1. Pricing Journals in a Time of
Uncertainty – Exploring An Open
Access Alternative
Heather Joseph
Chief Operating Officer, BioOne
21 Dupont Circle NW St 800
Washington, DC 2003
+1 202 296 2296
Heather@arl.org
www.bioone.org
2. Less Access to Scholarly Research
n Large percentage of pressure driving publishers to
experiment with Open Access stems from results of
current pricing policies in the marketplace.
n Scientific journal prices have risen an average of
8.5% per year since 1986, while library budgets have
stayed flat.
n ARL libraries spend three times more money on
journals compared to what they spent in1986. Yet,
that money buys them 5% fewer titles.
n During this time period, the volume of research
published has increased significantly.
3. Contributing Factors
n Along with steadily decreasing library purchasing
power, other contributing trends have emerged:
n Consortia Purchasing: Good for libraries - lowers
overall cost and broadens journal access. Good for larger
publishers with critical mass; However, generally leaves
smaller publishers out of the deal.
n Bundled Packages: Larger publishers can sell bundled
content to maintain/expand market share; Smaller
publishers can not. Downside: ever-growing percent of
library budgets tied up in package purchases, threatening
continuation of support for small publishers.
4. Drivers Leading to
Consideration of Open Access
n Given these market conditions, many publishers are
at least considering alternatives. Drivers include:
n Are we maximizing our access?
n Can a move to Open Access stem or reverse negative
trends in flat or declining subscriptions?
Submissions?
n Will a move to Open Access significantly boost my
journal’s impact factor?
n What if a competitor moves to an Open Access
model?
n How can I compete with a $0 subscription price?
5. Considering a Move to Open
Access
n What are the primary factors that you should
consider?
n How do you begin to do scenario planning?
n Are their any templates/roadmaps/tools that
can help you?
6. Risk Assessment
n Source: Crow and Goldstein, OSI Guide to Business Planning For Converting A Subscription-Based
Journal To Open Access, Third Ediation, February 2004
n Evaluation of a move towards an Open Access model should
take into account three indicators, which differ journal to
journal:
7. Publication/Author Fees
n With Open Access movement is still in its infancy,
most widely known model to support it is to replace
subscription charges with a publication charges.
n How does a publisher determine an appropriate level
for these charges for your publication?
8. Article Fee Calculation Method
n In setting these fees, publishers must take into
account the following factors:
n All pre-press processing costs for which submissions will
incur a charge
n The number of submissions expected to be received.
n Will they cover all submissions received? Or just
accepted?
n The extent to which a publisher wants these charges to
offset actual expenses - completely cover the cost of
processing? Partially defray costs?
n Acceptance author fees in the journal’s field.
10. Beyond Author Fees
n A publisher might consider looking beyond a single
source of revenue to try and combine multiple
components to build a sustainable operation. There
are myriad potential sources to draw on, including:
n Author submission/publication charges (as just discussed)
n Article processing fees
n Re-print/Off-print sales
n Advertising
n Sponsorships
n Convenience-format licenses or distributor format fee
11. Beyond Author Fees (cont’d)
n Journal publication in additional supplementary formats
n Value-added fee-base services
n Contextual E-commerce
n Community Marketplace
n Dues Surcharge
n Foundation Grants
n Institutional Grants and Subsidies
n Government Grants
n Gifts and Fundraising
n Voluntary Contributors
n In-kind Contributions
12. Article Fee Calculation Method
n Market environment is changing quickly - don’t be
too quick to dismiss potential source.
n Make projections based on objective analyses of
market factors and potential.
n Prepare three sets of revenue projections—worst
case, mid case, and best case—and create three total
scenarios/pro-forma financials for each.
n Even small percentages of revenue (3-5%) from 4-5
of sources can quickly add up to 12-25% of your
revenue - that publication fees don’t need to cover.
13. Transition from Subscription
Model
n Some journals moving away from subscription
income are using a hybrid model designed to make a
planned transition over time.
n Journal offers an Open Access option it authors, and
lowers its subscription price over time as the
proportion of authors willing to pay the publication
fee increases.
n The theory is that journal gains new revenue to
support a transition at a rate approximately
commensurate with the acceptance of publication
charges by the journal’s author community.
15. Transition from Subscription
Model
n A)Year: Start with current year and project through at
least ten years.
n B) Subscription Price: Projected price based on the
subscription income necessary to offset any shortfall in
covering publication costs after income from publication
charges (and other income, if any).
n C) Paid Subscription Base: This is an estimate of the
number of paid subscribers relative to price and
transition to Open Access.
n D) Articles per Volume (Year): This encompasses
EITHER: number of articles published each year OR
16. Transition from Subscription
Model
number of submissions, depending on fees charged only on
published articles or on all submissions.
n E) Cost to Produce Journal: The projected annual cost of
journal publication that needs to be recovered.
n F) Percent of Authors Paying Charge
n G) Percent of Waived Charges: Percentage of authors
expected to pay publication charges in each year,
relative to those authors who will not.
n H) Computed Per-article Publication Cost: Estimated
cost to produce the journal divided by the number of
articles per volume (year).
17. Transition from Subscription
Model
n I) Actual Author Publication Charge: This incorporates a
surcharge to allow for the difference between paid and
waived publication charges.
n J) Publication Charge Income: Calculate the paid
publication charges—articles per volume multiplied by
the percent of authors paying. Multiplying that by the
actual amount of the author publication charge arrives at
publication charge income.
n K) Subscription Income: Multiply subscription price by
the number in the paid subscription base.
18. Transition from Subscription
Model
n L) Other Income if any: Input the estimated amounts of
other income (advertising, sponsorships, etc.)
n M) Total Income: This is the sum of J + K + L.
n N) Surplus or –Deficit: This is the “bottom line” for each
forecasted year. Deducting total cost to produce the
journal from total income yields the estimated surplus or
–deficit. A deficit is equivalent to the amount of
financial risk or shortfall the organization will face as it
transitions to Open Access.
n O) Cumulative Surplus or –Deficit: A spreadsheet
calculation of the cumulative amount.
19. Framework for Informed
Decisions
n While business models that can support Open Access
journals are still relatively new, and need testing to
determine sustainability, some good tools do exist to
help publishers evaluate their potential.
n A $0 subscription-based pricing model may not be
for everyone, but chances are, it will affect your
publishing program in some way.
n Objectively analyzing potential net effect is always a
prudent business strategy.
20. Resources
n Guide to Business Planning for Converting a Subscription-based Journal to Open
Access, (Edition 3), R. Crow and H. Goldstein (www.arl.org/sparc/resources)
n Model Business Plan: A Supplemental Guide for Open Access Journal
Developers & Publishers (Edition 1), R. Crow and H. Goldstein, SPARC
Consulting Group - - (www.arl.org/sparc/resources)
n “Scholarly Associations and the Economic Viability of Open Access Publishing,”
John Wallinsky, Journal of Digital Information. Vol. 4, No.2 (April 9, 2003).
n History of the Immediate Free Web Access (IFWA) initiative,
http://csssrvr.entnem.ufl.edu/~walker/epub/esaepub.htm.
n Alternative Publishing Initiatives Resources for alternative scholarly publishing
initiatives from the Association of Learned and Professional Society Publishers
(ALPSP) http://www.alpsp.org/htp_altpubs.htm
n OSI/ALPSP Roundtable Meeting: Converting an Existing Journal to Open Access
Notes from the September 13, 2002 meeting http://www.alpsp.org/notes131102.pdf
