· Hindered growth due to lack of product in particular areas and Internet access (Wait, 1996; McRedmond, 1996).

The base of installed CD-ROM drives is still nowhere near big enough to satisfy the growing number of titles now flooding the market. There is also a lack of understanding of the barriers to product use and marketing opportunities have not been clearly identified. Despite the gloom, the business and professional information sector, children's products, education and research and training sectors have continued to expand.

Market Projections

CD-ROM is continually perceived as a temporary technology that will soon be taken over by the World Wide Web. The point is that the great bulk of electronic media is now CD-ROM based. Other predictions indicate that the technology will last for quite a while yet.

Various agencies have differing predictions based on estimates and any study of statistics provided must, therefore, be approached with caution. By 1996, it was predicted that four out of five personal computers sold for home use would have CD-ROM drives and growth would be fuelled by demand for home education products. By 1995, the home multimedia education market in Europe would be worth $125m (£78m) and would rise to $2bn (£1.25bn) by 2000 and to $5.9bn (£3.69bn) by 2005. Other projections from Ovum Ltd suggest that

by the year 2005, publishing which includes images, audio and video will be worth $31.2bn (£19.5bn) in the US and Europe. European growth will outstrip American growth during the period, to end with 31% of the combined market, compared with 11% in 1994. In Europe, revenues for multimedia publications for business in the year 2000 will be $184m (£115m) on-line and $269m (£168m) on disc.

Datamonitor estimates that the European market for PCs with CD-ROM drives will reach as many as 17m by the end of the decade.

These projections, though widely diverse (and quite conservative, given the slow growth and immaturity of the market), are quite promising. How publishers can enter the multimedia market and thus exploit the information is, however, quite daunting, particularly because of the financial barriers to investing in multimedia which have stubbornly remained since the last decade.

The steadily falling costs of MPCs is seen as a major factor for boosting the market. However, although prices for multimedia hardware are falling, they are still high enough to deter many households, whereas high-income families are beginning to acquire second PCs. In addition, technical incompatibility between the hardware products available on the market means that using multimedia products is still a difficult task for the uninitiated consumer.

Current state of the learning software market

The education market in the UK is worth approximately £600m, of which the learning software industry, at approximately £12m, is worth 2%. If the learning software industry is placed in a purely digital media context, which takes the convergence of the telecommunications, information technology and entertainment and information industries into account, then, perhaps a more realistic estimate of the industry’s worth can be made. The figure provided by the Digital Media Alliance Steering Group of the market’s worth is £925m. Therefore, the learning software market would be worth approximately 1.3%. Either way, the market is extremely limited in terms of being able to supply sufficient products that will ‘meet the vision of policy makers and educators’ (Report of the Learning Software Taskforce, June 1998). Because of the narrow focus of the market, the Taskforce argues that publishers are misled if they attempt to ‘solve’ this problem by selling their products into home and overseas markets which originates in a misunderstanding of the characteristics of both these markets. On the other hand, companies outside the UK can provide localised products that will meet National Curriculum needs.

Kington (1995) contends that the education market needs to integrate with the business and industrial worlds in order to grow and mature.

Until some maturity is brought into the marketplace, that is to say, being able to import products from the business world, further growth will be restricted.

Competitive strategies of multimedia companies

Thompson (1997) describes the strategic decision making process as one where strategy formulation and implementation are iterative. He agrees with Mintzberg (1989) that strategy can be formulated in three different ways:

· rational, systematic planning

· entrepreneurial creation by a visionary leader

· incrementally emerging as managers adapt to environmental changes.

His discussion of growth strategies in Strategic Management: Awareness and Change identifies diversification, mergers, acquisitions and joint ventures as the most popular growth strategies of UK companies, and argues that these need to be carefully planned, analysed and implemented in order to succeed. The model he uses is based on the Ansoff product-market matrix, which was designed in 1965 to address the growth strategies of companies seeking to expand into new or existing markets with new or existing products.

Competitive strategy is taking offensive or defensive actions to create a defendable position in an industry, to cope successfully with the five competitive forces and thereby yield a superior return on investment for the firm. The best strategy for a given firm is ultimately a unique construction reflecting its particular circumstances. However, at the broadest level there are three potentially successful generic strategic approaches to outperforming other firms in an industry, as identified by Porter (1980) identifies three ‘generic competition strategies’ which are cost leadership, product differentiation and focus (cost and differentiation).

Cost leadership

Cost leadership requires aggressive construction of efficient-scale facilities, vigorous pursuit of cost reductions from experience, tight cost and overhead control, avoidance of marginal customer accounts, and cost minimisation in areas like R&D, service, sales force, advertising, etc., within the firm’s value chain.

A low-cost position protects the firm against all five competitive forces because bargaining can only continue to erode profits until those of the next most efficient competitor are eliminated, and because the less efficient competitors will suffer first in the face of competitive pressures.

Achieving a low overall cost position often requires a high relative market share or other advantages, such as favourable access to raw materials.

Once achieved, the low-cost position provides high margins which can be reinvested in new equipment and modern facilities in order to maintain cost leadership.

Differentiation

The second generic strategy is one of differentiating the product or service offering of the firm, creating something that is perceived industry-wide as being unique.

Achieving differentiation may sometimes preclude gaining a high market share. It often requires a perception of exclusivity which is incompatible with high market share. More commonly, however, achieving differentiation will imply a trade-off with cost position if the activities required in creating it are inherently costly.

Focus

The final generic strategy is focusing on a particular buyer group, segment of the product line, or geographic market. The firm achieves either differentiation from better meeting the needs of the particular target, or lower costs in serving this target, or both. Focus may also be used to select targets least vulnerable to substitutes or where competitors are the weakest. The focus strategy always implies some limitations on the overall market share achievable. Focus necessarily involves a trade-off between profitability and sales volume. Like the differentiate strategy, it may or may not involve a trade-off with overall cost position.

Strategic Planning in the Electronic Publishing Industry

The story of the earliest attempts of publishers entering the electronic publishing industry can be summed up as follows, using Mintzberg’s approach on intended and realised strategies: The industry set out to exploit intellectual property by reproducing them on CD-ROM (intended strategy). The big profits which were predicted failed to materialise (unrealised strategy) and many companies withdrew from the market (deliberate strategy). However, some of these companies have turned their attention elsewhere (deliberate strategy) due to the recent rise of the Internet and the World Wide Web and are providing value-added services online, or else seeking to exploit the new DVD technology (emergent strategy).

Intended strategies of multimedia companies

Dixon (1996), formerly the electronic publishing manager for Penguin, contends that content in the early days of multimedia publishing was the industry’s biggest myth. Publishers were very keen to exploit intellectual property rights (IPRs) ‘in anticipation of a mass market’. The thinking of that time was ‘good book equals good CD-ROM’. The strategy was to cater for a mass market. Snyman (1996) concurs with Dixon:

The saying content is king, which was heard in the early days, was indicative of the fact that many people did not understand the confused and immature nature of the various channels.

Publishers also had to contend with the difficulties in publishing in a format that was virtually unknown to them. Jeffcoate (1996) has identified several differences between book and multimedia publishing in terms of the global nature, skills required, production processes, costs, marketing and distribution, and competition.

Other issues facing the publisher are

· copyright and potential software piracy

· increased use of network technologies for desktop video conferencing, electronic commerce, computer-supported co-operative work and computer-mediated communication

· the technological push towards convergence of the telephone, television and the PC.

Unrealised strategies of multimedia companies

Several large companies have pulled out of investing in CD-ROM based multimedia. These include Reed, Penguin and HarperCollins. They have argued that the market for consumer titles is too small and they expect CD-ROM technology to be replaced by on-line. Derek Meakin, chairman of Europress, argued at a New Media seminar held at Manchester University that these companies went into the field expecting to make quick profits without doing adequate research. Indeed, Andrew Welham, group sales director at Penguin confirmed that 'too many assumptions were made'. Meakin summarised the mistakes that the companies made as follows:

· bad management

· overdependence on branding

· high prices

· taking too long to bring a product to market, in a market that is constantly and rapidly changing.

Deliberate and emergent strategies of multimedia companies

In October 1995, Reed International Books stopped operating Reed Interactive (their general market electronic label) but simultaneously launched Reed Education Electronic Publishing. In 1997, the company closed this division, although they were quick to explain that the closure did not reflect Reed's commitment to electronic publishing. It was, however, a shift in the company's strategy. Electronic publishing continues under the Reed Educational and Professional Division.

Penguin shut down its multimedia operations in both the US and the UK after two years. Andrew Welham identified three reasons for this decision: (1) incorrect market research resulting in too many wrong assumptions (2) people weren’t buying products as anticipated and (3) the market was seen as non-existent. It now concentrates on on-line and Web site development.

HarperCollins closed its adult CD-ROM operation in May 1996. The CD-ROM operations had been overseen by Rupert Murdoch himself, a sign of the importance he attached to the electronic delivery of his intellectual properties. The company's schools CD-ROM of Romeo And Juliet, produced with the BBC, was hampered by the technological limitations of the medium, another reason cited by others for the failure of CD-ROM (Shipside, 1996). One sister CD-ROM company, HarperKids Interactive, was closed down later in the year and a deal signed with another sister company, Fox Interactive, to produce CD-ROMs based on the HarperCollins Children’s Books titles.

According to a survey by Book Marketing Ltd, multimedia publishing has now polarised into two camps - committed companies and uninterested companies. While fewer publishers are producing CD-ROMs, more booksellers are selling them, particularly the independents.

Moreover, a new breed of new technology firms have arisen to address the need for high quality learning software.

Current growth strategies

There has been a spate of acquisitions in the past two years...Dorling Kindersley company acquired Acacia Interactive, publisher of curriculum-based CD-ROMs. A new range of software was published under the brand name 'DK Acacia'. The company also changed the name of DK Multimedia to DK Learning to align itself with the government’s strategy for the National Grid for Learning. Mattell acquired The Learning Company in 1999 (?). The TLC had acquired Broderbund Software in June 1998, then cut 500 jobs in September of the same year.

