Periodicals Price Survey 2008: Embracing Openness
Global initiatives and startling successes hint at the profound implications of open access on journal publishing
By Lee C. Van Orsdel & Kathleen Born -- Library Journal, 4/15/2008
They have argued about it for years. It's been touted as the liberator of information that wants to be free, the arbiter of shared intellectual property rights, and an engine that can drive discovery, invention, cures, and economies. It has also been vilified as an assault on capitalism, a catalyst for the collapse of responsible publishing and the rise of junk science, and a naïve invention of some pointy-headed idealists who have no idea how the real world works. “It,” of course, is open access (OA).
Evidence for open access as an emergent, global state of mind is everywhere. The New York Times went “open” last September, and the Wall Street Journal is slated to follow. Increasingly, scholarly communities are breaking with tradition and calling for the open sharing of research, software, and data. In amongst these global initiatives is the campaign to provide open access to the results of research that is funded with public dollars. That campaign has produced a series of startling successes in recent months, with potentially profound implications for the journal publishing industry.
First came a long-awaited mandate, signed into law on December 26, requiring the National Institutes of Health (NIH) to provide open access to grantees' peer-reviewed research articles within 12 months of publication. As blogs hummed with speculation about how libraries would be affected and whether publishers would take it to court, another shoe dropped. The European Research Council announced the first European Union (EU)–wide mandate on January 10, calling for grant recipients to put research articles and supporting data on the web within six months of publication. As that news was being absorbed, 791 universities in 46 European countries voted unanimously to endorse OA mandates for faculty at their institutions and to support other mandates for access to publicly funded research.
The OA tsunami crested on February 12. In a move few anticipated, Harvard's Faculty of Arts and Sciences voted unanimously to give the university permission to post their scholarly articles in an institutional repository. The policy requires faculty to retain the right to archive their peer-reviewed manuscripts when signing publisher agreements (though faculty can get a waiver by asking for it in writing). About two-thirds of publishers already grant such permission. The one-third that don't currently allow self-archiving will find themselves in a tough spot—conform to the mandate or lose the work of Harvard authors. Harvard's is the first university mandate in the United States and the first anywhere to be initiated by faculty rather than administrators. Therein lies its importance. Through its mandate, Harvard faculty voted for more control over their work and for the right to use and share it widely as a social good.
Alternatives on trial
On other fronts, the pace of publisher experimentation with open access and other alternative publication models picked up a bit in 2007, with CERN's SCOAP3 project attracting the most attention. A few journals with interactive, Web 2.0 features were launched by large commercial publishers. The number of hybrid OA journals grew, and their overall efficacy as a transitional model seemed more certain. We also saw experimentation on a smaller scale, with publishers looking for better/simpler journal pricing models and ways to trim the cost of sales. Like their library customers, publishers continued to grapple with the costly practice of running dual systems for print and online. Rumors of mergers persisted—Elsevier and Kluwer Health, Springer and Informa/Taylor & Francis, Springer and CSA/Proquest—and were persistently denied by company spokespersons. There was little relief to be had from the high cost of journals, with Oxford University Press offering the rare exception when it used income from author fees to reduce subscription costs in its hybrid journals for the second year in a row, just as it promised.
This year's Periodicals Price Survey will look at these and other issues shaping today's journals marketplace. Three Institute for Scientific Information (ISI) databases—Arts and Humanities Citation Index, Social Sciences Citation Index, and Science Citation Index—provide the titles used in the study. In addition, we include data on titles in EBSCO Publishing's Academic Search Premier. The data are limited to prepriced titles (as opposed to standing-order or bill-later titles) that can be ordered through a vendor and are current as of February 8, 2008.
A really big mandate
The NIH mandate made news both because of its size and because NIH sponsors the best-known OA database of high-end medical research in the world, the National Library of Medicine's PubMed Central. NIH dispenses $29 billion a year in grants, resulting in some 80,000 journal articles that are coveted by STM journals for their prestige and impact. Those STM publishers that reportedly sank millions into lobbying against the mandate have been quite vocal in their criticism of it.
Before NIH even posted its operational guidelines, statements from theAmerican Chemical Society (ACS), Professional/Scholarly Publishing division of the Association of American Publishers (AAP/PSP), and International Association of Scientific, Technical, and Medical Publishers condemned the measure, claiming among other things that it takes away the intellectual property rights of publishers without compensation and threatens the practice of peer review.
