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3
Publication Business Models and Revenue
Scholarly publishing in any medium requires substantial resources be-
yond content creation costs. Publishers are providers of value-added prod-
ucts and services. They perform crucial functions by producing documents
in different media, performing editorial and design work, marketing the
material, and connecting readers to writers, and so forth. All of those func-
tions involve costs. Even a not-for-profit publisher has to at least recover
costs and generate a reserve.
It is useful, therefore, to examine sources and types of revenue, ways of
raising revenue, and different business models, particularly in a world where
digital publishing is becoming much more the norm. The business models
are related to what information is being published, for what audience, and
how it will be accessed. In a digital world we no longer need to have a single
standard mode (i.e., the journal). We can think about presenting informa-
tion in lots of different ways and repackaging it and distributing it in differ-
ent combinations.
What is the role for government in this process? Much of what we are
talking about--scientific, technical, and medical information and scholarly
communication includes information that benefits the general public either
directly or indirectly, far beyond the community of scientists and scholars
who are using it. There is a public interest in the dissemination of knowl-
edge, in addition to its creation.
Of course, the overriding question for this symposium is what impact
the digital publishing world is going to have on science itself, that is, on the
20
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BUSINESS MODELS AND REVENUE 21
scientific enterprise. For instance, how are different business and access
models going to affect the quality and productivity of science, collabora-
tion at a distance, access for developing countries, the professional review
and career process, peer review, and other aspects of scientific research?
The discussion that follows looks at the major business models from
several stakeholder perspectives. It begins with an overview of trends in the
commercial STM journal publishing industry, followed by a perspective from
the library community, which serves as the intermediary between STM pub-
lishers and the academic user community. Two contrasting publishing para-
digms are presented next: the traditional "reader-pays" model, as implemented
by John Wiley & Sons, Inc. and the newer "open-access," "author-pays"
model of the Public Library of Science. The section concludes with a review
of issues raised in the discussion with the expert audience.
TRENDS IN COMMERCIAL (FOR-PROFIT) STM JOURNAL
PUBLISHING1
Consolidation of Publishers
The for-profit STM publishing market is "mature," which means that
there is only modest growth in revenue, and it is difficult for new players to
enter that market. In a time of immense change, publishers are experiment-
ing with new and different ways of working in this marketplace. We should
expect, for example, to see consolidation among publishers continue, even
as the customers (mostly libraries) continue to launch antitrust actions
against buyouts or mergers between significant STM players. That said, it
is highly unlikely that any scientific discipline will have more than two or
three information providers in the years ahead.
Moreover, the form that consolidation will take may change. In addi-
tion to the already familiar phenomenon of big STM companies buying up
smaller ones, we should look for smaller companies to link together in an
attempt to provide levels of service and functionality similar to those of-
fered by the big companies.
1
The information in this section is based on the remarks of Joseph Esposito, president
and chief executive officer of SRI Consulting.
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22 ELECTRONIC PUBLISHING
Bundling
A mature market should be expected to intensify downward pressure
on journal prices. This is already true in academic research institutions,
where the open-access movement is being created in part to put pricing
pressures on STM publishers, both for-profit and not-for-profit. Publishers
will likely counter such pressures by targeting the market share of other
publishers, rather than looking for significant increases in library budgets.
For example, Reed Elsevier is now offering libraries access to previously
unsubscribed journals, not by charging for each journal separately, but
simply by insisting on an increase in total expenditures over the prior year.
This practice has been referred to as supersizing, or the big deal. In other
contexts, it is called bundling or tying. Bundling will have the effect of
greatly increasing the number of Reed publications available through par-
ticular libraries, at the expense of having less well positioned publishers lose
those customers entirely.
Downstream Value Migration
We also should expect commercial publishers to seek so-called down-
stream value migration and to target competitors that for various reasons
are thought to be vulnerable. These "competitors" may include, for ex-
ample, former partners such as secondary publishers or subscription agen-
cies. By moving downstream, more publishers will attempt to
disintermediate2 the wholesalers and reap the wholesalers' marginal rev-
enue. Disintermediation strategies that do not provide significant new value
to end users are probably ineffective, but that does not mean publishers will
not try such strategies.
Targeting Vulnerable Competitors
For-profit publishers are likely to target the not-for-profits more ag-
gressively in the future. The reason is that the not-for-profits may be per-
2"Disintermediation" is the process by which new Internet-based products and services
replace products or services that existed in the pre-Internet era, particularly ones that serve as
intermediaries between the provider of a product or service and the end user.