Barriers to entry

Porter (1980) explores six major barriers to entry: economies of scale, product differentiation, capital requirements, switching costs, access to distribution channels, cost disadvantages independent of scale and government policy. An attempt is made to link these barriers to a discussion of Lloyd (1997):

The UK personal computer market is growing faster than any other country in the world. 30% of homes have computers with CD-ROM drives which now come as standard for multimedia PCs (MPCs). 50% of these homes have children. 36.5% of users use the PC for education. Industry estimates suggest that publishers entering the CD-ROM market can expect returns of up to 40%.

However, Lloyd (1997) has identified several issues in the CD-ROM market facing publishers which are:

· consumer confusion and mismatch of mental models (switching costs, product differentiation)

· publisher confusion (product differentiation, access to distribution channels, government policy)

· fragmented retail channels (product differentiation; access to distribution channels)

· the dissolution of a standard hierarchy in terms of sales channels and branding (product differentiation)

· low budgets and high prices (capital requirements; cost disadvantages).

Consumer confusion and mismatched mental models

In addressing this issue, Lloyd (1997) identified several concerns particularly with respect to consumer attitudes to CD-ROM. Multimedia publishing on CD-ROM has become a niche activity, since the consumer base is still not large enough to warrant mass production. The language used to describe the technology and those who use it is rooted in engineering. For example, with reference to design, the term 'user interface' has its origins in the later 1970s and comes from the world of engineering (Grudin, 1993). From engineers and programmers, the term 'user' was applied to people not necessarily in engineering or computing, but who reacted/interacted with the system in order to achieve certain goals. Grudin argues that because of the broadening of the context in which the term is used, it has become 'problematic' and he further argues that the term 'user interface' does not necessarily mean that both user and computer system complement each other. Hence the challenge for electronic publishers/software designers is to design software that will allow users to communicate their desires to the system and result in their current and future needs being satisfied (Bass & Coutaz, 1991; Burger, 1993). Nevertheless, interactive multimedia technology is seen by the public as a technical medium, particularly because of its links with the hardware needed to use it.

Many user interfaces today tend to be driven by technology, whether that technology is currently existing or in development. The end-user is not usually considered. Despite being a multi-billion dollar industry, and despite the increasing trend for products being pitched at the consumer, the design of many user interfaces leaves much to be desired because they are, in a word, not very user-friendly. Michael Kapor (1991), a highly respected figure in the microcomputer industry, said in the Software Design Manifesto:

Despite the outward success of personal computers, the daily experience of using computers is far too often still fraught with difficulty, pain and barriers for most people...The lack of usability and poor design of programs is the secret shame of the industry.

Software is often created with engineers or computer 'nerds' in mind. There are some exceptions (e.g., Dorling Kindersley, a traditional publisher who entered the multimedia market in its infancy).

The challenge, seven years later, is for software designers to adopt the marketing philosophy of the business world that places the customer/end-user at the very heart of the operation/design process. This may involve a change in the use of familiar terminology such as 'user' as it reinforces an engineering perspective (Grudin, 1993) rather than treating the customer as paramount and central to software design. Gaines and Shaw (1986) also identified other examples of problematic terminology and noted that this perspective on the part of designers could

create an unfortunate, condescending attitude toward users, exemplified by a paper describing 'idiot-proof programs'.

Luskin (1997) asserts that suppliers in the educational software industry have been failing because they have not understood ‘media psychology’. While he did not exactly define what was meant by this statement, it would appear that he does confirm what other researchers in the science of Human Computer Interaction (HCI) are saying: that the consumer needs to be involved in software development from the very beginning and that this is central to the development process. The importance of the consumer in the process of designing interfaces and the importance of user interface design in electronic publishing product development is explored further in this thesis.

An additional source of confusion is the use of the terms ‘educational’ and, particularly, ‘National Curriculum’ when marketing products to schools and homes. Publishers use these adjectives to gain credibility with both teachers and parents who will, somehow, equate them with certain breakfast cereals which are purported by advertisers to be healthy and good for children. With particular reference to education, this health has to do with children’s scholastic performance. An informal survey conducted of the educational software companies at the BETT ’98 show revealed that the common practice for developers was to design some material which would meet the requirements of the National Curriculum and then add irrelevant and, often, useless material to fill up the CD-ROM. This was (previously) confirmed by a Which? survey in 1997 and also by more formal research with schools and companies.

The marketing of CD-ROMs also alienates the customer (who is already generally suspicious of new technology, although this is slowly changing), in that it does not really explain what the technology is capable of and what the benefits are to consumers. The computer industry (which includes the electronics industry) sees CD-ROM as a ‘big disc’ and hence approach marketing the technology from a engineering/technological point of view. The customer’s unfamiliarity and discomfort with the technology is not being addressed by advertising. Some bookshops and publishers – Waterstones and Dorling Kindersley, respectively – are, however, taking the initiative with ‘try-before-you-buy’ and ‘Tupperware party’ strategies.

The current hyperbole surrounding the Internet does not appear to be doing CD-ROM any favours in the sense that the former has been given more television exposure. Despite the issue of quality of material on the Internet, Metcalfe's Law of Connectivity states that the cost of connection increases linearly with the number of connections. The value of the connection increases exponentially. When the value overtakes the cost, facilities such as the Internet take off. Once a critical mass of connected users is reached, practices begin to change. The increasing use of e-mail is a case in point.

Pricing of CD-ROMs

One problem that publishers faced when producing CD-ROMs, was that despite their reputation, the public would not pay out large sums of money for products they did not understand or were suspicious of. Furthermore, whereas one can go into a bookshop and purchase a book for £4.99, the equipment required to play a CD-ROM costs in the range of £250 at entry level to in excess of £800 at the high end. The price of a PC thus makes it a ‘luxury’ item.

One business model adopted by original equipment manufacturers (OEMs) of PCs in the US is the so-called ‘free PC’ where OEMs collaborate with Internet Service Providers to bundle online services with ‘free PCs’. Another model includes trading-in old PCs for newer models at a lower price which is available in the UK.

Dorling Kindersley initially charged £80 for one of their titles. As the market became more uncertain, the price was dropped to £50, with their latest titles falling to £29.99. An audio-CD costs £14.99 in comparison. Compared to other products such as books, videos and audio-CDs, purchasing involvement is very different in that purchase of CD-ROMs is premeditated. This has consequences for publishers who need to place emphasis on the role of advertising, marketing, branding, and word-of-mouth (MAGPIE, 1997).

Another company that adopted a pricing strategy was Macmillan Interactive. The company released four titles in July 1997 at £9.99. Most of their titles now cost below £20.

The Internet exacerbates the problem of pricing by offering subscription-free access (as with Dixon’s Freeserve - only phone charges are paid for) and content, which is often of very mediocre quality and does not contribute to the learning process.

The problem of market demand has been alleviated by the continually falling prices in hardware and CD-ROM titles themselves. There has also been a dramatic improvement in software quality. In 1996, Europress released a series of eight educational CD-ROMs, called Your Child Can be a Genius, which took three months to produce and was priced at £9.99. Other companies such as ZigZag Multimedia, Focus Multimedia and VCI Software are producing educational CD-ROMs at this price.

Because of falling prices, publishers are not in a position to charge prices which would reflect the high investments in product development. Snyman (1997), formerly of Random House and now managing director for education at CUC Software International, estimates that

only the top 100 educational titles can expect to sell more than 2,500 copies a year, with only the top five or six in excess of 15,000.

Software bundling

This strategy is one which was borrowed from the computer industry by several publishers. Originally, 3.5” floppy discs were bundled with technical books. While this practice is still common, CD-ROMs are increasingly being included. Sager and McDonough (1995) assert that ‘one of the best things about buying a multimedia system is all the pre-installed software and CDs you get’. In order to increase market share, Random House Electronic Publishing, along with other publishers, bundled their CD-ROMs with books. Lloyd (1997), however, presents several questions on the feasibility of bundling CD-ROMs and contends that while this strategy may be beneficial in some respects, such as providing a chance to build familiarity with the technology, it may also a contributing factor in the slowing down of the market.

With particular regard for scale economies, another point to consider about the practice of bundling is that CD-ROMs are usually shipped free with a multimedia PC (as a result of the publishers making distribution deals with hardware manufacturers), and while it certainly boosts the unit sales figures, the profit margin per unit is usually very low. This also distorts the figures in terms of determining actual sales, and, perhaps, cheapens the product in the eyes of the consumer who then expects CD-ROMs to be merely give-away products.

The technology-led market

It would appear that in the year 1994/95, the major sales period for multimedia hardware, sales were driven by (1) customers upgrading to 486 machines, (2) falling prices for 486s and the advent of multimedia (Lloyd, 1997). In more recent months, however, sales of upgrades of slowed down, according to a report from the Multimedia Action Group, a part of the European Commission.

A major problem identified by several writers, including Lloyd (1997), is that the technology is progressing so rapidly as to render systems purchased obsolete. Hence, customers may hesitate before buying an MPC if they think it is going to be obsolete too quickly. Moore’s Law states that every eighteen months the power of the processor increases. With this increase in processor power, and the resultant fall in price, a problem is created not only for consumers, but also for publishers who wish to take advantage of the installed base.

Another issue relates to the ‘lock-in’ to so-called de facto technological standards. The School Managers’ Report on IT in the Curriculum identifies Windows 3.1 as the probable dominant industry standard, since it was on most PCs bought between 1994 and 1996. PCs bought for the home from 1997 onwards have Windows 95, but are used for edutainment rather than education.

‘...schools are led to believe that they are safe if they adopt an industry standard such as a PC with Windows...but which of these operating systems is the industry standard?’

Each industry specifies its own standards: Windows is used in service-based, productivity/industrial-age industries such as banking, travel and hospitality. Apple, however, is the world leader for the creative, information-age industries, such as publishing, design and music, with its System 7.x, and Mac Operating System(s).

Publisher confusion

Available market research

Multimedia is a global industry. However, it is very difficult to obtain statistics for the home market. Available research is either US- or European-based with some mention of the national market. Actual sales figures are out-of-date by at least three years or else over-inflated by computer companies with vested interests in high growth rates (Lloyd, 1997; Screen Digest, 1997). Besides this, there is very little research on curriculum-based software. Any reports, therefore, need to be read with caution, unless provided by reliable sources.

