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Electronic Publishing and the Economics of Information
Part IIImplications for Libraries
Carol Tenopir University of Tennessee, Knoxville
http://web.utk.edu/~tenopir/tenopir.html
Donald W. KingUniversity of Pittsburgh
What factors affect demand?
• Price
• Journal attributes
• Availability & relative cost of alternatives
• Combinations of distribution means and media are finding a niche
Average Annual Price Increase (%) in Scientific Journals
0.00%1.00%2.00%3.00%4.00%5.00%6.00%7.00%8.00%9.00%
10.00%
1960-1975 1967-1986 1972-1988 1975-1995 1991-1995 1995-1998
Time Periods Examined
Average Cost Per Title:Science Journals 1996-2000
0
200
400
600
800
1000
1200
1996 1997 1998 1999 2000
U.S.Non-U.S.
Why have journal prices spiraled upward?
• Size and Inflation – 56%
• Drop in personal subscriptions
• Addition of new, low-circulation journals – 17%
• McCabe thesis
• High profit / net revenue
To understand price one must understand publishing costs
• Five publishing functions:– Article processing (=$190,000)– Non-article processing (=$19,500)– Reproduction (=$101,000)– Distribution (=$80,500)– Support (=$168,500)– Total (=$559,500)
Average Cost per Subscription
$0$100$200$300$400$500$600$700$800$900
500 1,000 2,500 5,000 10,000
Number of Subscriptions
Average Number of Personal Subscriptions to Scholarly Journals
0
1
2
3
4
5
6
7
1977 1978-1983
1984 1985-1989
1990-1993
1994-1998
2000-2001
Years of Observation
Comparative Costs
0
100
200
300
400
500
600
0 10 20 30 40 50
Tot
al C
ost
($)
Individual Subscription
Library Use
Break-Even Point (36.5)
Number of Readings of the Journal
Cost of Subscribingvs. Library Use
117.6$1,000
59.4$500
30.3$250
18.7$150
12.9$100
Break-Even Point
(Readings)
Individual Price
($)
Individual Subscription Prices
<0.1$1,000
0.7$500
3.2$250
8.7$150
15.0$100
Proportion of Journals to which
Scientists can Economically Subscribe
Individual
Price
Subscribing vs. Separate Copies
56.5$1,000
30.4$500
17.3$250
12.1$150
9.5$100
Break-Even Point in Number of Readings
Institutional Price
Library Owning vs.Borrowing Article Copies
0
100
200
300
400
500
600
700
800
900
0 5 10 15 20 25 30
Number of Readings of the Journal
Tot
al C
ost
($) Break-Even Point
ILL/Document Delivery
InstitutionalSubscriptions
Library Subscription Prices
49.0$1,000
65.5$500
78.2$250
84.6$150
88.9$100
Proportion of Journals to which Libraries can Economically Subscribe
Institutional Price
Purchasing vs. Document Delivery
Document Delivery Fees
Journal Prices
$0 $5 $10 $20 $30
$100 17.4 11.8 8.9 6.0 4.5
$250 31.9 21.5 16.2 10.9 8.2
$500 55.9 37.8 28.5 19.1 14.4
$1,000 104.0 70.2 53.0 35.6 26.8
Electronic Journals vs. Separate Copies
Article Access Fees
Subscription Price ($)
$0 $5 $10 $20 $30
$100 19.6 10.4 7.1 4.3 3.1
$250 46.0 24.4 16.7 10.2 7.3
$500 90.1 47.8 32.6 19.9 14.3
$1,000 178.3 94.8 64.5 39.4 28.3
Effects of PriceChanges on Subscribers (1998)
Price Changes
Individual Subscriptions
Institutional Subscriptions
From To From To Loss From To Loss
$100 $150 2,500 1,450 1,050 2,500 2,379 121
$150 $250 2,500 920 1,580 2,500 2,311 189
$250 $500 2,500 547 1,953 2,500 2,094 406
$500 $1,000 2,500 111 2,389 2,500 1,870 630
Usefulness & Value of Scholarly Articles
• Information serves many purposes
• Highly important to these purposes
• Readers are willing to pay a high price for the information in their time
• Information results in improved performance
Usefulness, Value, and Impact of Information
• 198 readings per professional• Evidence of the consequences of reading
– Considerable savings result
– Improved productivity, quality, and timeliness of work
– Achievers read more than others
– What users are willing to pay for information
– Purposes of reading
– Importance compared with other resources
The Contribution that Libraries Make to this Use, Usefulness,
and Value
General Approach
• Examine overall communication forms and patterns
• How users spend time communicating
• Role of libraries in supporting communication activities
Examples of roles of libraries:
• Reduce communication time• Make communication time more efficient and
effective• Provide better information, faster and less
expensively• Strive to increase the productivity, quality, and
timeliness of users’ work, teaching, research, and other purposes for which information is used
Proportion of Readings of Library-Provided Documents and Documents From Other
Sources Which Result in Savings
0
20
40
60
80
100
AllDocuments
Journals Books InternalReports
LibraryOther Sources
Productivity of Professionals, As a Function of Amount of Library Use
0
20
40
60
80
100
Frequent LibraryUsersInfrequet LibraryUsers
Proportion of Readings of Library –Provided Documents and Documents From Other
Sources Which Result In Improved Quality of Work
0
20
40
60
80
100
AllDocuments
Journals Books InternalReports
LibraryOther Sources
Proportion of Readings of Library-Provided Documents and Documents from other Sources
Which Result in Performing Work Faster
0
20
40
60
80
100
AllDocuments
Journals Books InternalReports
LibraryOther Sources
Comparison of Library Use by Persons Recognized by Special Awards, “Fast
Trackers,” and Cohorts
0
10
20
30
40
50
60
70
SpecialAwards
"FastTrackers"
Serve onTeams, etc.
Persons RecognizedOthersFast Tracker Cohorts
Library Cost, Value, and Worth
• Library cost - $610 per professionals
• User price/cost of information - $5, 190
• User cost to acquire information - $1,090
• Current organization cost - $1, 700
• Cost of alternatives to library - $5, 010
• Potential “lost” benefits - $12, 200
Indicators of Value and Worth
• Ratio of user cost to acquire information to library cost
1.8 to 1
• Ratio of “willingness to pay” value to library costs
8.5 to 1
More Indicators of Value and Worth
• Ratio of cost alternatives to current organization cost
2.9 to 1
• Ratio of potential “lost benefits” to current organization cost
7.2 to 1
Without Information With InformationCenter Center
Professionals Spend Professionals Spend Professionals Have 121 Hours 27 Hours 94 Hours Available
Acquiring Information Acquiring Information For Thinking,
Experimenting,
Etc.
Time of One Equivalent ofInformation Saves Five Professional Professionals’
Time
Special Library Helps Achieve Parent Organization Goals
• Increase profit (or productivity) and get more for less
• Perform work better and with greater quality
• Speed products from discovery to the marketplace
Increased Profit (or productivity)
• >1/3 of library uses result in saving time or money• >40% of library-provided readings result in saving
time or money• Amount of library use correlated with 5 indicators
of user productivity• 5 studies show a positive correlation with
information-related expenditures and/or productivity
Better Performance and Greater Work Quality
• ~ 40% of library use said to be “absolutely required”
• ~ 60% of visits to libraries said to result in doing work better
• > 60% of readings from library-provided documents result in improved quality
• Professionals who use libraries more than cohorts and non-awards winners recognized through awards, etc.
Speed Products From Discovery to the Marketplace
• ~ 40% of library visits are said to help professionals perform work faster
• ~ 40% of readings of library-provided materials lead to doing work faster
Librarians Have Unique Knowledge of…
• How their community acquires and uses information
• The availability of alternative media, sources, and pricing options
• The economic trade-offs among these alternatives
• What is generally best for the entire organization
Future Roles of Special Librarians
• Decision makers for how organization adopts to electronic environment, by –– Keeping up with options and specific products– Figuring real costs (cost per use; total costs)– Negotiating leases– Voice of reason
• Purchasing / negotiating for entire organization
Goals for Librarians
• Discuss e-publishing issues with your boss
• Identify true costs of communication
• Predict what to expect with electronic journals and share information concerning e-journal realities
• Develop negotiating skills and knowledge of source and media options