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BUSINESS MODELS AND REVENUE 23
ceived to be slower to respond to technological capabilities and to be less
competitive, though they often have substantial goodwill in the market-
place. There are many prospective targets among the small university presses
and learned societies.
Creation of Meta-Content
Metadata are often defined as "content about content," and they can
be exploited or created as bibliographies, indexes, and, most important of
all, through search engines. Publishers are keenly aware of open-access pub-
lications and are looking for ways to make money from them. Open-access
publications are, by definition, available for any individual organization to
use without permission or fee. Thus, one way for publishers to use open
access is to create search engines for open-access content. Even more power-
ful is to integrate open-access content with proprietary content for search
purposes. In other words, open-access publications provide publishers with
lower costs for content development while enabling for-fee services. From
an economic point of view, copyright transfer to publishers is unnecessary
for supporting publishing profits.
The Shift to Web Services
The most significant economic response to open access is likely to be
in the creation of Web services, in the form of dynamic substitutes for the
publication of fixed content in hard copy. In a Web service, a publisher will
provide online software that manipulates or processes data that are up-
loaded to it by a user. The user creates the content and then pays the service
provider for the online processing. Copyright is irrelevant for models like
this, even as the economic potential is very great.
Diversification of Customer Base
If the academic channel is mature (i.e., lacks the potential to grow
rapidly, if at all) publishers will seek new sales channels. The most likely
one, because of its size and creditworthiness, is sales to businesses such as
engineering, chemical, or pharmaceutical companies. Thus, publishers'
capital investment may shift from pure research publications toward ap-
plied research and engineering.
In 5-10 years, open-access publications will coexist with proprietary
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24 ELECTRONIC PUBLISHING
ones, and we will witness ingenious publishing strategies designed to ex-
tract economic gain even in the absence of a proprietary distribution model.
THE LIBRARY PERSPECTIVE3
The scholarly journal has existed for more than three centuries. The
journal provides a trusted place to document discoveries, disseminate ideas,
and codify prestige. This three-century tradition will not easily change.
Responses of Libraries to Recent Cost and Marketing Trends
Research libraries are the intermediaries between two types of econo-
mies. They buy content in a market economy and make it available in the
nonprofit, academic sector. Thus, libraries are often caught in the clash
between the market and the gift economies. In this position, the libraries
have witnessed decades of journal price increases, with average annual in-
creases for the past 5 years being around 8 or 9 percent. It is a very inelastic
market, because as the prices increase, libraries are not able easily to with-
draw or cancel the costliest journal subscriptions. Data over the past 15
years show that journal prices have increased by 215 percent, yet libraries
canceled only about 5.1 percent of their subscriptions. Despite the appar-
ent lack of elasticity in this market, the ability of libraries to continue to
afford all research content, in the face of escalating STM journal prices, is
certainly cause for concern.
STM journal price increases and inelasticity have increased in the past
2 years as a result of two developments. The first is that the publisher
strategy of the so-called big deal--the multiyear, all-titles packages sold by
many publishers to libraries and consortia--has begun to unravel. Some
research libraries intend to withdraw from journal package arrangements,
because of budget reductions and the low or non-use of a significant pro-
portion of titles in the package. Libraries are beginning to push for more
finely tuned licensing models, whereby they can select only the content
that their users read.
Additionally, big deals frequently are priced in a way that is hard to
undo or to understand. For example, the University of Minnesota library
3The information in this section is based on the remarks of Wendy Lougee, director of
the University of Minnesota Library.
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BUSINESS MODELS AND REVENUE 25
worked with Elsevier Science to back out of its big deal and found that,
because of current electronic and print pricing structures established by
this publisher, reducing the subscription list from 750 titles to 650 titles
and moving to electronic-only would result in a higher per-title cost.
A second sobering event has been the demise of some of the industry
intermediaries such as the subscription agents. One major serial vendor
declared bankruptcy, leaving unpaid publisher debts reported to be some
$73 million--money that had already been collected from library custom-
ers and who ran the risk of not receiving their paid subscriptions for 2003.
In the end, most publishers agreed to "grace" the libraries' subscriptions,
but at a huge loss to their organizations.
