A. Market Forces 1. Market Position
Wiley is a significant publisher with strengths in Science, Technical and Medical (STM) publishing, Professional/Trade publishing, and Higher Education publishing. Doing business since 1807, Wiley has evolved significantly, in order to persevere and flourish from the presidency of Jefferson to the present day. One of Wiley’s biggest challenges is to continue to evolve as the marketplace evolves. Transforming its high-value journal content to an online format was an important recent challenge, and today’s environment presents new challenges, such as tight library budgets, debates about new pricing models, and e-archiving. For a publisher (as for any company or organization), it is important to understand one’s market position and one’s strengths and weaknesses. Certain strategic questions then present themselves. Given our market position, are we positioned where we want to be, and if not, where do we want to be, and how can we get there from here? Given our strengths and weaknesses, are we capable to do the things we need to do to get from here to there, and if not, how can we add the missing capabilities, or should we alter our direction?
2. Living Among Market Forces
There are certain strong market forces at work today in STM journal publishing, including:
† Variable government funding of research, with some areas receiving healthy funding (for example, NIH research and development and basic research funding increased by 100% from 1996 to 2002; seeAAAS, 2003, Trends in Federal R&D, FY 1990 – 2004, and Trends in Basic Research, FY 1976 – 2004).
† Weaker funding of libraries (for example, ARL libraries’ expenditures increased by 33% from 1996 to 2002; seeARL, 2003, Expenditure Trends in All ARL Libraries, 1986 –2002, Table 4).
† The formation of library buying consortia, e.g., OhioLINK, the Northeast Research Libraries (NERL), National Electronic Site Licensing Initiative (NESLI).
† Increasing development of new technology tools in aid of research, including the online journals that are now available at the scientists’
desktop.
† The desire by end users for more and more online functionality, requiring ongoing investments to meet the requirements.
† New ideas about business models, such as Open Access, and participation by philanthropic institutions; for example, George Soros (http://www.
soros.org/openaccess), Gordon and Betty Moore Foundation (http://
www.moore.org/prgmareas_science.asp), Paul Allen (http://www.
brainatlas.org/).
These forces create an environment with the following characteristics:
† Everyone in the value chain of scientific information is challenged to add value in new ways.
† Scientists enjoy the enhancement of research technology tools, and increasing integration of software and content.
† The parties who are trying to serve scientists—publishers, librarians, professional societies—struggle to provide all of the services that scientists demand, in an economic environment of scant increased capital.
Societies, publishers, and librarians share the common cause of facilitating scholarship.
B. Adding Value
In this environment, scientific publishers ask themselves, What value do we add? How can we add more value? What do we do that is indispensable, and no one can do better? Basically, publishers organize and fund the process by which scientific communities prepare and share their research results, and work together with scientists and librarians to innovate and implement to improve the scholarly communication process. This means:
† At conferences, editorial board meetings, campus and lab visits, and focus groups, speak with scientists and librarians about what they need in publications, resources, and tools.
† Based on these discussions, identify needed innovations, invest, and take risks in new initiatives to meet the expressed needs of scientists.
† Design, develop, produce, market, sell, distribute, and warehouse new and existing products.
† Recruit, gather, and pay scientists as editors-in-chief and editorial boards of journals and book series.
† Provide organization and funding for scientists as they conduct the peer review of scientific research articles.
† Provide online tools for authors and editors to prepare, submit, and review articles.
† Prepare manuscripts for print and online publication, and for long-term archiving: copyedit, XML tag, layout, proof, print and bind, present online, store in content management systems, distribute content to partners such as abstracting and indexing services and local hosts.
† Provide information about journals to libraries and authors.
† Distribute scientific content to libraries and individuals. With libraries, establish licenses for online access for their patrons.
† Pay the costs for all of the above.
Today, in addition to the publishers who have been providing these services for decades or centuries, there are new entrants such as the Scholarly Publishing and Academic Resources Coalition (SPARC; seehttp://www.arl.
org/sparc) and the Public Library of Science (PLoS; http://www.
publiclibraryofscience.org) who have also entered the field. Over time, the long-lived publishers have developed unique competencies:
Sustained focus. To survive, publishers must respond to new ideas that arise, and initiate new ideas themselves. Their survival depends on it. In response to new opportunities, publishers are continuously chasing the goal of “cheaper, faster, better.” Over the years, there have been a number of initiatives that have arisen that intended to revolutionize scientific publishing. Some of these initiatives have come from the library community, but libraries have sometimes struggled to enlist the support of their university’s faculty, who to some degree are already invested in the status quo, and do not necessarily see the library’s problems as their own. Sometimes these initiatives have faded away as their proponents have moved on to other interests, or as the initiative has become side- tracked in disputes about standards (e.g., metadata), or superseded as the initiative morphs into something different (e.g., Scholar’s Portal becomes institutional repositories and meta-searching). Publishers, while perhaps
not the most nimble, have “outlasted the competition” by dint of their sustained focus.
