WASHINGTON — Edgar, the vast government database on companies across America, is a treasure house of public records. But it's been criticized as relatively inaccessible and too expensive.
The recent experimental link of the Security and Exchange Commission's Edgar database to the popular Internet computer network provides an important new means for affordable public access.
Before this inexpensive computer link, people had to visit one of the SEC's public reference rooms in New York, Washington and Chicago to use the database. Or they would pay a considerable amount of money to private businesses who sell the government data to the public.
According to James Love, director of Taxpayer Assets Project and a persistent SEC critic, the problem is the SEC designed a distribution system that favors corporate clients instead of the public.
Thomas Vos, vice president of the financial printing company Bowne & Co. in New York, agreed that the distribution side of Edgar needs improvement.
John Lane, the SEC's chief information officer, defended the SEC's system as sound but admits Edgar distribution is in its infancy.
Lane said he "had expected to see more retail services at this point" based on the Edgar database but figures there haven't been enough companies listed on the database to inspire private industry to develop new products.
Edgar contains annual reports, proxy statements and other important information from one-fifth of the 15,000 companies that report to the SEC. All companies will come on line by 1997.
While a document downloaded from the Internet site costs only a few dollars, a paper copy of the same document would cost more than $50 from a leading SEC data vendor, Disclosure Inc.
Love, whose group is affiliated with consumer activist Ralph Nader, takes particular issue with the SEC's contract with Mead Data Central of Dayton, Ohio. Mead has a $72 million SEC contract to sell the Edgar information on a wholesale basis to other commercial vendors.
Love maintains that Mead has little incentive to provide inexpensive public access to the Edgar files, since the company already makes considerable money selling a separate stream of SEC data to corporations on its Nexis-Lexis database.
Industry analysts say the SEC information is a small but valuable product for the Nexis-Lexis database, the backbone for Mead's electronic publishing business, which had 1993 sales of $551.3 million.
Mead spokeswoman Judi Schultz said Mead's market isn't the casual individual consumer, but intensive users of information such as law firms, large news organizations and investment banks.
Schultz also denied Love's charges that Mead has a conflict of interest since it has the wholesale Edgar contract and also sells SEC information on Nexis-Lexis. The SEC regulates and audits the wholesale prices Mead charges for the Edgar data.
One reason consumers may have been slow to gain affordable access to Edgar has been the upheaval in the industry.
Disclosure Inc., a leading SEC information vendor, last February acquired data vendor SEC Online of Hauppauge, N.Y., and in 1991 bought Bechtel Information Services Inc., the provider of paper and microfiche copies of SEC filings to the public.
But consumers may see more low-cost offerings of the SEC documents in the wake of the Internet link to Edgar, industry officials said. Both Disclosure and Mead say they're studying how to distribute SEC filings to individuals.