The likelihood of increased revenues for libraries in the near term (par-
ticularly increases that match inflation in journal prices) is low. A recent
informal survey conducted within the Association of Research Libraries
suggested that nearly half of respondents expected cuts in some areas and
the prospects were high for further budget reductions in the coming fiscal
year. Library budgets, a major source of revenue for publishers, are obvi-
ously stressed. The volatility in the publisher marketplace will probably
continue, as will the push from the library community for the more finely
grained models that allow them to make some choices.
Implications of Changes in Journal Format and Content
Early usage data indicate that much more use results from electronic
content, which is available to licensed users anytime and anywhere. Recent
studies of university users nationwide have revealed an overwhelming prefer-
ence for electronic format. In such surveys, nearly half of all faculty in most
disciplines reported they use online materials for the majority of their work.
Yet interestingly, despite that preference, other studies of perceptions
of convenience and ease of use show a dramatic gap in how the library
performs in delivering electronic content. Users cite evidence of their in-
ability to manage such content, to navigate it well, or to deal with the
myriad different distribution platforms and channels.
In addition, there is a subtle shift from our concept of publication as
product to the notion of publication as process.4 There are a number of
4See discussion in the chapter on "What Constitutes a Publication in the Digital Envi-
ronment?"
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26 ELECTRONIC PUBLISHING
examples where online discussions really have the form of being an actual
publication. For libraries, which are in the business of managing copy-
righted, fixed works, that presents a real challenge. Dynamic "publications"
pose a challenge, too, to the STM publishing sector in terms of pricing.
How should a publisher develop models that support publications that are
not fixed or well bounded?
The Changing Role and Influence of Libraries
A recent Morgan Stanley report5 suggests the potential for reduced
operating costs for libraries--no periodical check-in, no binding, no claim-
ing. However, the necessary infrastructure to support the investment in
electronic content, to federate it appropriately, to ensure its longevity, and
to archive it, requires greatly increased expenditures on the library side.
Any subscription savings will be needed to support additional electronic
infrastructure. It is critical to focus community attention on issues of infra-
structure, interoperability, and the kinds of protocols that will allow that
federation to happen.
Libraries have a role in seeding and supporting alternative, competitive
approaches to electronic publishing. Librarians understand content, its use,
and the users. There are many examples of libraries actively engaging with
new types of STM journal publishing. A growing number of institutional
libraries, such as Cornell and Michigan, are starting incubator and produc-
tion services to help small publishers move to electronic publishing. These
projects represent a move away from libraries' traditional role of providing
access to information toward facilitating production of information, and it
may help libraries reconceive the relative position they have long held in
the STM information sector.
THE COMMERCIAL SUBSCRIPTION-BASED MODEL6
One fairly typical example of a commercial STM publisher based on a
reader-pays model is John Wiley & Sons, Inc., which is a global, indepen-
5Morgan Stanley Industry Report. 2002. Scientific Publishing: Knowledge Is Power.
6This section is based on the remarks of panel participant Brian Crawford, vice presi-
dent and general manager, Life and Medical Sciences, John Wiley & Sons, Inc.
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BUSINESS MODELS AND REVENUE 27
dent publisher established in 1807. Wiley's three major areas of publishing
today include STM journals, higher education materials, and professional
and trade information. Theirs is a fairly diversified publishing portfolio,
with about $1 billion in annual revenues. Wiley publishes 400 STM jour-
nals online on its InterScience platform, which was established in 1997.
This resource now contains about 2 million pages of information.
Because Wiley uses a customer- or reader-pays model of delivering
STM journal content, the publisher places a great emphasis on sales staff
worldwide--staff that it did not use in the conventional print environ-
ment, where it was marketing via direct promotion to scientists and librar-
ies. As Wiley embarked upon the development of licenses for its electronic
journals, it did so very much in consultation with its major institutional
customers. This resulted in flexible sales options. The company did not
want to make an early commitment to one preferred option early in its
electronic publishing, so it provided a menu of print and online options.
Many not-for-profit organizations are still in the early stages of develop-
ing bundled journal licenses for their institutional customers, whereas for-
profit publishers have undertaken much more aggressive licensing in recent
years, as noted above. Wiley currently uses what it calls "Basic Access" and
"Enhanced Access" licenses. The basic access license offers title-by-title ac-
cess, with some concurrent user restrictions. The basic access option is most
often suitable for the smaller institution or department. The enhanced access
license does not require that an institution subscribe to all Wiley titles that
are available electronically. The institution can choose, but it is establishing a
license for a larger body of work, with no concurrent user restrictions and
with additional benefits such as negotiated price caps. Wileys' business model
also emphasizes direct relationships with its customers.
