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Elsevier and the 25.2 Billion Dollar A Year Academic Publishing Business

29 December 2015

From Medium:

Twenty years ago . . . Forbes predicted academic publisher Elsevier’s relevancy and life in the digital age to be short lived. In an article entitled “The internet’s first victim,” journalist John Hayes highlights the technological imperative coming toward the academic publisher’s profit margin with the growing internet culture and said, “Cost-cutting librarians and computer-literate professors are bypassing academic journals — bad news for Elsevier.” After publication of the article, investors seemed to heed Hayes’s rationale for Elsevier’s impeding demise. Elsevier stock fell 7% in two days to $26 a share.

As the smoke settles twenty years later, one of the clear winners on this longitudinal timeline of innovation is the very firm that investors, journalists, and forecasters wrote off early as a casualty to digital evolution: Elsevier. Perhaps to the chagrin of many academics, the publisher has actually not been bruised nor battered. In fact, the publisher’s health is stronger than ever. As of 2015, the academic publishing market that Elsevier leads has an annual revenue of $25.2 billion. According to its 2013 financials Elsevier had a higher percentage of profit than Apple, Inc.

. . . .

 Brian Nosek, a professor at the University of Virginia and director of the Center for Open Science, says, “Academic publishing is the perfect business model to make a lot of money. You have the producer and consumer as the same person: the researcher. And the researcher has no idea how much anything costs.” Nosek finds this whole system is designed to maximize the amount of profit. “I, as the researcher, produce the scholarship and I want it to have the biggest impact possible and so what I care about is the prestige of the journal and how many people read it. Once it is finally accepted, since it is so hard to get acceptances, I am so delighted that I will sign anything — send me a form and I will sign it. I have no idea I have signed over my copyright or what implications that has — nor do I care, because it has no impact on me. The reward is the publication.”

Nosek further explains why researchers are ever supportive by explaining the dedicated loyal customer base mantra, “What do you mean libraries are canceling subscriptions to this? I need this. Are you trying to undermine my research?”

In addition to a steadfast dedication by researchers, the academic publishing market, in its own right, is streamlined, aggressive, and significantly capitalistic. The publishing market is also more diverse than just the face of Elsevier. Johan Rooryck, a professor at Universiteit Leiden, says, “Although Elsevier is the publisher that everybody likes to hate, if you look at Taylor & Francis, Wiley, or Springer they all have the same kind of practices.”

Heather Morrison, a professor in the School of Information Studies at the University of Ottawa, unpacks the business model behind academic publisher Springer and says, “If you look at who owns Springer, these are private equity firms, and they have changed owners about five times in the last decade. Springer was owned by the investment group Candover and Cinven who describe themselves as ‘Europe’s largest buy-out firm.’ These are companies who buy companies to decrease the cost and increase the profits and sell them again in two years. This is to whom we scholars are voluntarily handing our work. Are you going to trust them? This is not the public library of science. This is not your average author voluntarily contributing to the commons. These are people who are in business to make the most profit.”

Should a consumer heed Morrison’s rationale and want to look deeper into academic publishers cost structure for themselves one is met with a unique situation: the pricing lists for journals do not exist. “It’s because they negotiate individually with each institution and they often have non-disclosure agreements with those institutions so they can’t bargain with knowing what others paid,” says Martin Eve, founder of the Open Library of the Humanities.

In addition to a general lack of pricing indexes, the conversation around the value of a publication is further complicated by long-term career worth. David Sundahl, a senior research fellow at the Clayton Christensen Institute for Disruptive Innovation, says, “We actually understand how money passed through to artists who wrote music and authors who wrote books — but it is not clear how the value of a publication in a top tier journal will impact someone’s career. Unlike songs or books where the royalty structure is defined, writing a journal article is not clear and is dependent not on the people who consume the information but rather deans and tenure committees.”

Link to the rest at Medium

Non-Fiction, Non-US

7 Comments to “Elsevier and the 25.2 Billion Dollar A Year Academic Publishing Business”

  1. The big institutions and their libraries are the ones which should complain.

    When I was a physicist at Princeton’s Plasma Physics Lab, the Lab paid all those publishing costs, and had an art department which ensured the graphs, etc., met the journal’s picky submission requirements.

    They were also the big customers.

    And they were probably using the articles to vet potential employees in the sciences.

    They are the people who should change the system.

  2. Alicia, you are amazing.

    And I think Elsevier will soon be disrupted. It will only take three young people with creds and quickness of mind and quicksilver servers. It will happen soon, I think.

    I wonder what E’s stock is riding at now vs Apple which has, we hear, billions socked away, that shareholders often make noise about wanted payouts. Not sure how it all works for them.

  3. Linguists are liberating themselves, slowly but surely. The long-established, centrally important journal Lingua, published by Elsevier, has been abandoned by the field in favor of the Open Access parallel journal Glossa. The people at the Language Log are gleefully documenting the demise of what they’re now calling Zombie Lingua: http://languagelog.ldc.upenn.edu/nll/?p=22162

    Academic publishers deserve to die painful deaths. They strangle academic discourse, refusing to publish all manner of things deemed too marginal or too finicky. For example, in my field, annotated transcriptions of narratives in indigenous languages of the Americas are basic data, useful to linguists and anthropologists in a myriad of ways, but journals stopped publishing them way back in the, er, 50s (I think.) Now researchers (and speakers) can publish their own collections, but you’d think publishers who pay nothing for material and claim to be central to research would feel an obligation.
    Die, Zombie, die!

    • “Die, Zombie, die!”

      From your lips to the Zombie Resistance Forces.

      In seriousness, as Uber has disrupted, as Airb&B has torn the hotel market to shreds, the day will come Anna. And I think, soon. And you are right, the I dont even know what to call it, the viciousness of being vetted by the journals is a time well gone, and ought have been gone eons ago, so those who are bright and new, can shine over the old flat bloodless… you were right, zombies.Maybe even sub sub zombies.

  4. As long as tenure track requires publication in an “accredited journal” this system will not die. The universities need to change their publication requirements of professors first.

    • I’m with Josh on this. I’ve also found that ‘research’ for academia often consists of writing a certain number of words, referencing lots of published treatises in journals instead of actually finding original data and using that to prove or disprove an argument. Hence degree education of a higher sort is often a simple regurgitation of semi-digested articles which are regurgitations themselves of earlier confabulations… and these are all ‘genuine facts’ or ‘real’ information simply because three people of unknown skill ‘peer reviewed’ the articles and they were published in one of these expensive journals.

    • I’m reminded of a major Australian university that a couple of years ago thinned its staff out on the basis of how much each had published.

      Working in the retail side of academic publishing, I can’t see much of a drop in the profits of these publishers in the near future, particularly the ebook aggregators. Chasing the majority of university libraries that are now e-preferred, the aggregators seem to have a sky’s the limit view to pricing. I’ve seen a book available in print for around $100 be priced via an e-aggregator at over $1,000, or worse. You have to wonder just how much of that extra money filters back to the authors.

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