Depth-First: The Journal Deadpool: Failing Business Models and Sick Markets in Scientific Publishing?

The Journal Deadpool: Failing Business Models and Sick Markets in Scientific Publishing?

Rich Apodaca — Fri, 27 Jul 2007 07:44:00 +0000

Several articles in the past few years have alluded to the ongoing cost squeeze faced by librarians maintaining scientific journal collections. Consistently we're told by those doing the buying that subscription costs have gotten way out of control. Sadly, there's only one correct response: kill subscriptions to those journals that price themselves out of the marketplace.

For the most part, canceling journal subscriptions has been a private activity - news doesn't consistently travel beyond the confines of the institution doing it. But what if it did?

Try this thought experiment: you're a journal publisher who has had a number of canceled subscriptions in the last two years. You continue to receive a healthy number of manuscript submissions, yet your revenues have been falling to the point that you may not be able to cover your costs. Do you (a) lower subscription rates to more competitively price your product; (b) keep rates the same, hoping things will turn around; or (c) raise rates to maintain profitability?

There's an interesting hypothesis, variously alluded to, that says that journals increase their subscription rates to remain profitable in the face of declining demand. Classical economics says that declining demand should result in declining prices, but that assumes a healthy, efficiently-functioning marketplace. Scientific publishing today may not be among them.

Could declining subscription rates actually be a major cause of the "increasing costs" faced by scientific publishers and passed on to subscribers? It's a testable hypothesis if the right data have been collected.

To conduct such a study, one piece of information that may be helpful is a market-wide summary of journal subscription cancellations. Let's call it the "Journal Deadpool." Unfortunately, to my knowledge, no such data exist.

By way of the Chemical Information Sources Discussion List, Thurston Donart Miller pointed out that the Physics-Astronomy-Mathematics (PAM) Division of the Special Libraries Association has maintained a list of canceled subscriptions for the last ten years.

The PAM effort is a step in the right direction, but what if they took it further? By including data such as the date of cancellation, the last annual subscription fee, and whether an online subscription to the journal is available at the institution, a much clearer picture of the state of the scientific publishing market would emerge.

A highly-publicized, multi-institution "Journal Deadpool" would certainly give food for thought to scientists considering where to send their next manuscript. And it would strengthen the case of librarians who are caught in the middle.

One of the prerequisites for a healthy marketplace is free flow of information among both buyers and sellers. A Journal Deadpool may be just what the doctor ordered.

Image Credit: geographie

"The Journal Deadpool: Failing Business Models and Sick Markets in Scientific Publishing?" by Rich Apodaca

Fri, 03 Aug 2007 14:08:46 +0000

I also ran across something called the "plankton theory" that might apply here:

The Plankton Theory, like life itself, begins and ends in the ocean. Plankton, of course, are almost microscopic organisms that serve as food for higher life forms. Without plankton almost every fish and mammal in the sea could not survive, since most species depend upon other fish for their existence and plankton are the initial building blocks of the entire process. Logic would suggest, therefore, that in attempting to forecast the well being of the Great White Whale, Jaws, or even Jaws II, that one of the factors to consider would be the status and future outlook of the plankton. That, in one hundred words or less, is the Plankton Theory.

"The Journal Deadpool: Failing Business Models and Sick Markets in Scientific Publishing?" by Rich Apodaca

Wed, 01 Aug 2007 18:42:40 +0000

So by forcing 90% of libraries to cancel their subscriptions, the publisher makes a measly 2.2 % ($20) premium? ($900 they get by charging $90 minus $880 they get by lowering to $8)

That sounds kinda short-sighted to me. After all, journals rely heavily on network effects (to attract readers, citations, and authors) which disappear below a certain threshold of circulation. It sounds like the start of a death-spiral...

Still, your hypothesis may well explain what's happening in scientific publishing. Collecting the data to test the idea may even be feasible.

Regardless of why they're doing it, publishers appear to be choosing Option C (raise rates in the face of flagging demand) - which seems like a phenomenon that should interest someone in a position to explain it with hard data.

"The Journal Deadpool: Failing Business Models and Sick Markets in Scientific Publishing?" by Andrew Dalke

Mon, 30 Jul 2007 08:26:58 +0000

Classical economics says that declining demand should result in declining prices

Where does it say that? Only in homogenous markets, I think. But the journal market is segmented.

Consider the case of 100 libraries willing to spend $10 on a journal and 10 libraries willing to spend $100. If the journal costs $10 then the total income is 110*$10 = $1,100. That price optimizes income.

If interest declines so the 100 libraries are only willing to spend $8 while the 10 libraries are only willing to spend $90 then the optimal price is $90, giving an income of $900. Leaving it at $10 gives an income of $100 and lowering the price to $8 gives an income of $880.

Many software businesses handle nonhomogenous markets with nonhomogenous products, like "Lite", "Home", "Business" and "Enterprise" versions of a package. Journals can't easily do that. ("I want the "pharma" version of Nature, not the "liberal arts college" version."?) At best they can provide additional services for a fee, but so far those don't pay as well as the journals themselves.

Some (most?) libraries which can afford to subscribe to a large number of journals offer a photocopying service to those who can't, so there will remain some libraries which are willing to pay rather higher subscription rates than others.