Finally, Wiley constantly invests in new features and enhancements for
its electronic publications. Some of the most recent ones include content
alerts to apprise its audience of what is being published, delivery of content
to mobile edition platforms, and publishing online in advance of print
publication.
Reasons That Wiley Will Not Use the Author-Pays,
Open-Access Model
There are several reasons why Wiley has not elected to use the author-
pays, open-access route. Most of Wiley's professional society partners are
quite wary of any economic system that tends to favor author payment for
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28 ELECTRONIC PUBLISHING
publication. Given that the bedrock of scientific communication is peer-
reviewed journal literature, Wiley's view is that any system that charges the
author or a sponsor of the author in order for that author to be published is
going to favor the author's desire to become published.
What has evolved in scientific communication, for the most part, is a
system where the reader pays, or an agent for the reader is paying, because
that naturally introduces an objective filter for the validity and the value of
the work. One should not assess the value of information on the basis of
the cost to produce it. Instead, the value of the information is its value as a
tool, as a productivity multiplier in society. Wiley, therefore, has very much
supported a customer-pays model for the business, because the company
believes it ultimately enhances the value of scientific information for those
who should value it most.
Nevertheless, Wiley does offer free access, from the time of publica-
tion, to developing countries. For its biomedical journals, it provides free
or inexpensive access through the Health InterNetwork Access to Research
Initiative (HINARI) of the World Health Organization (WHO). HINARI
puts content into the hands of investigators in parts of the world who truly
cannot afford such information.
THE OPEN-ACCESS, AUTHOR-PAYS MODEL7
The Public Library of Science (PLoS) is a new scientific publisher with
an open-access business model, which has also been called a midwife model.
Reconceptualizing the STM Publishing Business Model on the
Internet
Before the Internet, there was no choice but to charge users of scien-
tific publications, because the most efficient way of making them available
was by distribution in the print format. In the print environment, every
potential user represented an incremental expense for the publisher, and
any business model that did not take that into account was doomed to
7
This section is based on the remarks of panel participant Patrick Brown, professor of
biochemistry at Stanford University and a cofounder of the Public Library of Science (PLoS).
For additional information about the PLoS, see http://www.plos.org/index.html.
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BUSINESS MODELS AND REVENUE 29
economic failure. The print system thus had the consequence of limiting
distribution only to individuals and institutions that were willing and able
to pay, and this system was accepted as a necessary evil. With the advent of
the Internet, however, that model is no longer necessary.
The traditional business model has also had another indirect conse-
quence that has been subtle but equally unfortunate: It is based on selling
research articles. Some scientific publishers can assert that the content of
their journals is valuable property that they own, control, and sell for a
profit. This is a barrier to open scientific communication that now needs to
be reconsidered.
The worldwide spread of the Internet now leads to fundamental and
positive change in the economics of scientific publication, as well as the
technical means of distribution. The change makes possible the realization
of Jeffersons' ideal of the infinite, free dissemination of scientific ideas and
discoveries. What had been an impossible ideal in the pre-Internet era--to
make the published information an open public resource--is now possible,
because the cost to the publisher no longer scales with the number of copies
produced or with the number of potential readers of a publication. Accord-
ingly, users are not restricted to a business model that charges per access or
per copy. In fact, we see that a business model that restricts the distribution
and use of the published work is working against the interest of science and
society. The economic model of print has become unnecessary, anachronis-
tic, and inefficient and now stands in the way of the ideal of open and free
dissemination. If we do not need to charge readers for access, then we
should not charge for it.
"Open Access" Defined
An open-access publication is one that meets two conditions. The first
is that the copyright holder (either the author or the publisher, if the copy-
right has been transferred to the publisher) grants to the public a free,
irrevocable, perpetual right of access to, and a license to copy, distribute,
perform, and display the work, and to make and distribute derivative works
in any medium for any purpose.
The second condition is providing readers with open access to the
work. Authors or publishers achieve open access by making a complete
version of the article and all supplemental materials available in some suit-
able standard electronic format, deposited immediately upon publication
in at least one internationally recognized, independent online repository
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30 ELECTRONIC PUBLISHING
that is committed to open access. One well-known example of such an
open access archive is PubMed Central, maintained by the National Library
of Medicine.
