Open Access May Involve Hidden Costs for Journal Publishers, as Conflicts over Subscription Agreements Indicate

Elsevier’s hard line in negotiations with German and Swedish universities over journal access and publishing contracts can follow from the limited financial attractiveness of Gold Open Access in the long term.

A Blog Article by Pablo Markin.

Since late July, 2018, Elsevier had cut off German university libraries that have failed to reach a satisfactory agreement with this publisher to its journal databases. Whereas a conglomerate of German scientific organizations and academic institutions has been unsuccessfully discussing with Elsevier the terms of its futures subscription contract since 2016, this situation could stem from several factors that give this publisher cold feet. These German universities and institutions have sought to replace individually negotiated journal subscription deals with Elsevier with a single, association-wide contract, in an effort to put pressure on their negotiations. However, from the publisher’s and libraries’ perspective, discretely concluded subscription deals could afford different profitability and cost levels for the parties involved, while providing organization-specific subscription solutions.

This breakdown in Elsevier’s negotiations in Germany also apparently follows from the intention of German universities and institutes to drive its journal subscription costs downward. Yet the argument that high and rising journal access prices are unsustainable does not necessarily take into account the cost structure of Elsevier by the dint of which it may have subsidized economically under-performing academic journals it publishes with the revenues that its broad subscription deals have afforded it to distribute in the first place. The transition to Gold Open Access, effectively demanded by the German negotiation partners, is very likely to put an end to the distance from performance pressures that the subscription model provides to scholarly journals. Based on the Gold Open Access model, the budgets of the corresponding journals can be expected to primarily derive from article processing charges, which vary widely from one academic field to another, if they lack third-party, governmental or non-profit funding.

In other words, for journal publishers the adoption of the Gold Open Access model may entail a significant organizational reorganization, especially in relation to how revenues are generated, costs are covered and editorial teams are run. While German universities cast Open Access as a model for attaining financially sustainable subscription costs, for Elsevier the de facto transition to Open Access taking place in Germany, and Sweden, leads to short-term and long-term revenue losses. This further deepens the gulf between the negotiation positions of Elsevier and its German counterparts.

The game-theoretical stalemate between this publisher and German university libraries can be perpetuated by apparently zero-sum games that transitions to Open Access may set into motion, as the distribution of costs and benefits is perceived to be excessively in favor of one negotiating side only, especially when Gold Open Access is deployed. However, in game-theoretical terms, mutually beneficial arrangements, i.e., plus-sum games, are also possible, such as when hybrid or Green Open Access models are implemented, which include both subscription and Open Access options, e.g., in the framework of institutional subscriptions.

Additionally, as German libraries cut off from Elsevier databases take recourse to interlibrary loans for article access, recent court decisions, such as in Munich, pave the way for blocking illegal downloading sites for scholarly papers, which increases the likelihood of a compromise between Elsevier and its German negotiation partners.

By Pablo Markin

Featured Image Credits: At the library, Haidhausen, Munich, Bavaria, Germany, January 7, 2013 | © Courtesy of Foto Schlachthof/Flickr.

This post is based on an article that originally appeared in OpenScience, 10/08/2018, https://openscience.com/open-access-may-involve-hidden-costs-for-journal-publishers-as-conflicts-over-subscription-agreements-indicate/.