The obscene profits of commercial scholarly publishers

January 13, 2012

In an article that many of you will now have seen, Heather Morrison demonstrated the enormous profits of STM (Scientific, Technical and Medical) scholarly publishers.  The figures are taken from her in-progress dissertation which in turn cites an article in The Economist.  It all checks out.  I emphasise this because I found the figures so hard to believe.  Here they are again: profits as a percentage of revenue for commercial STM publishers in 2010 or early 2011:

  • Elsevier: £724m on revenue of £2b — 36%
  • Springer‘s Science+Business Media: £294m on revenue of £866m — 33.9%
  • John Wiley & Sons: $106m on revenue of $253m — 42%
  • Academic division of Informa plc: £47m on revenue of £145m — 32.4%

So it’s evident that profits on the order of 35% are pretty typical for commercial STM publishers, and that Elsevier’s figures are not an aberration.  Not only that, but all four of these companies’ profits as a proportion of revenue are still increasing — by 2.4%, 4%, 13% and 3.3% respectively.  The U.K. Office of Fair Trading noted back in 2002 that “the overall profitability of commercial STM publishing is high, not only by comparison to ‘non-profit’ journals (which is not surprising), but also by comparison to other commercial journal publishing”.

I wanted to be sure that I was assessing this fairly, so I looked through Elsevier’s annual reports for the last nine years — happily, they make them available, if not particularly easy to find.  What I found is that they have been consistently bringing in profits in the region of 33% throughout the last decade.  Specifically:

  • 2002: £429m profit on £1295m revenue – 33.18%
  • 2003: £467m profit on £1381m revenue – 33.82%
  • 2004: £460m profit on £1363m revenue – 33.75%
  • 2005: £449m profit on £1436m revenue – 31.25%
  • 2006: £465m profit on £1521m revenue – 30.57%
  • 2007: £477m profit on £1507m revenue – 31.65%
  • 2008: £568m profit on £1700m revenue – 33.41%
  • 2009: £693m profit on £1985m revenue – 34.91%
  • 2010: £724m profit on £2026m revenue – 35.74%
  • UPDATE (14 March 2012) The 2011 figures are out: £768M on £2058M revenue – 37.3%

(I have not been through the same exercise for Springer, Wiley or Informa, but there is no reason to expect that the results would be any different.)

What does it all mean?

Yes, publishers have a right to make a living.  Not only that, but they have a right to make as big a profit as the market can bear (though of course when they form a cartel that distorts the market monopolistically, that changes things).

But here’s what it means to scientists that Elsevier’s profit is 35.74% of revenue:

You just have to ask yourself whether that’s where you want your money going.

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92 Responses to “The obscene profits of commercial scholarly publishers”

  1. Anne Jefferson Says:

    Almost enough to make me want to be a shareholder.

  2. David Says:

    should we as authors get more royalties? should universities who pay our wages be paid for the time we spend for peer-reviewing articles and book proposals (usually for free or for very symbolic sums)? we are assessed on publications in rated journals, so we have to continue publishing here; where we can effectively do something is in the peer reviewing process. An article review takes me about 2 to 3 hours, let’s ask for 50 dollars, or 100 dollars per review for commercial publishers

  3. Paul Says:

    Forgive my ignorance, but none of these publishers are geared to return any of these super profits to authors are they? I know that being paid royalties for scholarly publications is a contentious issue, however incredible profits are being made regardless. I just find it curious that when decent sums are being paid for copies of your work, you as the author see 0% of that. In fact, I believe it usually COSTS authors to publish in these journals (i.e. purchasing images for the papers, purchasing copies of the journal itself, etc). I’m admittedly green to the world of academic publishing so I’m sure there’s a good reason for this that I’m not aware of – I’m just interested as to what it is.


  4. @Daniel: No, we need to figure out a way to change our system, such that what we publish again becomes more important than where we publish!

  5. Mike Taylor Says:

    You are right, Paul and David, that it is vanishingly rare for academic authors to be paid for the journal articles that they write. I have never heard of this happening, in fact, and I’d be interested if anyone knows of any special cases where it has happened.