Advantages of the Open-Access Approach for Science
The practical advantages of true open access are already very familiar
to many researchers in the life sciences through two longstanding, amaz-
ingly successful open-access experiments--GenBank and the Protein Data
Bank. The success of the genome project, which is generally considered to
be one of the great scientific achievements of recent times, is due in no
small part to the fact that the world's entire library of published DNA
sequences has been an open-access public resource for the past 20 years. If
the sequences could be obtained only in the way that traditionally pub-
lished work can be obtained, that is, one article at a time under conditions
set by the publisher, there would be no genome project. The great value of
genome sequences would be enormously diminished.
More significant is the fact that open access is available for every new
sequence, which can then be compared to every other sequence that has
ever been published. The fact that the entire body of sequences can be
downloaded, manipulated by anyone, and used as a raw material for a cre-
ative work has led thousands of individual investigators to take up the chal-
lenge of developing new data-mining tools. It is such tools and the new
databases that incorporate sequences, enriched by linking them to other
information, that have made the genome project the success that it is today.
By adapting the genome model of open access to the publication of scien-
tific literature, we could see a similar flowering of new, investigator-initi-
ated research and creative, value-adding work.
Open Access Supported by the Author-Pays Business Model
Unlike the subscription-based model, the PLoS plans to charge the
costs of publication to authors and their sponsors. From the standpoint of
business logic, this is by far the simplest and most natural model. It is
natural, because the cost of online publication is scaled to the number of
articles, not the number of readers. It also makes sense from the standpoint
of institutions that pay for research. Their mission is to promote the pro-
duction and dissemination of useful knowledge. From that perspective,
publication is inseparable from the research that they fund. The PLoS ini-
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BUSINESS MODELS AND REVENUE 31
tially plans to charge about $1,500 per published article, with no charge to
authors who cannot afford to pay.
Research sponsors should welcome this model, because for a fraction
of 1 percent of the cost of the research itself, the results can be made avail-
able to all readers, not just to the fortunate few who are at the lead research
institutions (i.e., institutions that can afford to pay for site licenses).
In the short term, of course, open access will generate an incremental
expense, but in the long term, once the scientific community has made the
transition to open-access publication, there will actually be savings to the
major research sponsors because, after all, they are ultimately the ones who
pay for library and even individual subscriptions. The Howard Hughes
Medical Institute (HHMI) is one of the largest funders of scientific re-
search in the life sciences, and it has already endorsed this model. The
HHMI has agreed to provide budget supplements to its investigators, spe-
cifically to cover author charges for open-access publications.
The PLoS will also produce printed editions of its journals for sale to
institutions or individual subscribers at a price intended to recover only the
cost of printing and distribution, everything downstream of producing the
published digital document. The print subscription is estimated to cost ap-
proximately $160 a year. There will be no cross-subsidies between the open-
access online publication and the break-even print publication operation.
ISSUES RAISED IN THE DISCUSSION
Relative Merits of the User-Pays and Author-Pays Models
A number of points and counterpoints were made in favor of both
types of models, in addition to those raised during the speaker presenta-
tions, summarized above. The following arguments were presented in favor
of the user-pays model and against the open-access model, in which the
author or the institution funding the research pays.
Devaluing the overall utility of the information. There is an inherent bias in a
system where the author pays, which ultimately would devalue that infor-
mation in terms of its overall utility as a productivity multiplier. There are
two reasons for this: The first is that a less selective filter would be imposed.
And second, is that an economic system where the author pays is naturally
going to favor the author. That means that any entity wanting to make
decisions about that work needs to impose yet another filter, at some cost,
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32 ELECTRONIC PUBLISHING
in order to determine how that work stacks up against others. Most scien-
tific publishers would say that selectivity is probably not exercised all that
often by authors, because they seek to get their work out. It is necessary to
optimize two variables. One variable is the dissemination, and the other is
the filtering. The author-pays model moves the filter boundary, whereas
publishers also have an interest in disseminating the work as broadly as
possible. It is a matter of getting the balance right between those two con-
siderations.
The difficulty of convincing research funders to subsidize authors' page charges.
According to statistics presented by Donald King of University of Pitts-
burgh, roughly one-third of STM journal articles are funded by the federal
agencies, about a third of them are funded exclusively within the universi-
ties, and the rest by industry. How will the funders of these authors be
convinced that they need to pay an additional page-charge fee of $1,500
above the money that they are already paying the authors to prepare those
articles? It is necessary to have different kinds of arguments for those three
different constituencies. In doing that, it also may be necessary to go fur-
ther in trying to understand the funding priorities and budget profiles in
each sector.
