Buying Academic Journals – much more complex than you might think!

Universities occupy an interesting position in the procurement ecosystem. In some countries, they are largely private, whilst in others they sit firmly in the public sector. In the UK, their classification is becoming increasingly unclear, as they obtain more and more funding from business and students directly.

But independent of that, they all spend their money on a very wide spread of goods and services, from nuclear reactors to cleaning services, lecture theatre equipment to utilities. And one of their particular major spend areas is academic journals, those exciting publications with titles such as the "International Journal Of Fuzzy Systems" , or "Rangifer - Research, Management and Husbandry of Reindeer and other Northern Ungulates".

Now there is a brewing controversy about the amount that major publishers of these journals charge universities for their subscriptions. A piece of research work in the US has exposed big price differences, and also describes the way the publishers use confidentiality agreements to stop buyers comparing notes and prices. But the researchers exploited the fact that the US Freedom of Information Act trumps secrecy agreements in public contracts in most US states. As the Guardian reported:

“The value for money that universities are getting from commercial publishers is generally considerably less than the value for money they are getting from non-profit publishers," said Paul Courant, an author on the study and professor of economics and information at the University of Michigan. "The non-profits provide on average much better value for money, especially to the big universities, that much is clear," he added.

From a market dynamics point of view, it is a fascinating case study. In one sense, you might think that universities would be in a powerful position here. They are the major buyers of these products, after all, in a fairly limited potential market of buyers. But equally, the publishers have created a whole range of de facto monopolies in different academic areas. If you are an academic in a certain sector, there are probably one or two publications that get the best research papers, and therefore other academics must read to keep up with developments in their field. Hence the ability for publishers to charge what seems like a lot of money, and to obtain apparently above inflation price hikes year after year, for the top journals.

The market is further complicated by agents operating in the market – that brings benefits but also adds a further dimension that must be considered by procurement people in this area. As Andy Davies, Director of the London Universities Purchasing Consortia, told us;

The benefit of our agents is that they can obtain almost any journal for their clients, even the most specialist foreign titles ...  Acting through an agent offers discounts across the full range and library professionals can manage their libraries much more effectively using the software packages they provide. The sector has tried to make some in-roads by negotiating directly with the bigger publishers with some success.  But the agents’ business models use discounts they negotiate with the bigger publishers to help subsidise the smaller, specialist titles.  One theory is that if we negotiate our own discounts with the bigger publishers, our agents cannot discount the specialist titles and so some of the smaller institutions will be forced to cut some titles as budgets tighten.  This could threaten the very existence of some journals on, say, 13th century Chinese literature”.

It does feel like the sort of market that the digital revolution and the growth of new business models should have changed substantially. OK, so papers have to be peer reviewed before publication in reputable journals, which brings a cost no doubt, but it is surprising that some lower cost options for disseminating research material haven't supplanted the traditional commercial models over the last few years. But back to Andy Davies to explain one of the issues.

"Academics are understandably keen to get their papers published in the most prestigious titles, which fuels demand.  Then publishers charge universities large subscriptions when universities are, of course, providing all the content, even when the research has been funded by the public purse.  Some academics have tried to set up ‘open access’ websites where papers can be shared freely for all, but until academics pay less attention to the prestige of the best international titles (and universities are ranked by the number of citations), there seems to be no end in sight to the market challenges".

It never ceases to amaze me how interesting seemingly mundane markets can be, and the range of procurement challenges our colleagues face – and here’s another beauty to add to that list of tricky spend categories!

First Voice

  1. Dr Gordy:

    Thanks Pete, a fascinating area. Two interesting points I think you have missed. The authors of academic papers do not receive payment (yet they are also consumers and sales – pointing students to recommended reading)., Peer reviewers do not receive payment, yet they are also consumers. Journals can’t function without authors and peers reviewers. There are actually a very small number of publishers although many journals. Power in turn should be with authors and reviewers, yet it appears no university or consortium has been able to harness the power of access to its authors or peer reviewers to negotiate a deal with publishers. Also worth considering the consumption of the NHS as a producer and consumer of academic journals.

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