    But I am OK with that. On the whole, writing papers is part of what academics get paid their salary for, so there’s no particular reason whey they should get paid twice. (Again, there are exceptions: people like me research and write in our spare time just because we like to; but there’s no reason anyone should be obliged to pay me to do what I choose to do anyway.)

    But it certainly wrong that journals which assume ownership of the papers also charge authors. As you know, I would rather that publishers never take copyright, but if they are going to do that, then they most certainly need to provide something in return, and at the very least that something should include not charging the authors for the privilege of giving them free content.

    On being paid for peer-review: I half-facetiously suggested this in my Times Higher Education piece, but more as a deterrent than as a source of income. If we were to charge a realistic consulting rate to publishers, then $100 for 2-3 hours’ work would be far too low, and something more like £100 ($150) per hour would be more reasonable — something in the same ball-park as commensurate professionals like lawyers and physicians. But, really, the progress of science is better served by sweeping commercial considerations as far out of the way as possible, and just considering reviews as one part of the way we contribute. Just so long as we are contributing to science rather than to Science!

  6. Mike Taylor Says:

    Oh, and Anne Jefferson wrote:

    Almost enough to make me want to be a shareholder.

    If you can get in, make a profit in the next year to eighteen months and get out again, then maybe. But I think that all academic publishers in the sciences are heading for an almighty crash as the simmering indignation of researchers rises towards boiling point. If I had Elsevier shares, I’d be selling them, not buying more.


  7. @Paul: the only reason why this system exists today is history: it once made sense to outsource publishing to people with printing presses. Now that nobody really reads paper papers any more, the reality has changed but the publishers use their profits to prevent modernization of scholarly communication (which most likely would force them out of business). See also my post linked above for more details and background.

  8. David Says:

    As an author, I do get royalties for my books, though this is not much (may 200-300 pounds a year per book). I do not get royalties for articles. But I am evaluated by the number of articles I publish in A or B rated journals. The ratings are those by the European Science Foundation. Initiatives like HAU and other open access journals change here the game, but only at the medium term. For the moment all their authors are high profile academics with permanent senior jobs who certainly have time and freedom to publish wherever it pleases them. If I were to submit an article for HAU (which I will enthusiastically do whenever I have something appropriate), I will have to explain this to my management and also consider that this publication will be “lost” in terms of my evaluation as a researcher – as long as HAU does not have a rating of its impact factor.

    And: Let’s not pretend to live in a bubble – some kind of idealised commerce free community which is only made possible by commerce and the system of capitalism. My point is: If we work we should be paid appropriately, or work for no cost if the project is a non for profit. I have no problem with either. If Elsevier really makes such huge profits, they should be held responsible for costs such as those of peer reviewing. That’s why my claim to 100 dollars per review (I work on a Portuguese pay roll =) considerably lower than a british or US american one)


  9. [...] Read the comments on this piece too – here. [...]

  10. Mike Taylor Says:

    David,

    In Portugal, do lawyers work for $33 per hour?

    Don’t underestimate the value of the work you do in peer-reviewing. The expertise that you bring is the result of (most likely) six to ten years’ training in a batchelor’s degree and then a doctorate, plus the extensive experience and relevant knowledge you’ve accumulated since then. If the professional-grade work that you do is going to be charged at all, it should be charged at a rate in keeping with that training and experience, just it is with other professions.


  11. The commercial publishers have been increasing subscription rates at about 400% the inflation. Even if we ask for reviewer compensation, why shouldn’t they just add these costs to their subscription rates?


  12. [...] costs of unemployment – again The obscene profits of commercial scholarly publishers (powerful context at the end, although why is no one mentioning that Darrell Issa, the leading [...]

  13. steve cohen Says:

    The Lead Story in the Science section of today’s NY Times is “Cracking Open the Scientific Process.”

    http://tinyurl.com/794zlur


  14. Shalom & Erev tov, Mike…you might wish to peruse a parallel paper…Thomas Lin, 2012. Cracking open the scientific process. Driven by the Web’s collaborative potential, many want to replace an age-old (and costly) system of submitting private research to commercial journals. THE NEW YORK TIMES, 17 January:D1, D4

    STEPHAN PICKERING / Chofetz Chayim benAvraham


  15. [...] threat is the Research Works Act (RWA), by which scholarly publishers like Elsevier (with its 36% profits as a proportion of revenue) hope to claw back total ownership of federally funded research.  The [...]