The facts, please
Guidelines published by the NIH describe a different reality. Adherence to copyright law is required. A grant recipient receives public monies to conduct research in a health-related subject. In exchange, the recipient agrees to post in PubMed Central the author's final copy of the peer-reviewed manuscript that has been accepted for publication. The deposit happens immediately so metadata can be created to aid discovery by other researchers. The text of the article, however, is embargoed for up to 12 months in respect to the publisher's investment. The policy says nothing about publishers or their business models. In fact, publishers are not involved in NIH grants until the very end of a long process of research and writing and then only by choice. It is hard to see how publishers can contest the measure on legal grounds. At most they may delay its implementation by request for judicial review. Based on the recent run of anti-OA PR campaigns that backfired, it is sure to be an interesting process.
When Harvard speaks...
The terms of the Harvard decree are similar to those of the NIH's, but publisher response is more muted—perhaps because it was created by the very scholars whose manuscripts fuel the current publishing system. For years, scholars like these have unhesitatingly signed agreements that transfer virtually all copyrights to their publishers. Publishers benefited financially from the ownership of these rights, which they guarded on behalf of both the authors and themselves. The new edict threatens the traditional order of things, but in so prestigious a setting and with such lofty idealism that it is hard for publishers to criticize. If other universities follow suit, the Harvard mandate may well end up as a for-profit publisher's biggest nightmare—the hole in the dike through which a deluge may pour.
A fiasco called PRISM
Active resistance to legislative mandates for access to publicly funded research is a priority for some society and commercial STM publishers, and lobbying efforts are directed not just to scholars but also to governing bodies in the United States and Europe. Sometimes their efforts backfire. PRISM, the Partnership for Research Integrity in Science and Medicine, was launched by the AAP/PSP. Its intent was to discredit a legislative proposal that would make all research funded by large federal agencies open access, like the NIH mandate but far larger. The PRISM web site was rolled out in August 2007.
Following the advice of a hard-line PR consultant, rhetoric on the site equated peer-review with traditional publishing, traditional publishing with the protection of scientific integrity, and open access with junk science. Reaction from researchers around the world was swift and blistering. The directors of MIT and Columbia University presses resigned from the AAP/PSP executive council in protest. Two weeks later, the worst of the hype on the web site was toned down, but calls for a disclaimer that not all members of AAP agreed with PRISM's position continued to be ignored. Ultimately, nine publishers, including Nature, Penn State, Oxford, Cambridge, University of Chicago, Rockefeller University Press, and Cold Spring Harbor Laboratory Press, disavowed PRISM. By the end of September, the AAP and PSP had removed all links to the site from their webpages. The PRISM site remains. There's a place to endorse the coalition's principles but no evidence that any publisher has done so.
Pricing the possibilities
When you push past the hype, most publishers don't object to open access as a concept so much as they object to it as a business model. Flipping to an OA business model means giving up subscription revenue and finding sustainable streams of revenue from authors, subsidies, or advertising. Roger Clarke's study on the operational costs of refereed journal publishing models (“The Cost Profiles of Alternative Approaches to Journal Publishing,” First Monday, 12/3/07) confirmed that the cost of publishing an open access e-journal is inherently less than the cost of publishing a subscription-based e-journal.
Commercial publishers have a hard time realizing the economies because they are locked into expensive practices that offset them, including higher quality branding and marketing, more aggressive customer management, and costly content protection systems. Taking those added costs into account, it takes a commercial publisher about $3400 to produce an article for an e-journal, while a nonprofit publisher could produce the equivalent article for about $730. The study suggests that it is easier for the nonprofit association to flip its business model to OA than it is for the large commercial publisher.
The numbers seem to support these findings. This is the first year any of the large STM publishers have offered a full OA journal—among others, Elsevier launched OncologySTAT and Springer, Neuroethics. By contrast, a large number of nonprofit society publishers already have established OA journals. A study by Peter Suber and Caroline Sutton reported in SPARC's Open Access Newsletter (11/2/07) found that 427 societies publish 496 fully OA peer-reviewed journals. Nineteen societies publish another 74 hybrid OA journals.
The most notable experiment in flipping both commercial and society publications to an OA business model is CERN's SCOAP3 project, in which all of the partners that support publishing in particle physics, including libraries, are being asked to redirect subscription monies into a common fund that will pay publishers for open access to particle physics research. The end goal is to make the literature of the discipline fully open to any researcher. As of mid-March, 50 percent of the needed funds had been pledged by libraries in 13 countries. The number of U.S. library participants was expected to grow quickly following a February meeting at University of California–Berkeley that was attended by some of the premier academic libraries in North America.