Limited shelf space

While conventional booksellers and other retailers are increasingly, though slowly, giving shelf space to CD-ROM titles, these titles are usually those produced by the larger companies providing ‘edutainment’ titles, such as Microsoft, Disney Interactive and Dorling Kindersley. Whether or not branding means that products are taken at face value remains to be seen. Shelf space is even more limited due to the size of packaging for many CD-ROM products. Some distributors are offering budget-priced CD-ROMs in jewel cases. While this may be suitable for mass merchants, such as supermarkets, Shepherd (1997) argues that this should become the norm if customers are going to make purchases without building extensions to their homes (assuming that they want to keep the boxes)!

Fragmented retail channel

The educational software market’s supply chain is fragmented and inconsistent, in terms of information as well as supply. As is evident further in the thesis (see.....) buyers are ignorant as to where to go to acquire products (apart from national exhibitions such as BETT) and suppliers of multimedia products have no clear strategies for addressing the market (Report of the Learning Software Taskforce, June, 1998). On the other hand, the more established channels for book publishers who are already involved in multimedia publishing, or are venturing into the field, provide an opportunity to add electronic value to print-based products, or use the existing channels to provide new software products. For example, Dorling Kindersley provides terminals in the larger Dillons stores for consumers to try out the products before they buy.

The Multimedia Action Group has identified mail-order as the primary source of the majority of available CD-ROM titles, due to the fact that there are very few specialist retailers. There is also a lack of differentiation in retail outlets such as computer shops and music stores, where emphasis is placed on the top 10 (or 20) best-sellers.

The specialist retailer concept was introduced by Alan Taylor, former managing director of THE in June 1996, with the launch of Software City. It was intended to be a multimedia software superstore chain with four stores opening in the months following, as well as a further ten being planned. It was an excellent concept based on the premise that due to the huge number of titles being published as opposed to the number of space allotted to them in shops, a superstore was needed to deal with the bottleneck effect in CD-ROM distribution. Sadly, it went into receivership shortly afterwards.

Government policy

Kington (1995) argues that ‘there tends to be an unrealistic expectation in the political mind as to the target and level of success in reaching it in a five year period’. Publishers (including multimedia publishers) need to cultivate an ability to second-guess changes in government policy, particularly if they are keen to be first to bring products to market. Part of the present problem of non-standardisation, for example, can be put down to political decisions made to install one platform across a local authority. Such shifts (or inflexibility) in government thinking (particularly for ideological reasons can be costly to publishers in terms of developing software for the schools market.

Dissolution of a standard hierarchy

Brand breakdown

The dissolution of the hierarchy is the result of a lack of a clear sales channel (Lloyd, 1997) and there is the threat that the publisher’s brand will break down, unless actively cultivated.

Multimedia development budgets

The Financial Times report on the CD-ROM market in 1996 demonstrated that for CD-ROM publishers to improve their chances, they have had to adopt a ‘Hollywood-style’ business model, and reversing the publishing strategy, that is, fewer titles are very heavily invested in, compared to books, where many titles are invested in with very little risk. In order to recoup the costs of a £500,000 title, for example, a publisher needs to sell in excess of 20,000. In 1996, Routledge quoted a figure of £485,000 for production costs. In 1997, Marshall Editions spent £400,000 on CD-ROM development. On average, in the UK sales do not exceed 2,000 per title (Meakin, 1996). There have been exceptions, for example Europress’ Your Child Can be a Genius sold 1,600 copies in its first week of release, and exceeded 3,600 within three weeks.

The UK financial sector is reluctant to invest in multimedia CD-ROM development, having received very little reward from earlier investment. This makes it difficult for companies – particularly start-ups - to raise finance, and they are placed in a ‘Catch-22’ situation where success has to be visible before finance can be obtained.

There are some incentives available, such as the Media Investment Club and the EC’s ESPRIT programme with which the UK’s Department of Trade and Industry is involved.

With regard to the threat of new entrants themselves, the issues are content and skills for multimedia, as well as development costs. Publishers are at an advantage because they have a wealth of images and content to which they own the rights. To address the issue of skills in multimedia development, several multimedia software companies have arisen in recent years. Some of these have worked alongside traditional publishers, or, as with Acacia Interactive, been acquired.

Low switching costs can be incurred due to the nature of digital information. An advantage of digitising data is that the information carrier can change with low switching costs from CD-ROM to either hybrid and/or online format, thereby keeping the company’s options open with the ability to respond to market changes and fluctuations.

Threat of substitute products

The CD-ROM is being seen as a transient technology because of the rise and rise of the Internet. Online publishing is nearly 30 years old, at least eight years older than CD-ROM technology. It took off when the World Wide Web was created as a means of accessing it about five years ago. To date, an estimated 122m people worldwide use the Internet. In the UK, there are at least 7,000,000 full access users. These figures are set to double by the year 2000, even without access to digital television (Digital Media Alliance Report, 1998). The Survey of Information and Communications Technology in Schools 1998 identified 17% of primary, 83% of secondary, and 31% of special schools as having Internet access; a total of 6,446 schools.

With regard to technological advances and the race between the Internet and CD-ROMs to deliver multimedia information, manufacturers and Internet Service Providers (ISPs) have developed and begun marketing 56kbps modems. Some cable companies such as TeleWest have completed testing of 10 Mbps Ethernet links in homes that are connected to cable networks. CD-ROM technology in terms of speed is also developing with two Japanese consumer electronics manufacturers, Panasonic and Pioneer New Media, releasing 24-speed drives which can access data at 3,600kbps. At the time of writing this thesis 32-spped drives are also available, with 52-speed drives already available in the US. These developments may keep CD-ROM in contention with online. However, the Internet has several advantages over CD-ROM in terms of its immediacy and, consequently, rapid updateability, its vast storage capabilities and the developments in agent technology for search and retrieval. In addition, there is an ongoing trend to provide free Internet access which companies such as Dixon have done quite successfully and, to date, has over 650,000 members.

The valuing of Internet companies is also another issue. While there are some pundits who are warning that the Internet bubble will burst quite soon, Internet companies are being valued in the millions. CD-ROM has never enjoyed this exalted position.

The most recent development in CD technology has been the Digital Versatile Disc (DVD) which is capable of holding about 13 times more information (on both sides) than a CD-ROM. Increasingly, the new MPCs are being sold with DVD drives as the new standard. However, companies still need to take the already established installed base of MPCs with CD-ROM drives in schools. Apart from DVD, there are other developments in CD technology which include CD-Recordable (CD-R) and CD-Rewritable (CD-RW). Tosihiba has recently launched a new product which combines the DVD-ROM and CD-RW in one drive. In the meantime, manufacturers are predicting shipments of up to 15m CD-RW drives in 1999. There is no evidence, however, of a significant take-up in UK schools of DVD and CD-R technologies.

Bargaining power of suppliers

The electronic publishing industry relies on a wide variety of sources/staffing - whether internal or external to the firm - to supply content and input in various forms: text, video, audio, programming, still images, animation, multimedia authoring. This brings up the question of intellectual property rights (IPRs) and of copyright on content. The very nature of digital information in terms of its manipulability, compressibility, density, networkability and impartiality (Feldman, 1997) is cause for concern to traditional print publishers considering entry into electronic publishing. Copyright issues are ever at the forefront of new media technologies. Print publishers see copyright as the very foundation for their existence. If this is eroded then potential revenue is lost. However, multimedia publishing does not have to be based on potential exploitation of backlists. The technology allows for far more creativity, due to the nature of hypertext which assists the user in navigating through the software.

Baverstock (or is it Owen?) ( ) has identified a few models that have emerged as a result of constant discussions of the issue. The first is that publishing companies have established separate multimedia divisions which would negotiate new contracts with authors (Oxford University Press and Dorling Kindersley, for example). The second model is to simply have an exploitation of electronic publishing rights clause included in the contract. Another model involves protecting the author’s moral rights and providing access rights for users. One more model has to do with the shift towards the ‘value chain’ with multiple copyrights.

The power of author-suppliers is, therefore, small. Neither is there any likelihood of there being any threat of forward integration by such suppliers along the supply chain (Cardoso, 1996).

The power of retailers to dictate prices is significant. They are much closer to the market than publishers and will usually advise publishers to drop prices to maximise sales.

Another source of supply is an outside firm which may collaborate with a publisher through one of several forms of collaboration: subcontracting, cross-licensing, consortia, strategic alliance, joint-venture or networking. Examples are Oxford University Press and AND Publishing (formerly AND Technology [subcontracting], the company is now part of OUP), Dorling Kindersley and Microsoft (a combination of a strategic alliance and a joint venture: DK and Microsoft terminated their alliance in 1995).

Bargaining power of buyers

There are two broad categories of buyers in the learning software market: home and school. The number of potential buyers is proportionate to the number of platforms and/or the installed base of the target market(s).

The home market

In the 1980s, the PC was mainly a machine for playing games and learning to program, used mainly by boys. Today, in the 1990s, it has become the machine for all the family, used as much for professional and school work as for cultural enrichment and gaming. The interest shown by families in educational and cultural multimedia reflects the new concerns of parents. On the one hand, parents are conscious that these products offer an alternative to the passive consumption of television programmes. On the other hand, many of them are anxious about their children's futures, and invest in educational products and services in the hope of providing their children with optimum opportunities for professional and social integration (European Information Trends, 1996).

In terms of consumer characteristics Lloyd (1997) has summarised that surveys of multimedia PC owners show them to be

· ABC1 buyers

· with children

· probably using the PC for work, such as word-processing or accounts, or some teleworking

· and have probably owned a computer before.

She emphasises the importance of the last point in terms of the buying cycle of such families since the 1980s (the early adopters) when they would have made at least four major purchases from the Sinclair/Atari/Commodore through to the Pentium PC.

The schools market

The European Union’s study into educational software in 1996 concluded that while there was great potential for educational multimedia in schools, there were several obstacles:

· the lack of user-friendly multimedia equipment and software for teachers and pupils

· insufficient quantity of equipment, which is often technically obsolete, sometimes insufficiently used, and rarely connected to telecommunications networks

· insufficient quantity and quality of educational software adapted to the needs of users

· the difficulty of integrating educational multimedia into teachers’ educational practice and

· the lack of teacher training and information.