Long-term development of new publishing models. Partly as a result of their sustained focus, and working closely with library, scientist, and technology partners, publishers have managed to develop new approaches that have evolved into robust models. Even before the Internet, the potential of electronic publishing was evident. Starting in the 1980s, publishers began to develop the Standard Generalized Markup Language (SGML). After a lengthy start-up period, SGML gained momentum when the US govern- ment’s Department of Defense began to require that technical documen- tation be SGML-tagged. STM journal publishers used SGML to develop the MAJOUR (Modular Application for Journals) header Document Type Definition (DTD) in the late 1980s. In the early 1990s, publishers collaborated with libraries in four important electronic publishing experi- ments—the Chemical Online Retrieval Experiment (CORE; seeEntlichet al., 1997), The University Licensing Program (TULIP; seehttp://www.elsevier.
com/wps/find/librariansinfo.librarians/tulip), Pricing Electronic Access to Knowledge (PEAK; see http://www.lib.umich.edu/retired/peak), and Red Sage (seeLucier and Brantley, 1995)—that shed light on how journals could be presented electronically in libraries. Around that time, Adobe Systems developed the Portable Document Format (PDF), which publishers quickly recognized as a breakthrough in the presentation of content online. SGML- tagged article headers (bibliographic information plus abstract and keywords) plus full-text PDF became a powerful package of electronic content. By the mid-1990s, with the advent of the World Wide Web, publishers and librarians developed innovative licensing models, including the “consortium”
model, led by OhioLINK and Academic Press (University of Cincinnati, 1996 –1997), which brought increased access to more content for more users.
By the late 1990s, SGML had evolved into XML (Extensible Markup Language), offering better interoperability. And in the late 1990s, journal publishers created CrossRef to link the articles among the different publishers via reference links, in a “distributed aggregation” model, to use a term first applied to electronic publishing by Pieter Bolman of Academic Press while CrossRef was being created (private communication, 1998; Pentz, 2001).
By this time, online journal publishing had settled into a few standard presentations and selling models.
Self-sustaining economic model. The subscription model has served scientific communication for centuries. In the online world, subscriptions and licenses continue to provide good value for libraries and users, and return on investment for publishers. There is a public debate about whether journal subscriptions are too expensive. Since the advent of online publishing, publishers have invested in increased functionality and volume of content,
providing more value for money. Publishers continue to enhance the value of their offerings, especially by investing in technology, and also by continuing to improve their services, to continue to play a critical role in the scientific communication enterprise.
C. Profit and Loss, and “The Financials”
Publishers want to publish the work of the best scientists, in the areas where the most important and interesting science is being done, and where there is strong funding; for example, medicine tends to be such an area.
In today’s economic environment, in the “hard” sciences where STM publishes, it is difficult to start up a new journal (absent a few million dollars of philanthropic start-up money, or a guaranteed subscriber base). This is a pity, because science continues “twigging,” and research needs outlets.
In previous years, the standard business model for a new journal was to lose money in the first 2 years, begin to make money in the third year, and have a cumulative profit by the fifth year. (In real life, it often took 7 years instead of 5.)
Today, in order to bring new content into journal publishing, it is more likely that a publisher will leverage an existing brand-name journal, and extend its reach into a new area, rather than starting up a small new journal that focuses only on that area.
The costs per published journal article have been estimated at around
$4000. The Open Society Institute (2003, p. 16, Fig. B) gives $3750 per article for “editorial processing” which excludes print manufacturing; and King and Tenopir (1998, p. 9, Table 3) give $5000. Of course, journals’
per-page costs differ based on variables such as print run, color vs. black and white, mathematics vs. straight text, page dimensions, and editorial office costs.
Revenue centers for publishers are:
† subscriptions/licenses: libraries, individuals;
† a share of member dues (for a society-owned journal);
† advertising;
† offprints and reprints of individual articles;
† sponsored supplements;
† color charges and page charges to authors (for some journals);
† pay-per-view for online articles;
† copyright fees for document delivery;
† license fees for digitized backfiles (old volumes of journals).
Of these revenue centers, subscriptions/licenses account for about 85%
of revenue for most STM journals, though for medical journals with strong
advertising the percentage of revenue comprised by subscriptions and licenses is more like 55%, with advertising at 35% (Credit Suisse First Boston, 2004, p. 27, Fig. 37).
Ultimately, decisions about what to publish are determined by the scientists themselves, in the persons of journal editors-in-chief, editorial boards, and peer reviewers. Scientific publishing is a communications loop within the community of scientists, who act as authors, editors, reviewers, and users, with publishers providing infrastructure, enabling technologies, capital, organization, and domain expertise in publishing.
Publishers look to librarians as an extremely important voice of the scientist/user. Working together with librarians, publishers know better how to reach the end users. In Section V we discuss specific areas where publishers and librarians can work together especially closely to improve the services that we jointly provide to scientific researchers.