Making ends meet
While it may be relatively easy for small nonprofits to flip to OA, the complexity no doubt increases as the societies and the publications become larger and have greater potential to bring in revenue. The American Anthropological Association (AAA) is a case in point. Open access advocates in AAA have pushed for years to make its publications OA. The association's journals have been heavily subsidized by member dues and library subscriptions, however, making the prospect of changing business models unattractive to AAA leadership. Then last fall, without consulting the members, the executive board moved the society's 22 journals from the University of California Press to Wiley-Blackwell. The board hoped the change would bring the publishing program into the black and return a profit to the association. Some members felt AAA was turning its back on OA and despaired that higher prices would follow. Sure enough, in 2008 the cost of two flagship journals, American Anthropologist and American Ethnologist, increased 86 percent and 145 percent, respectively. On the other hand, price increases for the other 19 journals were moderate.
To its credit, AAA is now facilitating ongoing debate about what happens when the contract with Wiley-Blackwell ends in five years. In the February issue of Anthropology News, scholars exchanged views about the role of open access in the work of the association. Should the journal publishing program be seen as a commodity to be sold for a return, or is there a social value to the work of anthropology scholars that becomes more visible with OA? Is OA a priority or a value-add in the broader mission of AAA? This discussion is worth watching—it may be a bellwether for other societies caught in a similar conflict. Publishers may also be watching, as publishing agreements with societies are one of a dwindling number of methods by which publishers can acquire new content to sell.
Trying to quit
The open access movement suggests dramatic changes are coming to the journals marketplace, but if you ask the typical librarian, it still looks pretty much like a serials crisis. A few publishers price outrageously and get great chunks of the library's budget, leaving little money for smaller publishers and new publications. But every now and then, a big subscriber decides it just won't take it anymore, and the library world holds its breath. It happened last October when the Max Planck Society (MPS), a leading European research institute, announced that it was cancelling all 1200 or so of Springer's journals, saying that Springer's prices were more than twice what it considered to be justifiable. The standoff lasted until February, when Springer announced that an agreement had been reached.
Under the two-year contract, MPS regained access to all of Springer's journals, and Springer agreed to waive all author charges for Max Planck researchers who want to publish in one of Springer's Open Choice (hybrid) publications. Springer sees this deal as a way to gain further experience with an OA business model but also expects the agreement to increase submissions from the thousands of prestigious researchers affiliated with MPS. Rumors are that Max Planck was also pleased with the deal. For better or worse, that's the way these standoffs usually turn out.
The next big deal?
The largest publishers negotiate pricing for much of their content, and they are finding the resource-intensive process to be a drain on profitability. Some commercial publishers are talking about getting out of the negotiating business and are considering selling their journals as a single database with fixed pricing. No titles in, no titles out—unless the publisher chooses. Publishers are also monitoring the use of their content and are looking for ways to tie usage to price. It's easy to see the utility of these ideas from a publisher's perspective but difficult to see how they would play in the market given the high value librarians place on selecting their own content and the levels of dissatisfaction with already high prices.
Slow sales, stagnant market
According to Outsell, a market intelligence service, the top ten STM publishers pulled in 53 percent of the revenue in the $16.1 billion periodicals market in 2006. In the same time period, five of the six journal publishers in the top ten—Elsevier, Springer, ACS, Wiley, and Blackwell—showed growth only in the single digits, ranging from 0.5 percent to 7.6 percent. The slow growth reflects a fairly stagnant and saturated market.
Elsevier is the dominant player in the STM world with market share about three times that of its nearest competitor. Unhappy with profit growth (7.2 percent in 2006), Elsevier is making changes. Last year, the company initiated an ambitious plan to cut $2 million in costs for each of the next five years. Then in February 2008, Reed Elsevier CEO Crispin Davis announced the company will sell Reed Business Information, which publishes trade journals like Library Journal and Publishers Weekly, and purchase ChoicePoint, a large personal data company. Davis said these moves are part of a company strategy to get out of traditional advertising-based publishing, with its slowing sales growth, and into online information services with higher margins. You have to wonder to what degree Elsevier intends to extract itself from scholarly publishing and whether other for-profit publishers would follow Elsevier's lead.
What to expect in 2009
The marked changes brought on by the advance of open access has so far had little effect on the price of subscribed journals, the notable exception being some 3300 peer-reviewed journals listed in the Directory of Open Access Journals (DOAJ), all of which are free. Prices of subscription-based journals increased nine to ten percent in 2008, driven by an extremely weak dollar. Non-U.S. titles in the humanities and social sciences increased even more (11 percent), because publishers in these disciplines tend to price in native currencies, driving U.S. prices up when those currencies are converted to dollars. The sciences, on the other hand, are dominated by large European publishers that price in U.S. dollars, reducing the volatility of prices and keeping price increases in foreign scientific journals under nine percent. Given the continuing slide of the dollar, expect increases in 2009 to approach ten percent overall.
