Sunday, October 23, 2011

High profits for commercial publishers - or jobs for academics? Let's #occupyscholcomm

Here are some snippets from some work-in-progress that may be helpful to those working to help academics understand the need to transform scholarly communication, from an economic perspective.
The elevator pitch version, for the academic / university administrator who is having a hard time letting go of those high-profit publishers' products:
Elevator pitch
Okay, Elsevier* does have some pretty snazzy journals** and useful services, and of course they need to make a profit because that's what the company is all about. So, next time we renew our Elsevier contract, how much of YOUR salary and benefits should we redirect to Elsevier profits - all, or just some?
* Replace Elsevier as appropriate with another high-profit commercial or not-for-profit that acts like a corporation.
** Replace journals as appropriate with books, bibliographies, etc., etc.

High profits for commercial publishers – or jobs for academics?
For-profit scholarly publishers are enjoying these gifts of ours [journal articles and peer-reviewing services freely given away]. Commercial publishers are involved in publishing about half of the world’s scholarly peer-reviewed journals. The profits, at least for the largest commercial publishers, are enormous and out of touch with the reality of academia. I am sure that we are all too familiar with the financial realities of academia today. If you look at the website of the American Association of University Professors, you will see prominently posted a list of “Financial Crisis FAQs”, which state that the current challenging financial situation is being used to justify a number of measures that impact on academics, including “hiring and salary freezes, furloughs, salary cuts, layoffs, nonrenewals, reduction and elimination of academic programs and colleges, revision of curricula, changes in academic policy, elimination of tenure, substantial changes in workload, and more”.  In 2010, the UK announced that it would eliminate funding for humanities and social sciences teaching altogether, leaving the entire burden of education in these areas on the shoulders of students. I study at Simon Fraser University in Canada, where a couple of years ago we axed the Canadian Studies department.
The for-profit scholarly publishing sector is not at all sharing in this misfortune. The largest companies – Reed Elsevier, Springer, Wiley, informa.plc (also known as Taylor & Francis), all reported profits in the range of 30-40% in their latest financial statements. Wiley reported a 13% growth in profits over last year at this time, for a 42% profit level. To picture just how high this profit level is, compare this with what you are likely seeing in your personal investments. A bank’s interest on your savings account is probably a lot closer to  .0036% than to 36%, the profit rate that Elsevier recently posted. This is an inelastic market. It doesn’t matter if many of the people who are doing the largest share of the work – doing the research, writing up the results, doing the peer review – are losing some of their jobs and bits of their salaries, or if the universities that are, by far, the major part of the customer base for these companies are facing extremely challenging financial times. These things don’t impact the bottom line, at all. Another way to express this is that for these for-profit companies, their CEOs and their shareholders – to whom we give our life’s work – it fundamentally does not matter whether we have work to live. 
American Association of University Professors. 2011. Financial Crisis FAQs. Retrieved October 5, 2011 from
Elsevier profits: Economist (2011). Of goats and headaches: One of the best media businesses is also one of the most resented. Retrieved September 25, 2011 from
Informa plc. (2011). Half year results for the six months ended 30 June 2011.  Retrieved  September 25, 2011 from
John Wiley & Sons. (2011). John Wiley & Sons reports first quarter fiscal year 2012 results. Retrieved from
Springer Science + Business Media. (2010). Annual report. Retrieved September 25, 2011 from
This is a snippet from an early draft of Chapter 2 of my thesis, tentatively called Freedom for scholarship in the internet age, combined with speaking notes from my talk, Information feudalism or knowledge for all, at the Association of Internet Researchers Conference, Seattle, October 2011. I am planning to release more detailed version(s) in the near future.
 This post is part of the Transitioning to open access series.
 For related posts and comments by others, check out the twitter hashtag #occupyscholcomm