Economics 404: Fixing What’s Broke | Peer to Peer Review

This year, several announcements and blog posts combined to focus my attention on a slightly different question. What problems can open access solve? The answer seems obvious; open access will solve the problem of highly restricted and limited access to scholarship. A somewhat different problem that OA can help solve is the problem of scholarship locked up in the hands of badly run businesses that have come to believe that their inefficient and ineffective ways of doing business must be preserved at all costs.
kevin-l-smith-newswireOne of the fun aspects of Open Access week each year is to look at the wide variety of events that are held around the world. There is so much passion, creativity, and knowledge brought to bear on the issues and achievements of open access (OA) that it truly is inspiring. These events, along with the news stories and press releases that are timed for Open Access week, also provide fodder for reflection on many issues. How far have we come? (A very long way.) What remains to be done? (Lots!) There is a great retrospective of the first decade of the open access movement by Heather Joseph in this article in PLoS Biology. This year, several announcements and blog posts combined to focus my attention on a slightly different question. What problems can OA solve? The answer seems obvious: open access will solve the problem of highly restricted and limited access to scholarship. One of the greatest achievements of the OA movement is to have largely won this debate about access. The times are past when publishers argued that the access problem was illusory; now they are tripping over themselves, by and large, to get out front and trumpet their commitment to improved access, as long as it increases their revenues. And therein lies the problem I want to focus on here; a somewhat different problem that OA can solve. A variety of items over the past couple of weeks have reminded me that the economics of traditional publishing is a mess; it is a deeply inefficient business that has been protected, largely owing to the copyright monopoly, from the ordinary competition that usually forces businesses to get smarter and operate better. So one of the problems that OA can help solve is one of scholarship locked up in the hands of badly run businesses that have come to believe that their inefficient and ineffective ways of doing business must be preserved at all costs. The best example of this attitude that needs to be resisted and refuted came recently in the reignited debate—a real “do as I say and not as I do” situation—about the business practices of Harvard Business Publications (HBP). As many librarians know, HBP has long restricted use of articles that are available in the EBSCO databases, trying to make them hard to use as course materials in order to force the payment of additional fees. Apparently, some students and professors were still finding a way to use this material, for which they had paid as part of their EBSCO subscription, so this summer HBP imposed more restrictions, requiring that EBSCO disable persistent linking, printing, and downloads for selected articles. These functions can be turned back on, however, upon the payment of an additional licensing fee, which was quoted, for my institution, in the six figures. Obviously, this move generated a lot of complaint, including an article in the Financial Times by a business professor who suggested that HBP should be punished for this behavior. That article was followed by a defense of HBP’s new licensing fees by a professor and press official from Harvard. That defense is a remarkable piece of reasoning, which really amounts to a simple claim: “we need more money.” Specifically, the author complains that “we discovered that some institutions were using EBSCO access as a substitute for paying normal course material fees.” But of course, “normal” fees were being paid; the fee for EBSCO access itself is substantial, and, for all other publications, it is the fee that permits all forms of access for authorized users. HBP is demanding an additional fee (which many institutions have declined to pay). Why does HBP need this extra money? Apparently, the only answer is that it is not very good at running its own business. HBP seems unable to live within its means, or to manage on the same revenues that other publishers can and do survive on, so it wants to charge institutions more for reduced services. The issue is why libraries and their parent institutions should bear the costs of these inefficiencies. One of the ironies is that these ever more convoluted methods of restricting access themselves surely increase costs for HBP. Like many other publishers (think HarperCollins and ebooks), HBP seems determined to invest a good deal of money into making the digital experience of its products as inconvenient, or more inconvenient, than it was in the print era. This is in addition to maintaining bloated staffs that are often committed to doing jobs that simply do not need to be done in the digital age. In the digital age, we have the opportunity to stop paying for inefficient practices that are rooted in attachment to print. Instead, libraries have an increasing opportunity to move our money away from supporting these traditional publication practices and toward experiments that support scholarship. In recent weeks, I have seen several proposals—some already made public, like Knowledge Unlatched, and some still being formed—that will offer better return for library collection dollars. The defense of HBP makes the fairly inane point that “high-quality information…comes at a cost.” Of course there is a cost, but as the ones who pay those costs, we are entitled to ask if they are reasonable, or if they have been inflated way beyond the normal amount required to produce the product plus an acceptable profit. In the publishing industry, we can find plenty of evidence of the latter. Breaking this cycle will not be easy. Libraries need to stand up to this kind of demand and decide what they can do without. Those decisions are inevitable, as we can see from the stories of the courageous librarian at SUNY Potsdam who has rejected package “deals” from both the American Chemical Society and Sage because the new pricing models would leave her without control over her own budget. But we can do more to take control. We can start refusing these ridiculous demands, in order to use those funds to support more sensible models of business that are transparent and that offer better value (including open access) for the money. In short, we can insist, in a digital age with many new opportunities for experimentation, on real competition. It is no longer content we should be paying for but services associated with content. And as we move our budgets toward such services, we must demand transparency and competition. In a post on the Scholarly Kitchen blog, publishing consultant Joseph Esposito talks about what a “web-scale university press” would look like. Esposito begins to imagine this world of services sold in association with free content. But he still seems tied to the standard models of business for this reimagined university press. Consider this remark:
Although this idea of a Web-scale press has an open access dimension, it is not OA for the usual reasons we hear about in the journals world—that is, because there is a great deal of demand for texts, but no budget to pay for them. University press books have the opposite problem, in that the demand for many monographs is simply insufficient to underwrite the publishing process.
The question he does not ask is whether the publishing process, as traditionally defined, really should be underwritten. One of the fundamental prerequisites for a web-scale publishing operation, it seems to me, is a radical reassessment of the entire process, seeking cost savings. That may happen in some cases, but we, the customers for academic work, certainly do not know about it and never see it reflected in the prices we pay. It would be a great shame if that ever-more-costly black box were just moved to the web as is. At the end of his post, Esposito lays out the strategy for a web-scale publishing operation in five steps. Steps one thorough four are all excellent plans. But his step five is to “supplement the revenue stream with institutional support,” a strategy he justifies by saying that the revenue generated by a book, averaging $15,000–$30,000, “may not be enough to cover the allocable overhead.” Here is where we need to look very closely as publishing moves online and decline to support operations that are not run more efficiently. The web-scale press simply cannot do business as usual! To Esposito’s five steps, I would add two more that seem necessary to me if we are going to fix the broken economics of publishing as we create web-scale publishing operations, whether those operations reside with university presses, societies, libraries, or some partnership. First, we need to rethink the traditional copyright assignment in scholarly works, so that creators have much more say in how their works are disseminated. Second, and closely related, we need to encourage competition among publishing venues, so that there is an incentive to be as efficient as possible and that both creators and users gain the benefits in improved services that competition can bring.
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