In terms of actual bargaining power, this is relatively low. Schools have very limited budgets (and thus are sensitive to price), teachers have very limited time for evaluating products, many teachers have poor IT skills, and there is a general lack of understanding of the products that are available (due to limited buyer information), as well as the different types of licenses that are available. Many investments in new technology are in hardware and schools are usually ‘locked in’ to de facto standards, although there are indications that switching to more cost effective suppliers of operating systems (for example) would save money, and would enhance buyer power.

Since the European Union’s study, there have been some initiatives which are addressing these issues, though not necessarily as a direct result of the report:

· the aforementioned government’s National Grid for Learning

· at least £700m has been found by the government for investment in ICT and teacher training in IT

· Tesco’s Computers for Schools programme is still continuing

· the launch of the Parents Information Network to advise parents on buying good software

· on-going research undertaken by bodies such as BECTa into the implementation and use of IT and multimedia.

Lloyd’s (1997) discussion of issues facing CD-ROM publishers also apply here, particularly with reference to consumer confusion and mismatched mental models.

Product development in electronic publishing

Product development is a method of increasing sales in present segments by augmenting the present product line. A publisher adding a line of CD-ROMs to increase sales in its present market segments would be involved in product development.

Product development strategies can be brought to fruition by:

1. Developing new features for present products as often seen with various detergents, toothpastes, cereals and cosmetics; and hybrid CD-ROMs with links to the World Wide Web.

2. Designing additional models and sizes of the product as exemplified by the proliferation of different models of 35mm cameras by the same manufacturers; or different formats of the same publication, as in hardback, paperback, and miniatures with sample chapters; or an online service to complement existing services and products, as with International Thomson Business Publishing (for example).

3. Creating improved versions of products as has occurred with some heating systems, window and door installation units for the home, and child-restraint systems for automobiles. With reference to electronic publishing, this would be the improvement of usability and functionality of CD-ROM or online multimedia products; building in networkability and additional features.

Product-market strategies

Ansoff’s Growth Matrix

Ansoff (1965) was the first to describe the product-market matrix in terms of a company’s attempt to elaborate its business (Mintzberg and Quinn, 1996). This matrix was designed to address companies’ growth strategies whereby they can develop their markets by way of new segments, channels or geographical areas, or through seeking to push the same products to the same markets. It is popular with companies seeking to diversify their activities.

The matrix form adopted by Ansoff suggests that there are five main alternative product-market strategies which can be illustrated below in Fig 1, and can be summarised as follows:

Fig. 1 An adaptation of Ansoff’s product-market matrix

Product	Existing Products		New Products
Existing Markets	Consolidation	Market Penetration	Product Development
New Markets	Market Development		Diversification

1. Consolidation: positive and active defence and reinforcement of existing market and segment provision

2. Market penetration: increasing market share within existing markets and segments. Promotional and sales expenditure is usually increased, or competitors and/or divergent companies that are able to provide synergy might be acquired. This is the favoured strategy of some firms in educational multimedia publishing at present. For example, DK with Acacia Interactive and The Learning Company with Broderbund Software.

3. Product development: this is the management and development of existing products and brands, as well as facilitating new product development and the introduction of new brands

4. Market development: new and existing markets can be developed as a result of new market research findings, more detailed market segmentation, customer targeting, or extensive advertising and promotion to stimulate or revive market demand, and as a result of technological change and innovation. Companies can also adopt reactive marketing strategies in such cases where they are approached by customers expressing concerns about product availability, usability or functionality.

5. Diversification: this strategy has four alternatives:

· Horizontal integration: one firm takes over another with a similar strategy

· Concentric diversification: the firm diversifies into related activities. For example, a publisher diversifying into bookselling or multimedia (again DK is a good example; also WH Smiths acquisition of the Internet Bookshop)

· Vertical integration: the firm may diversify backwards or forwards along the supply chain

· Conglomerate diversification: the firm diversifies into unrelated activities to which it can apply particular skills, competencies and resources in order to gain distinctive or competitive advantage.

With respect to high technology industries (of which electronic publishing could be considered to be one) Buskirk and Popper (1998) propose expanding Ansoff's Growth Strategy Matrix to identify six separate market conditions – or cells - which represent increasing risk for marketers. The cells range from the most secure environment in which known products are sold to established markets, to the most challenging environment in which high tech products are offered to markets which have not yet been defined. In their work, they have added a ‘New Technology-New Markets’ cell, and hence the growth matrix appears as follows:

Market

		Existing	New
	Existing	Market penetration	Market development
Product	New	Product development	Diversification
	New Technology	Technological product substitution	High technology

Fig. 2 Extended Growth Matrix

They assert that the significant failure rate among high-tech products results from the failure of firms to realise that they are no longer competing in a high-tech market environment, which tends to be product-oriented, as opposed to consumer-oriented, and have proposed that firms develop specialised marketing competence in each of the six environments. They argue that customers need to be educated about the products they are being sold, even before the benefits are described. This last point is particularly pertinent to products developed for the National Curriculum, where there is very little differentiation and very little recognition of brand names with the exception of companies such as DK, YITM and Anglia. The general practice amongst publishers is to state on the packaging that the product is suitable for the National Curriculum but very little else is done by way of educating the user or user involvement in product development.

Nevertheless, this is slowly changing with recently established organisations such as Teachers Evaluating Educational Multimedia (TEEM) and the longer established BECTa playing an important part in providing teachers with information about available products. BECTa sees itself as a ‘middleman’ between schools and developers, as there is no official forum. To date, at least 1,000 CD-ROM titles have been evaluated by BECTa, compared to 46 in 1991, and the reviews are available on the organisation’s Web site (http://www.becta.org.uk/information/cd-roms).

Research methodology

The aim of this section of the thesis is: to develop an argument for an appropriate methodology, taking into account:

1. The intellectual framework based on existing research and current thinking

2. The range of potential research methods

3. Strengths and weaknesses of potential research methods

Why research educational multimedia?

I chose to research this area of information and communications technology because of my own background in publishing, having studied up to degree level and having been exposed to multimedia concepts and practice as early as 1993 during my sub-degree level studies. I have also completed postgraduate studies in user interface design which studies have emphasised the need for multimedia products to be user-centred and user-friendly. At present, I teach multimedia technology to degree level students and have had some experience in managing multimedia projects, though not for schools (as in developing National Curriculum products). My own motivation for pursuing this study is that it will be one of commercial value to the publishing industry.

This involvement undoubtedly would introduce some bias within my research, supporting the user-centred approach to multimedia design and production. Easterby-Smith, Thorpe and Lowe (1991) discuss the involvement of the researcher in his/her own research and argue that such a decision would stem from the philosophical approach taken. The issues of bias and philosophical approaches are discussed later in this section.

There are two main philosophies to management research which have their roots in the mid-nineteenth century, and which are confirmed by later writers such as Easterby-Smith, et al (1991): the positivist and phenomenological philosophies. The positivist philosophy is similar in nature to the rationalist school of thought in corporate strategy. This philosophy assumes that knowledge is acquired through the observation of external realities, and that such realities are objective, rather than subjective. The central nature of positivism is its deductive approach which, in research, has several implications as listed by Easterby-Smith, et al (1991) below:

1. Independence: the observer is independent of what is being observed.

2. Value-freedom: the choice of what to study, and how to study it can be determined by objective criteria rather than by human beliefs and interests.

3. Causality: the aim of the social sciences should be to identify causal explanations and fundamental laws that explain regularities in human social behaviour

4. Hypothetico-deductive: science proceeds through a process of hypothesising fundamental laws and then deducing what kinds of observations will demonstrate the truth or falsity of these hypotheses.

5. Operationalism: concepts need to be operationalised in a way which enables facts to be measured quantitatively.

6. Reductionism: problems as a whole are better understood if they are reduced to the simplest possible elements.

7. Generalisation: in order to be able to generalise about regularities in human social behaviour, it is necessary to select samples of sufficient size.

8. Cross-sectional analysis: such regularities can most easily be identified by making comparisons of variations across samples.

Advantages and disadvantages of the positivist approach

Key advantages of this approach include:

· economical collection of large amount of data

· clear theoretical focus for the research at the outset

· greater opportunity for researcher to retain control of research process

· easily comparable data.

Key disadvantages are:

· inflexibility - direction cannot be changed once data collection has started

· weakness at understanding social processes

· often doesn’t discover the meanings people attach to social phenomena.

Other features of this philosophy include: seeking to explain causal relationships between variables; using highly structured methodology to facilitate replication (Gill and Johnson, 1991); using quantitative data and employing controls to allow the testing of hypotheses. The philosophy lends itself more to experimental design and statistical analysis and, since it was the strategic use of CD-ROMs in schools that was being investigated (as opposed to actual product testing, for example) along with what is happening in the educational multimedia industry, it was deemed inappropriate to apply such a philosophy which depended heavily on data which would, of necessity, be quantitative in nature.

The phenomenological approach and the nature of qualitative research

This approach is a more recent one which is credited to Husserl (1913) and is dedicated to describing the structures of experience as they present themselves to consciousness, without recourse to theory, deduction, or assumptions from other disciplines such as the natural sciences.

A major difference between this and the positivist approach is that theories and concepts tend to arise from enquiry and come after data collection rather than before it. Any data to be collected would be interpretative and qualitative in nature.

In seeking to defend the relevance of qualitative research Ely et al (1991) and Sherman and Webb (1988) outline six characteristics of qualitative research:

1. Events can be understood adequately only if they are seen in context. Therefore a qualitative researcher immerses him/herself in the setting;

2. The contexts of inquiry are not contrived; they are natural. Nothing is predefined or taken for granted;

3. Qualitative researchers want those who are studied to speak for themselves, to provide their perspectives in words and other actions. Therefore qualitative research is an interactive process in which the persons studied should teach the researcher about their lives;

4. Qualitative researchers attend to the experience as a whole, not as separate variables. The aim of qualitative research is to understand experience as unified;

5. Qualitative methods are appropriate to the above statements. There is no one general method;

6. For many qualitative researchers, the process entails appraisal about what is studied.

Advantages and disadvantages of the phenomenological approach

Key advantages of this approach are:

· it facilitates understanding of how and why

· it enables researcher to be alive to changes which occur during the research process

· it is good at understanding social processes.

