“Wikipedia is already a much better encyclopedia”

mm…I wouldn’t go that far. If I want to read 3000-word entries discussing the sexuality of Dragonball Z characters, Wikipedia is great, but for any real research I’d much rather have a citation to Britannica.

dataGuy,

Let me elaborate on what I said above.

The simple story is that the two companies talked about a partnership and never came to terms they could agree on. Britannica passed on a partnership with Microsoft because the terms Microsoft offered weren’t acceptable. Similarly, Microsoft passed on a partnership with Britannica because the terms Britannica offered weren’t acceptable. It happens in business every day: companies talk, they don’t get to yes, and they go their separate ways. It’s not particularly interesting or revealing.

With this story, of course, the usual overlay is that Britannica passed on the partnership with MS because Britannica didn’t foresee that digital encyclopedias would displace print. In this telling of the story, Britannica thought they could just continue selling print and ignore electronic publishing. That’s the gist of the story, and it’s false.

My sources are a combination of first-hand experience (I was at Britannica at the time and aware of the work toward electronic product development that was under way); the notes of people here who were involved in the Microsoft talks; and discussions with some of these same people years later, when the false account of the negotiations first emerged.

A brief digression, but a necessary one. The Kellogg case you link to is riddled with errors, not the least of which is the assertion in the second paragraph that Britannica declared bankruptcy. This never happened; I don’t even know where the authors of the case got the idea.

Given this, however, it doesn’t surprise me that the Kellogg case uses as its main source for the Britannica-Microsoft story a mid-90s book entitled The Microsoft Way. To the best of my knowledge, this book is the original source for the story you allude to. The author of that book had one goal: to write a paean to Microsoft at a time when the Redmond hegemon was on top of the digital world and it appeared to some they might rule it forever. He, the author of the book, that is, almost certainly got his information on the Britannica-Microsoft talks from someone at Microsoft, and I am fairly confident he never talked to anyone at Britannica to check the version of events he presented in the book. (Had he called here he would have been routed to me.)

If he had checked with Britannica he would have found out that far from being oblivious to the prospect of digital encyclopedias, Britannica had, by the mid-1980s, already published one and was preparing to develop others as the installed base of computers grew. (Interestingly, one of the other facts the Kellogg case gets wrong is the implication that Grolier’s mid-80s CD-ROM was the first electronic encyclopedia. It wasn’t. Britannica published an online version of our encyclopedia in 1981 for Lexis/Nexis subscribers. It may have been the first electronic encyclopedia; it may not have. I don’t know of an earlier one.) That Britannica turned Microsoft down out of indifference to digital technologies was simply somebody’s spin — somebody at Microsoft, I can only conclude.

As for what happened next in the marketplace, yes, Microsoft was the big player in the CD-ROM market in the 1990s and banged us around some, though we did manage to capture decent market share eventually. How did they do it? In essence by giving their encyclopedia away — in OEM bundles and “net-to-zero” rebates in retail. They did this because they could afford to do it, and at the time having a widely used encyclopedia along with all their other software assets fit with their strategic aim of maintaining control of the desktop operating system. I don’t say this to complain, just to point out that Microsoft beat us then because they had deeper pockets, not because they saw the digital future sooner or more clearly than we did.

Britannica spent the 1990s transforming itself from a print publisher to a digital publisher with some print products. The task consumed the company’s energies for most of a decade, in the course of which we did a number of things right. We also did plenty of things wrong, but failing to see that encyclopedias should and soon would be primarily digital wasn’t one of them. I’m pretty sure we saw that and acted on it before anyone else.

And yes, as you say, the story of our putative cluelessness in the face of Microsoft’s offer has been repeated often. But such is the nature of truthiness, is it not? That’s why I compared the story to the hilarious bit about Texas and the beer recipe. That one is so widespread on the Net it must be true, right? Except that it’s not.