Organizational missions and market forces as determining factors for business
models. One aspect about the discussion of business models that has not
been adequately discussed is the question of the mission of the organization
that is doing the publishing. That does have a significant effect on the
business model that is selected. For example, various societies make use of
the page charges as a way of supporting their member subscriptions, keep-
ing the member rates low, so that they can provide more benefits to their
members. A commercial publisher or a university press cannot really charge
page charges, unless it is a journal they are publishing on behalf of a society,
because that is not viewed as appropriate. It would be seen as gouging.
Color page charges might be acceptable, because color printing constitutes
an additional direct cost for the publisher.
One should not look at the customer-pays model, as opposed to the
open-access model that has been proposed as an author-supported model,
in absolute terms. Indeed, many professional societies have had a hybrid
model, where they have benefited from subscriptions at the same time that
they have used author page charges and other subventions to help support
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BUSINESS MODELS AND REVENUE 33
their publishing programs and to keep the costs to the customer down.
That kind of hybrid model has been determined over time by market forces.
The subvention of publishing costs by the payment of page charges
and subvention for carrying color reproduction charges are examples of
how some organizations have found an effective balance. They have done
this even in a user-pays model, implementing certain charges that are passed
on to the author, where the needs of the author are seen as unique, and
something that the author would want to pay in order to benefit from a
service. Most organizations, however, do not make that a criterion for a
decision of acceptance or rejection; it is merely a matter of presentation of
the work.
The factor of author selectivity favors a reader-pays model. Finally, the value
and the future of any publication are going to be determined mainly by
what authors want to do, where authors want to publish. For example, the
New England Journal of Medicine is open to all authors; 4,000 scientific
articles are submitted to the journal each year, with no charge for submis-
sions and no page charges if the paper is accepted. The role of a biomedical
or scientific journal is to be critical and selective. That is in part why au-
thors want to publish there. If authors or their sponsors have to pay, is this
selectivity going to be compromised? How is the PLoS going to exercise the
functions of peer review and of being selective? Is that part of the PLoS
model?
Arguments in favor of the author-pays, open-access model and against
the reader-pays model included the following:
No correlation between a reader-pays model and the maintenance of high-qual-
ity standards. There have been a number of studies that have looked at the
relationship between the price and measures of quality of scientific jour-
nals--citations, their assessment by peers in the field, and so forth. They
have found, overall, a dramatic negative correlation between price and qual-
ity. The notion that users' paying for journals somehow upholds high-qual-
ity standards is not supported by the data.
Every scientist, at least in the life sciences, knows that most of the
journals that are regarded as third-tier journals of last resort, but that pub-
lish 99 percent of the articles, have no author charges but very high sub-
scription costs, whereas the premier journals typically wind up charging
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34 ELECTRONIC PUBLISHING
authors in color charges and page charges something on the order of $1,000
or more.
The authors' overriding interest to be read and to enhance their professional
reputation benefits from open access. The factor that serves to maintain the
quality of the work that authors submit for publication is not that they
think it is extremely difficult to get a paper published. One can always find
a mediocre journal that will accept just about anything. Rather, it is that
the authors know that sooner or later their peers are going to read what
they write, and their reputation depends on it being good. That is ulti-
mately what determines their career advancement, their status in the field,
and so forth.
The point that publishers would favor the author by charging the au-
thor is absolutely right. The public good that is produced by scientific re-
search is very special. In contrast with other public goods, the value of
scientific public goods increases with use, and it is specifically in the author's
interest. It is very much a part of the motivation of the author of a scientific
paper to have access to that paper as widespread as possible, more and more
used, thereby enhancing the value to the community, as well as the interests
of the author.
The motivations and interest of all sectors in scientific research should be sup-
portive of an author-pays, open-access approach. The interests are similar for
government, academia, and industry, namely, the motivation to support
the research and to encourage the authors to publish it. The motivation to
pay an increment of less than 1 percent of the total research cost to make it
much more valuable to the people who are supposed to be served by it is
presumably the same for all three sectors that sponsor research.