Key disadvantages are:

· data collection can be time consuming

· data analysis is difficult

· the researcher has to live with the uncertainty that clear patterns may not emerge

· it is generally seen as less credible by ‘non-researchers’.

The qualitative research method was much more suitable to the needs and resources for small-scale research in that it enabled the research to focus on particular groups, namely, educational multimedia consumers and providers, in an attempt to study the relationships that exist between them.

Because the multimedia is a fragmented industry, some argue that pluralistic models may be most appropriate to information systems (IS) research (Banville and Landry, 1988, for example). The qualitative approach was chosen because, apart from the fact that it provided the mechanism for testing a hypothesis, it also provided the opportunity to combine more than one method. These methods included:

(a) Semi-structured taped interviews (where possible and appropriate), which allowed some freedom to ask questions in whatever order was appropriate, and to disregard questions that were not appropriate. Some informality was necessary to encourage interviewees to speak as freely as they could while disclosing information not considered to be too sensitive;

(b) Personal observation of classes using multimedia (participant observation), and

(c) The study of relevant documents, for example, annual reports and accounts, press cuttings, government reports, pedagogical resources, etc.

Research Focus

The focus of this research seeks to identify how schools go about planning for, implementing, and using CD-ROMs within the context of the National Curriculum and tests the hypothesis that, as a result of intense competition driving the growth of educational multimedia products, a possible mismatch has resulted between producer-suppliers of educational multimedia products and schools. This thesis takes a mainly qualitative approach to educational multimedia publishing in its examination of the tension between technology-led and market led-product development.

Research Methodology

A qualitative analysis of London-based primary and secondary schools' use of interactive learning materials was undertaken in the summer and autumn terms of 1997. The research set out specifically to investigate (i) how schools decide to use multimedia products (ii) the current extent of multimedia product implementation within the curriculum and (iii) teachers' perceptions of the effectiveness of current multimedia products as pedagogical tools. ( ) schools responded out a total of ( ). Staff positions ranged from a librarian to a Director of Studies who also doubled as IT co-ordinator and teacher. Several classes across the different types of schools were observed using software packages such as Encarta, Romeo and Juliet, Hyperstudio and Grandma and Me. Interviews and observations were carried out in schools in the autumn where it was not possible to meet them during the summer term due to factors such as examination preparation/progress, staff changes and early adoption of ICT (including CD-ROMs) in schools. The timing was particularly crucial for secondary schools since pupils were going to be taking their exams and this time of year is usually a very busy one for staff since they are coming to the end of the school year.

The table below provides a breakdown of the types of schools contacted and the response rates (the response rate does not take negative responses into account):

Table 2: Response Rate of London-Based Schools

Type of school/college	Number contacted	Number responded	Response rate %
Day Special	8	0	0
Primary	127	3	2.4
Secondary/High	226	4	1.8
Grant-Maintained	80	2	2.5
Independent	36	1
City Technology (or other Specialist) Colleges	6	2	33.3
Total

It must be noted that due to the timing of the research, it was vital that as many institutions be contacted as was possible for them to respond within the timeframe. The low number of technology/specialist colleges based in London means that the response rate is much higher, thus providing a distorted picture.

Further qualitative research, involving one-to-one interviews with two electronic multimedia publishers and four (to be confirmed) software houses were carried out between 1998 and 1999. Qualitative research was also undertaken in associations that feed into schools, including special needs and trade associations. With respect to companies, the research set out to determine how products are developed, how companies develop and execute marketing and financial strategies for educational multimedia products, what they perceive to be the factors contributing to the success of such strategic plans and how they see government intervention impacting on their organisations. Research in the feeder associations set out to ascertain views of ICT and multimedia in education and its effectiveness (or not) in raising standards, as well as further discussing issues affecting education in the UK.

Making initial contact with companies and associations by fax was highly problematic and partly due to the researcher’s attempts at saving time and costs. A total of ( ) faxes was sent to publishing houses, software companies and feeder associations. The faxes, in the first instance, were not sent to any particular person and this may have contributed to the delay in their responding to the request for an interview. A month later, a second fax was sent to those companies and other organisations that had not yet responded and this fax was followed up by a telephone call at least one week later. Those that did respond recommended sending the fax again, this time targeting it to a particular individual, or else they informed the researcher that the fax had been passed on to a particular individual who would respond if he could be accommodated. In retrospect, making initial contact by telephone, using e-mail, or using specialist directories to ascertain key contacts would have saved on costs, in particular.

At a much later stage in the research, a further attempt was made to contact 79 companies by e-mail for possible interviews or completing of questionnaires. Seven responded positively, most providing contact names. However, on making further contact, the recommended contacts declined to be interviewed or to complete questionnaires for a number of reasons, mostly lack of time, or just did not respond.

Interviews were taped, where possible. Otherwise, notes were taken both during interviews and observations. Where personal interviews were not possible, as was often the case with several companies and feeder associations, a list of questions was sent for timely and leisurely completion. Another option made available to prospective participants was the telephone interview. This proved to be quite ideal, particularly as the conversations took place away from the place of business (often outside London and, therefore, not easily accessible) and speakers were considered to be more relaxed about participating.

There were some instances where taped interviews were not possible and where the interviewee explicitly requested some kind of questionnaire (usually in the form of a list of questions) which he/she could spend some time answering without any due pressure. This method also proved to be very useful. While this was not a questionnaire in the true sense of the word, the list was used as a proxy for the interview itself with the respondent being left free to answer the questions in as much detail as they could possibly provide. The nature of these questionnaires meant that the data collected would be of a qualitative, rather than a quantitative nature.

Each interview lasted between 30 minutes and 1½ hours.

The use of questions in qualitative research

Questions used in qualitative research in general, and in semi-structured interviews in particular, were included to provide some structure for the interview process and as a way of developing interview skills. They were also a means of collecting primary data through the exploration of various themes, although these varied from interview to interview.

The purpose of the semi-structured interview

Easterby-Smith, et al (1991) identify the appropriateness of the semi-structured interview for two reasons:

(a) for the understanding of how respondents see their ‘world’ and what constructs are used to form the basis of their beliefs and opinions about particular situations

(b) once an understanding of this world has been obtained, the researcher may then seek to influence it independently (as is the case with this thesis) or collaboratively as in the case of action research.

The often sensitive and confidential nature of the research required also confirms that this method was the most appropriate.

By using this method, I was able to ascertain through probing questions how multimedia publishing companies develop strategies and how schools responded to these companies. I found that I was naturally drawn to Whyte’s techniques as outlined by Jankowicz (1994):

Table 3: Varying the directiveness in steering a semi-structured interview

Noncommittal utterance (‘Mmm’): nod of the head	Encourages respondent to continue on same topic with minimal influence on direction of question or introduction of new question
Repeating interviewee’s last utterance verbatim	Increases the encouragement to expand point but with a questioning inflection
Probing the last utterance	Raising a question on the same point or remarking on it: interviewee encouraged to develop the point
Probing the idea just before the last utterance	More directive as it doesn’t follow the interviewee’s lead to the same extent that probing the last utterance would
Probing an idea expressed earlier in the interview	A deliberate choice by the interviewer to go back to something the interviewee said earlier
Introduction of a new question on the same general theme	More directive exercise of interviewer control
Introduction of a new theme	More directive still

After Whyte (1982)

However, when conducting telephone interviews, such visual cues were not available, hence I had to rely on verbal cues, such as hesitations (mostly on my part), natural pauses and interruptions.

Observational methods of data collection

It was originally the researcher’s intention to assume the role of the observer-as-participant, where only the status/intentions are normally made known to the group (Gold, 1958). However, from the second observation onwards this was virtually impossible, even where intentions were made clear to the class. Pupils found it very easy to address the researcher as ‘sir’, assuming that he was either a teacher or facilitator of some kind, who would be able to offer assistance in ICT projects. Robson (1993) acknowledges the questionable nature of this approach, arguing that observers, to some extent, do take part in activities being observed. The very first observation was different from the others in that it was the teacher who initiated the interaction between a very capable pupil and the researcher in which the pupil was asked to explain the process of using the software. This rather formal approach to information gathering might be beneficial in terms of the structure and direction of the observation, but normally lacks the complexity and completeness by comparison with the informal approach. Subsequent observations were more unstructured though more complex.

The role that was eventually adopted was that of participant-as-observer, where the researcher’s intentions were made clear to the class though not the status. A relationship could then be established with the group. Taking this stance meant that as well as observing ICT activities, the researcher could also ask group members questions as to what was happening in various aspects of their work.

Observational methods might be frowned upon as being questionable in terms of their subjectivity and therefore are examples of ‘bad science’ but Robson argues that

‘when working with people scientific aims can be followed by explaining the meaning of the experiences of the observed through the experiences of the observer. This arises from a perspective that the social world involves subjective meanings and experiences constructed by participants in social situations. The task of interpreting this can only be achieved through participation with those involved (cf. Schutz, 1954; 1967; Manis and Meltzer, 1967).

There are threats to research reliability and validity using observational methods, the main ones being observer bias and error. These were dealt with by adopting several strategies, as recommended by Robson (1993):

· making a conscious effort to spread attention widely and evenly, as a teacher would;

· making a conscious effort to keep an open mind, particularly when speaking with staff and pupils;

· constructing a narrative account during and after the observation to aid memory;

· ensuring that my attention was not monopolised by a particular person or sub-group.

Data Analysis Approaches

There are two main approaches for the analysis of qualitative data: content analysis and grounded theory.

Content analysis

This method has its roots in analytical thinking in the social sciences of the early twentieth century. The technique then was applied to media, beginning with newspapers, then to radio, then television. It is still used analyse media-related subjects such as pornography and violence in the media, advertising and issues of representation. While the main interest remains in mass communications, it is increasingly used in a wide variety of psychological and sociological areas (Robson, 1993). Though analytical and rational in approach, it is used in qualitative research for the analysis of historical documents such as reports and transcripts.

Advantages and disadvantages of content analysis

Robson (1993) lists several advantages and disadvantages of this method as follows:

(a) it is an unobtrusive method, where one can observe without being observed him/herself

(b) the permanence of the data means that it can be revalidated, replicated and re-analysed

(c) the method can cut down on costs, particularly where longitudinal analysis is being carried out.

Disadvantages include:

(a) limitations and partialness where documentation is concerned, in that they only deal with the ‘what’ of the data rather than the ‘why’ (for example)

(b) the purpose of publication of documents for purposes other than research means that they are, more often than not, not entirely free from bias or distortion

(c) causal relationships are more difficult to assess being non-experimental in nature; are the documents causes of the phenomena being studied, or reflections of the phenomena (for example)?

With regard to interview transcripts and other documents being used in this research, it would therefore be an ideal method. Content analysis would not be used in isolation, but as a supplementary method, as it falls somewhere between the positivist approach and the more grounded one (Easterby-Smith, et al, [1991]).

Grounded Theory

This term is credited to Glaser and Strauss (1967) referring to theory produced out of research. In relation to the generation of grounded theory, it has been suggested that

Participant observation is the most radical of all the qualitative methods, and properly used it can produce data that are enlightening precisely to the extent that they are (not) looked for.

The method ideally lends itself to the analysis of large amounts of non-standard data, as in transcripts. One is able to identify themes, patterns and categories as a result of systematic analysis, rather than have an external structure imposed on the data, as with quantitative data analysis.

Glaser and Strauss’ approach is taken further by researchers such as Turner (1981, 1983) who provides a simple methodology for processing and sifting through non-standard data. Easterby-Smith, et al (1991) simplify the process in seven steps as follows:

1. Familiarisation

2. Reflection

3. Conceptualisation

4. Cataloguing concepts

5. Recoding

6. Linking and

7. Re-evaluation.

A combination of approaches was adopted where company and organisational reports and other documents, such as learning materials, were examined alongside interview transcripts and notes.

The method used for analysing the results of in-depth interviews in schools and/or feeder organisations is based on Rogers’ classic work, Diffusions of Innovation, in which he found that a number of factors affect the rate and extent of adoption of an innovation:

1. relative advantage: the degree to which an innovation is perceived to be better than the product it supersedes, or competing products

2. compatibility: the degree to which an innovation is perceived to be consistent with the existing values, experience and needs of potential adopters

3. complexity: the degree to which an innovation is perceived as being difficult to understand or use

4. trialability: the degree to which an innovation can be experimented with on a limited basis

5. observability: the degree to which the results of an innovation are visible to others.

These are the typical characteristics that affect the adoption of any innovation. It was felt that this would be a suitable framework by which interviewees’ responses could be identified and grouped.

Barnard (1997) also provide a framework that is similar to Rogers in describing how teachers adopt CD-ROMs for teaching. She addresses the barriers that teachers move through in order to become experienced users, starting with anxiety/unfamiliarity and ending with classroom dynamics. She agrees that ‘progress is neither smooth nor linear’ and suggests that a more convoluted route might be more actual.

While her classifications have not been used for this research, many of the responses given by teachers and other staff members can be included within the process.

Coding

In order to preserve the anonymity of participants I have devised the following table which identifies the various participants:

Table 4: Participant coding

No	Institution type	Based in London?	Position
Mr (1)	Language college	Yes	Teacher/IT Co-ordinator
Mrs (2)	Primary school	Yes	Headteacher
Miss (3)	Primary school	Yes	Teacher
Mr (4)	Feeder	Yes	Staff member
Mr (5)	Independent boys	No	Director of Studies
Mr (6)	City technology college	Yes	Head of Learning resources
Mr (7)	Grammar school (Mixed)	Yes	Deputy head
Mr (8)	Publisher	No	Editor and Consultant
Ms (9)	Publisher	No	Director
Ms (10)	Multimedia	No	Marketing
Mrs (11)	Multimedia	No	Senior Administrator
Mrs (12)	Feeder	No	Director
Mrs (13)	Multimedia	Yes	Director
Dr (14)	Multimedia	No
Miss (15)	Multimedia	No
Miss (16)	Secondary Girls	Yes	Head of Maths
Miss (17)	Secondary School	Yes	Librarian
Mrs (18)	Grammar school (Girls)	No	Head of ICT
Mrs (19)	Primary school	Yes	Headteacher
Ms (20)	Feeder	No

Results

The in-depth interviewing of the various respondents revealed several issues faced by schools in planning for, implementing, and using CD-ROMs for learning. These issues can be grouped under the following headings:

· Relative advantage: ‘the good ones’

· Compatibility: ‘copy and paste’ syndrome; ‘piracy’;

· Complexity: ‘networkability’

· Trialability: ‘try before you buy’

· Observability: ‘feedback’; ‘attitudes’; ‘benefits’

Relative advantage: ‘the good ones’

A few companies were singled out for praise of their products.

Yorkshire International Thomson Multimedia (YITM)

YITM, who actually produce CDs for specific topic areas, and I used to be a history teacher, so I’m quite familiar with history CDs from YITM, and their choice of subject, their choice of language, their display are, as I can work out, as in the main being reasonably accurate. They actually create the materials that are targeted to specific use with the National Curriculum and are designed in a manner that’s relevant to the age group they are working with. (Mr [4])

...some of them are not that well put together actually. Actually, some of the American imports are not very well done and, of course, (FR prompts) have an American bias to them, yes. I know how much it costs to put a CD together, so I know they are expensive things to produce. I think they might actually be produced better. One of the better education suppliers is YITM. They’ve just been taken over by Granada. Their material is actually good and its educational...and it is British. So in education, they’re one of the better suppliers. (Mr [6])

Microsoft

The ones that we use...Encarta...are quite user-friendly (Mrs [18])

I find that Encarta is just as good for Maths...visuals.. quite nice...quite specialised... (Miss [17])

The British Library

There is an understanding among developers now as to what schools require. For example, the British Library’s Making of the United Kingdom. It is absolutely matched to History (Ms [20]).

On the other hand there was some disagreement over some companies, for example, Dorking Kindersley:

...Dorling Kindersley are very good... (Miss [17])

...when you look at My First Amazing World Explorer, when you copy and paste text, it gives you a screen dump of the text and you can’t edit it. Now there to me is a perfect example of a manufacturer not being aware of the audience. Now we have a relationship with Dorling Kindersley; we alpha test and beta test some of their material. And one of the things which we said to them when they did My First Amazing World Explorer was the inability to download text in an open format so that you can do things with it was a serious limitation on achieving attainment requirements of the National Curriculum. So if you look at World Explorer 2, the text is downloadable in an open format. I know I’ve been criticising Dorling Kindersley but they are listening. (Mr [4])

Compatibility: ‘copy and paste syndrome’; ‘piracy’

Teachers were also asked as to whether or not the products they were using met National Curriculum needs and requirements. A common problem faced by teachers in most schools (and confirmed by interviewees) is the ‘copy and paste’ approach of pupils in using information technology to complete assignments. According to Mr (6):

The biggest danger is the students will simply find the information and print it out, without actually learning. They know how to find information, and they’ve learnt how to print. And they will take away 20 pages or so, say, from the encyclopaedia, staple it, and hand it in as their project. There’s a bit more sophistication than that but that is one big problem - how they actually use the information and that’s an ongoing thing. Because CD-ROM is the answer to everything...that they think now the Internet is the answer to everything and they go on the Internet...pick up the information, and print it out...They haven’t developed the sophisticated search and study skills which are really required and that’s going to take some time.

This was confirmed by Miss (17):

...(pupils) use the CD-ROMs to find information and they have to know what they’ve been asked to do on the CD-ROM, you know. I mean, the first lesson today they were printing out a lot of pictures, and nothing else, which, basically I don’t like them doing because they’re not learning a lot. I prefer it structured like it was in the second lesson; and also, you know, if you’ve got a restriction on the printing, because every time they print...they don’t know anything about the subject.

And Mr (7):

There’s a great tendency to pull off a screen, print it out and say ‘That is what we’re going to do’., and they confuse printing off a computer with learning. That is something we have to tackle.

Because of the nature of digital information, it didn’t really matter whether the information was on CD-ROM or on the Internet, pupils were prone to copying and pasting information (sometimes large chunks) into reports and manipulating the information in such as way as to present the work as their own.

In dealing with this issue, Mr (4) used the term ‘bridging the gap’ to describe the work they do in ensuring the learning process is valid. The staff member interviewed has a teaching background and, thus, had some experience of pupils using the ‘copy and paste’ approach. He felt that if companies took on board the need to provide effective learning materials with their products, teachers would ‘fall at their feet’:

...if the educational CD producers actually did this stuff as well, then teachers would fall to the ground, with grateful tears gushing from their eyes, blessing (named company) and raise them to the status of god... We’re involved in bridging the gap between what the people make and what the teacher needs to do. And what people make should be, in some ways, determined by what teachers need to do because they do not do that...

Ms (20) was concerned about companies providing extraneous information on CD-ROMs which clouds the child’s learning. She identified this aspect as a key difference between the education and home markets and called for software to be produced that would support structured learning environments.

With regard to the American bias of CD-ROMs:

...some of the American imports are not very well done and, of course, have an American bias to them, yes. (Mr [6])

Schools have very limited budgets and teachers’ values may appear to be absent with regard to software piracy. Mr (5) remarked:

There is one which I have got which I just been using recently called Test for Success Geography Key Stage 3 recommended by Carol Vorderman and I have been able to use this on one machine and then spread it around on the others. So it reads to one machine but I can download the software on to another machine. Probably illegal. Probably, pirating. I should have one of these disks per machine. But we’re a school. Schools aren’t wealthy and this costs £19.99. I haven’t the budget to spend £19.99 times 12 – I don’t have that budget.

He further stated that:

...by putting this on to a computer and allowing several children to use it simultaneously, I am acting as a salesman for this particular product. I guarantee that I know that there are several children who’ve been out and bought this subsequently as a result of me running it on my network.

He went on to suggest that the home market overlaps with the school and that companies need to rethink their strategies and provide free software to schools knowing that the home markets would be reached through the schools market. The empty cartons in which the CD-ROMs had been bought were never thrown away; they were displayed for all to see, thus providing a free showcase of companies’ products.

Complexity: ‘networkability’; ‘compatibility (of hardware/software)’

A common problem with CD-ROMs has to do with their networkability. This is partly due to (1) the publisher not building networkability into the products and thus enabling schools to purchase network licenses, (2) the lack of IT skills and knowledge of teaching staff who are often appointed without sufficient training provided and (3) teachers not having the knowledge to distinguish between site and network licenses.