Author selectivity not dependent on a reader-pays model. The journals most
attractive to authors tend to be the ones in which they have the least chance
of having their papers accepted. The PLoS certainly has factored that into
its development strategy. It intends to be very selective from the beginning;
it is selective not just on the basis of whether the article is good enough to
be published somewhere else, but in selecting papers that are likely to be of
interest to a very wide audience, precisely because the PLoS considers that
this is going to be important in terms of developing the journal identity
and as a magnet for submissions.
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Page charges not a disincentive to authors. If we go to a model where the
institutions are covering page charges as an essential part of research, it will
make it even less of a disincentive to authors. Established publications may
not need to worry about converting to a system based on author page
charges, and the resulting open access would be better for the community
they are supposed to be serving.
The Effect of Different Publishing Business Models on the Long-
Term Preservation of Digital Journals
The focus of publishers in electronic publishing is mainly on the actual
production of the work and its dissemination on the Web. They generally
have not addressed the important issues that deal with long-term preserva-
tion, including the integrity of the information and its migration to new
platforms. Reed Elsevier has begun an innovative project with the Royal
Library in the Netherlands, where they are looking at how to address those
kinds of long-term preservation problems. The solutions will be costly, and
the costs will need to be shared between publishers and libraries, ideally
with support from governments and other institutions.
The PLoS definition of open access includes the immediate deposition
of the publication with some organization that is committed to long-term
access. There is no certainty, however, that organizations will actually fol-
low through on this commitment. One of the advantages of print publica-
tion is that with enough copies produced, very long-term preservation is
more or less guaranteed, which is not always the case with electronic publi-
cations.
The PLoS nonetheless does have plans for providing archival stability
for its information. What is important, however, is not only that some-
where there exists a permanently preserved copy of the information, but
that it is permanently openly available to everyone. Of course, one would
be hard put to find a more trusted and trustworthy archival repository than
the National Library of Medicine, which has agreed to archive PLoS publi-
cations, but the fact that the information is also going to be freely and
widely distributed, and that it will exist in many institutional servers, pro-
vides another measure of reassurance. In the view of some observers, it
would be a mistake for institutional repositories to agree to take on the job
of archiving information without requiring the publishers to grant unre-
stricted open-access rights.
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One example of a professional society's approach to the archiving prob-
lem is the American Physical Society (APS), which has put all of its content
going back to 1893 online. It is all linked and searchable, and PDFs are also
available. Current content is added as it becomes available. There will be
costs in changing the format of this in the future. The society also recog-
nizes the concerns of libraries and of the entire scientific community that
this historical record might be lost.
What would happen if the APS were to go under? There is a full mirror
site of the entire archive that is already accessible and tried at Cornell Univer-
sity, which is where The Physical Review originated back in 1893. The jour-
nals are also deposited at the Library of Congress. If the society is terminated,
it has an agreement with the library that these holdings will be put in the
public domain, freely available to anyone. This is the societys' primary effort
for ensuring continued availability of its archived publications.
There appears to be a clear distinction between the perspective of the
professional society as a publisher and the private commercial publisher.
The professional society has a very strong vested interested in archiving,
whereas the private publisher really has none.
Issues in Transitioning to the Open-Access Model
The APS also has an open-access model for one of its journals that it
started 5 years ago--Physical Review Special Topics, Accelerators and Beams.
It is a small journal, but it is available completely without access barriers. It
is not, in fact, free because it does cost something to publish it. The costs
are recovered through the sponsorship of 10 large particle accelerator labo-
ratories around the world. It is also cosponsored by the European Physical
Society's Interdisciplinary Group on Accelerators. At this point it is only a
limited experiment, however, because the APS has other expenses that it
must recover, and it has to see whether these things work or not. The society
cannot afford to bet its entire future on the open-access approach, because
it still needs to recover its costs.
The APS did propose that the society would like to put everything online
without access barriers. It could do this right now if every organization that
now subscribes to its journals would make those subscriptions sponsorships,
providing enough to recover its costs. Then it could be opened to everyone
else. The risk would be that institutions might be tempted to decide that
since all journals are available, they no longer have to pay anymore. The
libraries would love that, but then the publisher would go under.
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The question thus arises as to whether there are any paths or way sta-
tions between full open access and the current subscription-based model.
One possible approach might be for a publisher to give the author an op-
tion for a surcharge. The author could pay extra to have immediate open
access to his or her article, whereas all the other articles of authors who did
not pay the surcharge would be free after 6 months. The amount of the
surcharge, however, must not be so high as to be a disincentive. Nonethe-
less, there is clearly difficulty making that transition. The PLoS had to get a
large grant from the Moore Foundation to buffer the financial risk for its
experiment. Without the grant, the PLoS could not have been started.