One of the problems there is not all CDs will work on a network. There’s either too much video or sound, or both. So we have to look quite carefully at what is available for a network, as distinct from popping into a shop and buying a CD which might work on a computer. (Mr 6)

They don’t network...and especially at the moment if you try to write to the hard drive then they don’t network and this seems to be something that the Americans have no doubt...quite regularly...CD-ROMs ...we tend, we try and control this through...tell the staff not to buy anything without consulting...because the staff still don’t understand the difference between standalones, site licenses and network licenses...CD-ROMs ... they buy an £85 CD-ROM and...run on the network... (Mrs [18])

...a lot of the computers are not compatible with these computers...but that is a problem because if they do the work up there they can’t print it out down here and things like that (Miss [17])

Some CD-ROMs are remarkably difficult to get to work with. Also some CD-ROMs knock over too many files when they’re setting up…They say 'Do you want to re-write?’…what they don’t say is they’re going to delete it or change lines in it and so say to somebody, ‘Here’s a CD-ROM. They say, ‘What do I do?’ You say, ‘Type in D:\setup’. They run D:\setup. When running D:\Setup, we’ve had a couple of occasions where CD-ROMs have knocked out other CD-ROMs and then either I myself and technicians had to go and put the machine back in so that it works. That becomes an irritation. (Mr [7])

With regard to quality and general difficulties of using CD-ROMs:

...it’s difficult to find your way around the CDs then we can get into all sorts of problems, and some of them are not that well put together actually. (Mr [6])

The other key problem I have with CD-ROMs is the variable quality of CD-ROMs and of actually the usefulness of them. Some of them are frankly useless, despite what they claim to have. Some of them are hopelessly unsuitable. The problem is that only by using them do you discover this. (Mr [5])

Error messages were seen as an issue by Mrs (20). Software developers often use error messages that are more appropriate for adults and teachers have to deal with these. If the average class size is taken into consideration, this would amount to 30 error messages per class session. This is time-wasting. Publishers, she said, need to build verbal feedback into their products as well as visual.

Access

One school I went to had a small number of computers which meant that each session only lasted 30 minutes.

Trialability: ‘Try before you buy’

This strategy enables schools in their planning for CD-ROMs. While teachers’ time is at a premium, some school administrators need to have justification before investment in particular products can be approved. Some companies have strategies for trialability:

A great deal of companies now sell on terms, so you can have it for a limited time and then you can send it back. Which is good, because although the title seems to be quite appealing, when you actually get it, and you look at it, it doesn’t cover quite what I was expecting it to cover. So we do really have to see the CD...work out whether it’s actually really what you want. And also...whether the information is going to be accessible to the students. (Mr [6])

...maybe as Sherston Software do...they’re an educational software producer...’we’ll give you a month’s evaluation and we’ll invoice you within a month. If you send it back within a month we don’t invoice you’. Maybe they ought to have a scheme like that. Maybe they ought to do that. (Mr [4])

Mr (5) had a rather unique approach:

The best way to get round this problem (of quality and usability) is to use the cover disks on magazines. I buy a lot of magazines and use the cover disks ruthlessly and I will check a lot of the software on the cover disks. That is a brilliant way of being able to test out the disks…the cover disk magazine type of CD-ROMs are brilliant for teachers…

He also confirmed a problem that many teachers have in schools: lack of time to evaluate software products:

There is physically not enough time to see the CD-ROMs we want to use. This is a major drawback for a school. I may run an IT department, but I also run Senior Geography. I am also responsible for the academic level of the school, timetabling, cover, etc. There is physically a limited amount of time I have got to look at CD-ROMs. Additionally, I only teach two subjects. How can I vet a Mathematics CD-ROM or a Science one? I can’t. So the Heads of Departments, or the teachers have to look at the CD-ROMs. So what I have done in the past is to say to teachers “If you want to have a CD-ROM, order it, get hold of a copy, you know, a demo, or whatever, or a trial copy. I’ll install it for you, you can then test it yourself at your leisure”, and that’s the policy we work..

Ms (20) confirmed teachers’ lack of time, although they are versatile:

‘teachers don’t have time...teachers develop their own materials, or wait for materials to come along’.

Also Miss (17):

It varies...a lot of time; they don’t have a lot of time to sit and look at them. I think they are wary of them for that reason...Science...I think most of them...want to use them...

This has implications for publishers seeking to reach their target markets. Not very many companies use sales reps. While there are exhibitions such as BETT and The Education Show, publishers are generally nor proactive in visiting schools.

The ‘limitlessness’ of CD-ROMs compared to books was also seen as an important issue by Ms (20) with regard to teachers’ planning and preparation time. Once a book has been read, a teacher, usually knows what h/she wants to teach. With a CD-ROM, there is not as much focus. Again, Mr (4)’s point about publishers providing effective learning materials with their CD-ROMs is pertinent. Companies need to bridge the gap between what is made and what the teacher wants to do with it.

Observability: ‘feedback’; ‘attitudes’; ‘benefits’

When asked for staff and pupil attitudes towards CD-ROM in terms of feedback and perceived benefits:

I think they (the teachers) appreciate what CDs can offer. ...They (the pupils) like using them. They will sit and browse through...you put a new one in - ‘oh! it’s new’ - they’ll hunt around and check it out. They like seeing what’s there. They like to explore...

In terms of actually using the resources down here in the Learning Resources Centre...they (special needs pupils) have as much access to it as anyone else...We’ve got a few of the weaker ones who come in and do their work. They get on quite well with it. It’s amazing actually...(Mr [6])

The interviews conducted with the various learning software publishers concentrated on questions of strategy and product development. Their responses were grouped under the following characteristics of the rational-emergent paradigm:

Table 5: Characteristics of the rational-emergent paradigm

Rational-Planning	Emergent-Learning
Use of planning tools	Experimentation and creativity
Strategy in formal document	Challenging existing practices
Selection of appropriate strategies	Documentation of learning process?
Implementation of strategies	Reflective practice
Monitoring of strategies	Use of different perspectives
Mechanistic structures	Organic structures
Strength of financial controls	Strategic control (decentralised)
Strategic planning (centralised)

Discussion

Previous research into CD-ROMs in schools

In 1992, BECTa (or the NCET as it was then known) carried out heresiarch into CD-ROMs in schools under the CD-ROM in Schools Scheme. The authors of the research identified two key issues: location of the CD-ROMs (usually in the library or learning resource centre, followed by the IT room, and which dictated the use of CD-ROMs) and availability of software, which at the time was inadequate. The growth in the number of available titles and computer networks in schools ensured that these issues were addressed.

In 1997 a review of the range and quality of learning software available to schools was carried out by the DfEE’s Curriculum IT Groups. This review was managed by BECTa and the results published in the Review of Software for Curriculum Use.

Several concerns were raised, as follows:

· the importance of linguistic usage and vocabulary being properly matched to the developmental stage of the target pupil group;

· the importance attached by teachers to the availability and quality of software teaching support materials;

· the need for depth, as well as breadth, in content;

· the value placed on teacher involvement in software development and improvement;

· the increasing importance of platform independence, and

· a concern, not always fully explained, over the prevalence of American linguistic usage and cultural assumptions.

Barnard (1997) carried out a longitudinal study of the uptake of computer-assisted learning in further education. While the context was different, the issues were similar to that of my own research and can be grouped under Rogers’ afore discussed categories. They are nonetheless alluded to in the responses of the research.

She discusses the process whereby teachers progress from being non-users to being experienced users:

· Anxiety/unfamiliarity (complexity; trialability)

· Resourcing (complexity)

· Perceived usefulness (relative advantage)

· Personal philosophy (compatibility)

· Influence of colleagues (observability)

· Classroom dynamics (all).

Her model has been illustrated as below:

She argues that classroom dynamics was most important for its impact on all of the other obstacles teachers needed to overcome in becoming more experienced with new technologies and is currently researching the extent to which decisions about new technologies are made while they are in use in the teaching process.

My own study set out (1) to establish the strategies of learning software publishers, whether rational or emergent and (2) to determine whether or not there was a mismatch between publishers’ perceptions of market potential and actual demand by customers.

Strategies of learning software publishers

It was found that strategy formulation and implementation was largely dependent on the organisation’s size. Larger companies had formal systems in place but were not so rigid as to prevent change in response to changes in the external environment. Smaller companies tended to concentrate on product development with very little market research and customer care. This was largely due to lack of resources in terms of personnel and time. It is also to be noted that deliberate organisational processes are of less central importance to smaller firms than larger ones (Tidd, et al [1998]).

The research identified major difference between traditional print publishers who had ventured into multimedia and the new technology software houses.

Possible mismatch between publishers and school-customers

The study found that there was indeed a mismatch between publishers’ perceptions and market demand in the following areas:

Lack of adequate learning materials to bridge the gap between product launch and product use

Not being aware of audience needs in terms of use of error messages, functionality

Possibly misleading use of the term ‘National Curriculum’ on products and product literature

Inadequate after-sales service

Inadequate end-user involvement, including testing and evaluation

BECTa’s web site (which includes the National Grid for Learning web site) carries extensive information on software evaluations which would be of use to teachers who do not have time to evaluate products. The evaluations are done by teachers and librarians. Other organisations involved in software evaluation include TEEM (http://www.tee.org.uk) and the Parents Information network (PIN).

The value chain in electronic publishing

Porter (1985) developed the value chain model as a mechanism for examining the value a company creates against the costs associated with creating that value, and is a development of his earlier work in 1980 on industry structure. He contends that a firm must consider itself part of a wider system in its search for competitive advantage. The developer of learning software must be aware of the value added to the product right from raw material procurement and its subsequent modifications till it reaches the hands of the customer, and, within this process, analysing the strengths and weaknesses along the stages of its product flow. In each stage a particular activity is performed that adds value to the product. It is important to identify those areas where the company's strengths and weaknesses lie.

Bide (1997) provides a generic publishing value chain built on Porter’s model which he found of limited assistance in understanding the publishing industry.

The model has been adapted to illustrate how the electronic publishing industry operates. It must be noted that there are five generic stages of product development in electronic publishing which differentiate it from traditional print publishing, in that the consumer is (usually) involved in the process from the outset, and in which testing and evaluation – which are central to product development - can take place:

a) The Basic Idea

b) Alternative Design(s)

c) Prototype Implementation

d) Completed Product

e) Post-Product Launch.

The core activities described below under each stage are activities and not functions. Bide also acknowledges that, in some cases, there is cross-functionality of these activities which may also run concurrent with or over the product development stages and suggests that the analysis is only, therefore, meant to act as a guide.

The following discussion includes material from previous study, as well as material supplied by learning software publishers.

Evaluation of the basic idea

The aim of this stage is to consider issues of functionality and usability and to ascertain whether an idea is viable. Here questions are asked such as: what are we trying to say? will the customer understand what the product is? how will the product be used? will it need supporting materials? which platform/format? available hardware specification of target market?

The key parties involved are usually

· the user-interface design team

· marketing and finance, and

· hardware engineers.

The information required at this stage includes characteristics of target market, constraints on design, and customer perceptions and expectations. This can be ascertained from focus group meetings with the consumers, for example, as well as conducting a stakeholder analysis, where the customer decides what he/she does or does not want in the product, or the company investigates how the target market implements and uses products. Axelrod (1975), Calder (1977), Freeman (1984) and Krueger (1994) have contributed much to focus group and stakeholder analysis research.

Once a decision is made, and presuming that the project has been approved, the following core activity can take place:

· Content acquisition: this is the process whereby content is acquired by the developer from selected creators; the content may be sourced and selected, its value assessed and the rights to use it negotiated. Also known as data capture, it involves the acquisition of the discrete media elements, whether they be text, graphics, video, or other images, to be used in the product.

Evaluation of alternative design(s)

· The aim here is to choose between alternative designs and to predict, from a design, how good or bad a product will be. Some questions which might be asked would include: is the data structure consistent with software requirements? does the algorithm accomplish the desired function? is the algorithm logically correct? is the interface consistent with the architectural design?

· The key parties involved are mainly the user-interface design team who usually require the following information: support of functionality, logical dialogue structure and screen layout.

· Once the best design, that is, the design which is closest to meeting user requirements, has been selected, then it is time for:

· Content development: the media elements are enhanced through editing, using high-powered graphics, sound-editing, image/video-editing software or other activities such as picture/archive research.

· Product development and design: the process through which the eventual form and appearance of the final product is conceptualised. This activity may be also be taking place simultaneously during the design evaluation and choice stage.

· Project management: all activities relating to costings, quality and time-to-market of the product.

· Content formatting: this is the preparation of content for the prototyping stage and is often done using authoring tools such as Director, Visual Basic, Delphi, HyperStudio, Klik and Play, HTML, etc.

Evaluation of prototype implementation

The aim of this stage is to carry out evaluation and feedback. Some questions to ask would be which metaphor would be best? which of the four icon designs should be used (resemblance, examplar, symbolic, arbitrary)? did the customer like this screen layout or that one? does the system design conform to legal standards? how well does the prototype support the kind of activities that the customers do in their normal work environment?

The key parties involved are the user-interface and system design team and the target customers who are involved in the testing and evaluation of the product. The team needs to ascertain the extent to which prototypes meet a range of functionality and usability criteria. Once this has been achieved, a statement of the extent to which usability goals have been met and a series of evaluations of specific aspects of the product.

Evaluation of completed product, prior to launch.

This stage involves evaluation of the product as a whole and beta testing. The following questions might be asked: what methodology/ies might be suitable for usability testing? have the major test phases been properly identified and sequenced?

is the test plan consistent with the overall project plan? how many users are needed?

The target market groups are the key people involved and the designers, along with researchers, may adopt various testing and evaluation tools and techniques such as cognitive/user walkthroughs, error analysis, verbal protocol analysis, etc., in order to gather sufficient information on how the product performs in real-life situations. It is during this stage that there will be an identification of major problems or minor bugs with along possible enhancements/modifications.

Core activities which may be carried out at this time might include:

· Marketing: These are customer-centred activities which take marketing principles and put them in practice, for example, the classic 4P’s – price, place, promotion and product.

· Promotion: This may be done prior to the launch, or after it, depending on the company’s strategy, and is designed to stimulate sales through advertising, leaflets, brochures, catalogues, point-of-sale (this may depend on the type of retail outlet), reviews, etc.

Post-product launch

At this stage, mechanisms would have been set up to monitor response of customers, reviewers, etc. The main question which might be asked is what mechanisms (if any) are in place to nurture the user community? This covers a multitude of sins, as it were and might include strategies such as on-site/on-line consultancies, focus group meetings, newsletters, and tracking user-error frequencies. These are some of the guidelines suggested by Shneiderman (1992). The key people involved would be the user-interface design team and marketing. Customers may be visited to see how they are using the software. Information such as the attitudes of customers and reviewers, etc., as well as nature and level of use of the product would be gathered in order to provide inputs to a new cycle of product definition and development.

Core activities running alongside the post-product launch would be:

· Sales: activities designed to convert promotional activities into actual transactions.

· Manufacturing: activities which replicate the product, administer the completed sale and deliver the product to the customer in exchange for monetary value.

· Warehousing: the management of the storage of replicated products prior to sale.

· Customer service: customers may be directly involved before, during or after the sales cycle

· Other revenue sources: like traditional print publishing, this may involve activities which would generate revenue from other sources, such as, licensing, advertising sales, mailing list sales, complementary activities, such as conferences and seminars, etc.

Implications for publishers of learning software

A study by Draper (1997) into successful applications of CAL in Higher Education suggests that

The best cases of applying CAL to improve learning will combine a) an identification of a real pedagogic problem; b) a pedagogic theory of how the educational intervention is a solution to the pedagogic problem; c) a neat bit of CAL design.

From this, there are several implications for publishers of learning software products:

Publishers need to do extensive research into their target markets. This often involves the inclusion of end-users in product development, ideally from the very beginning. The use of focus groups, stakeholder analyses and other techniques can help publishers meet users’ expectations and contribute to meeting National Curriculum needs and raising standards in education.

Publishers need to understand the importance of evaluation in the software development process. Evaluation is important as it ensures that intended designs match users' needs and preferences thus enabling users to work more productively while minimising their cognitive load. Another use of evaluation is that, properly done, evaluation can offer benefits over competitors' products. Evaluators can include teachers, evaluating organisations (such as TEEM), children, parents, educational experts, etc.

Publishers need to plan for evaluation

Publishers need to address customers’ needs by adding value to their products, such as activity sheets which address the requirements of National Curriculum subjects

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Appendix

Company Profiles

Dorling Kindersley

In 1991 Microsoft purchased a minority stake (originally 26%) in DK, both companies entering into a strategic alliance to create interactive educational multimedia CD-ROMs. The alliance seemed useful to both parties in that Microsoft had access to DK's picture library of over 5 million photographs and images while DK had access to Microsoft's CD-ROM production technology and became a market leader to be contended with. In order to finance its multimedia production activities, DK floated on the Stock Exchange in 1992.

Four years later, in November 1995, Microsoft sold its now 18% stake in DK. The reason cited by both parties for the parting of the ways was that each had different ideas about what they wanted to achieve; Microsoft wanted huge productions and DK wanted to be a multimedia publisher in its own right rather than a sub-contractor for Microsoft.

DK adopted a new strategy earlier in 1997 when it entered into a co-publishing deal with Inner Workings, a company which floated on the Alternative Investment Market (AIM). The first project, The Jolly Post Office, was released in May. It has also entered into partnerships with Disney and Intel. Later in the year, the company acquired Acacia Interactive, publisher of curriculum-based CD-ROMs. A new range of software was published under the brand name 'DK Acacia'.

The DK philosophy is to provide beautiful, accessible and entertaining products while giving value for money. Its distinctive use of white space in book production has also been carried over into multimedia production for both its CD-ROMs and Web site.

Oxford University Press

OUP is the second oldest publisher and the fourth largest in terms of sales. It's first venture, the Oxford English Dictionary on CD-ROM was produced in conjunction with AND Technology (now called AND Publishing), a software company. The electronic publishing division is part of the science, medicine and journal publishing group, which gives it a vantage point for distributing information on CD-ROM or on-line from its journals and reference works. While OUP has invested heavily in the National Curriculum, it is not yet clear (at the time of writing) whether it will produce (or has produced) any National Curriculum-based CD-ROMs for the schools market.

Thomas Nelson (UK) Ltd

This division of International Thomson Publishing is the company’s educational arm. It acquired Newcastle-based multimedia company, Interactive Learning Productions Ltd (ILP), in 1993. ILP (initially called the Interactive Learning Project) came out of a project set up in 1986 at the University of Newcastle upon Tyne with an aim to address the application of new technologies to education. The actual company (including name change) was formed four years later and grew from a staff of six to over 50 in 1993 when Thomson took it over.

ILP has won several major multimedia awards and claims to be the UK’s largest and most successful multimedia production company.

Specialist multimedia publishing houses

Several multimedia publishing houses such as Yorkshire International Thomson Multimedia (YITM), Ransom Publishing, Xemplar and CUC Software International, are examples of a new breed of electronic publisher who have seized opportunities which traditional publishers have either failed to capitalise upon, or they simply do not have the resources to do so. Unlike traditional publishers who thought that 'good book equals good CD-ROM', they have not used the books-on-disc approach. Again, with a specific reference to producers of curriculum-based CD-ROMs, a brief profile of each company follows.

Research Machines (RM)

RM is the leading supplier of IT to the UK education market, having held the coveted position for four consecutive years and supplied the market for over 20 years. The company has well-established links with educational associations, as well as a strong partnership with schools. Besides providing curriculum-based software, other strategies include providing curriculum networks, integrated learning systems for the development of numeracy and literacy as well as video conferencing, management information and portable computing systems.

YITM

YITM was set up in 1995 between Yorkshire Tyne-Tees Television and International Thomson Publishing and its core business is the education market for which it publishes curriculum-based CD-ROMs. It enjoys a 61% penetration of schools which have multimedia capabilities. To date, the company has about 24 titles in retail and like other educational publishers, seeks to differentiate its products from those under the label of ‘edutainment’.