Publishers also could ask the institutional subscribers that now provide
most of the revenues--mostly academic institutions that probably accept
the philosophy that journals serve the public interest--to continue to pay
their subscription fees at the current rate for some interval of years to be
specified, during which time the publisher would make the transition to
open access. With such a multiyear commitment of support, the publisher
would have a stable revenue source that is not put at risk by making that
transition. It can try to make the transition, at the end of which time it can
determine whether it looks like it is going to be a self-sustaining model.
One would hope that the current subscribing institutions would not take
the low road and try to undermine the process by free riding and saving
themselves a little money. They should see that it is in their own best inter-
est in the long run to encourage the open-access approach.
Such an arrangement is not unlike what Ohio Link does, but that
initiative came up with some extra money that enabled the organization to
open its journals to the institutions in the entire state of Ohio. That is the
kind of catalyst that may be needed: a bit of extra money.
It might be best to view this approach as transitional, because ulti-
mately the sensible thing would be for the research sponsors to cover the
publication costs as an essential part of their mission of promoting and
disseminating research. In the short term, it is probably necessary to cata-
lyze the process.
The problem with the temporary approach, however, is what happens
if it does not work? It is very hard to get people to resubscribe. Once a
library has given up the subscription and used the money somewhere else,
resubscribing becomes viewed as a new acquisition.
To counter this problem, the sponsoring institutions could be pro-
vided an incentive to maintain support. For example, if a university pro-
vides $5,000, or whatever the amount may be, then everyone from that
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university has open-access publishing rights in the journal. This would
make it a competitive advantage for the university to offer this. If you treat
it as kind of a credit pool that could be drawn on by authors from the
subscribing institution, then even in the open-access model, they are get-
ting some special benefits beyond what the nonpaying institutions are get-
ting. It becomes an added incentive.
Advertising Revenues in Electronic Publishing
Nearly 50 percent of one publisher's total costs are attributable to edi-
torial, peer-review, and production processes, items other than printing,
paper, and distribution. Although many STM journal publishers have no
advertising revenues, advertising for some print journals underwrites more
than 50 percent of the total cost of operation. For such journals, the elec-
tronic-only model, assuming it had less advertising, might save on some
costs, but would actually result in a major lost source of revenue.
For journals with broad member or individual circulation, most adver-
tisers still seek print as their means of reaching that audience. They are not
yet ready to move away from print advertising to online-only in scholarly
publications, although this may not be the case with other consumer-ori-
ented publications. It would be very risky to go to an online-only strategy
for STM publications if the publisher currently relies on such advertising
revenue.
Sponsor-Supported Open-Access Model
Many researchers like the open-access model because it is the sponsor
of the research who shares with the author the interest in having the prod-
uct disseminated as widely as possible.
For example, when the National Institutes of Health (NIH) supports
most of its research, it is because it will be published and made into a public
good. To fulfill the goals of supporting the research at all, the sponsor gen-
erally carries a responsibility to see that the material gets published. For this
reason, the HHMI model that supports the PLoS is a very good one, and
many scientists who publish research would like to see that kind of ap-
proach propagate. The question that was raised earlier in this regard still
remains, however: Is there a way to persuade the less well funded science
agencies to take on the responsibility to pay extra for publication costs?
This would be in contrast to the present model, which puts the author
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payment responsibility into a grant in which the author has discretion
whether to spend that money for publication, or to spend it for support of
another graduate student or some other research cost.
One can make a strong argument that the publication costs amount to
less than 1 percent of the research costs (in biomedical research, at least). If
that is true more broadly across the different disciplines, if you had to take
a 1 percent cut from other aspects of the budget to do it, it is a plausible
argument that the return on that investment would be extremely high, as
opposed to the 1 percent cut from other areas, because all the grantees and
all the research that an agency is funding would be providing much freer
access to a more extensive body of information. The purpose of funding of
research is not just to serve the immediate community of the grantees, it is
the wider scientific community and the general public that should be much
better served by the information.
At the same time, according to Patrick Brown, when this issue has
been raised with respect to NIH funding, many NIH grantees have ob-
jected if this were to come at the expense of a 1 percent cut in research
funding. They argue that there is not enough research funding to go around
already. So clearly it is a controversial proposal.
Representative terms from entire chapter:
electronic publishing