  16. [...] Dr. Mike Taylor (University of Bristol, Bristol, England, United Kingdom) of SV-POW! (see here and here) to oppose another US bill, HR 6399, the Research Works Act, which attempts to overturn the NIH [...]

  17. Wyatt Clark Says:

    Great post. This makes me curious what the profit margins of open access journals like PLoS are.

  18. Mike Taylor Says:

    PLoS are very transparent about their financials, in keeping with their general ethos of openness. You can find their annual reports and their tax returns (most recent: 2010) on their Progress Updates page. For 2010, the total operating revenue was $12.995M, yielding a profit of $785k — 6% of revenue. This was the first year that PLoS turned a profit, but then it’s such a young organisation that it’s not had a chance to get into a stable financial routine yet. (It’s hard to believe it only started in 2003, and PLoS ONE didn’t launch until 2006!)

  19. Wyatt Clark Says:

    Thanks for the information. Having published in PLoS I am happy to see that their profit margins aren’t as ridiculous as other publishing groups. There is absolutely no reason Elsevier should have a 33% profit margin. I hope universities can use this data to better negotiate with these companies.

    That being said, the way the scientific publishing world currently works there is a trade off between paying to have your article published in an open access journal, or not paying to have an article published as non-open access. I know a lot of people who would love to publish every single article in an open access journal but don’t have the funding to do so. I’m not sure what the alternative to authors paying for this is. Lord knows I’d hate to see banner adds at PloS CB.


  20. Actually, PLoS is a non-profit organization, so any surplus is invested immediately: A tax-exempt, 501(c)3, nonprofit corporation headquartered in San Francisco, California (Federal Tax ID 68-0492065) http://www.plos.org/about/what-is-plos/
    So there are no PLoS shareholders laughing all the way to the bank…
    Currently, the bulk of the revenue comes from PLoS One and I have the impression that they’re using the funds to try and keep up with the growth. IMHO, if this continues and prevents innovation, PLoS has a problem. But so far all looks well.

    Indeed, it is an interesting experiment and it will be exciting to see how far this experiment can scale.

  21. Matt Wedel Says:

    That being said, the way the scientific publishing world currently works there is a trade off between paying to have your article published in an open access journal, or not paying to have an article published as non-open access. I know a lot of people who would love to publish every single article in an open access journal but don’t have the funding to do so.

    We should all be agitating within our universities for university libraries to stop paying ridiculous subscription fees to commercial publishers, and instead have universities use that money to fund OA publications by their researchers.

    Also, I can’t speak for other fields, but there are quite a few OA paleontology journals that don’t charge anything to publish, either because they are state-supported or have other lines of support, or because they’re out to make a name for themselves, or both.

    Finally, PLoS ONE has a fee waiver for authors who can’t afford to pay. Obviously it won’t last if it’s abused, but it does exist. Other OA journals may also do this, but I haven’t checked.

    So there are options.


  22. [...] jQuery("#errors*").hide(); window.location= data.themeInternalUrl; } }); } svpow.wordpress.com – Today, 8:43 [...]


  23. [...] future of academic publishing in anthropology in Australia. This was prompted by a post about the obscene profits of commercial publishers, the content of which irked many, and I think the issues raised in both contexts have a lot of [...]


  24. [...] The obscene profits of commercial scholarly publishers [...]


  25. Does anybody know whether it is allowed to post pdfs of your (non-open access) publications on websites like Academia.edu?

  26. Mike Taylor Says:

    Posting PDFs of your own papers is widespread — see the list of researchers’ pages here, for example, but whether you’re actually allowed to do it technically depends on the policies of the specific journal in question, which may depend on the policies of the publisher. I’ve never heard of anyone getting in trouble for doing it, and I think that any publisher greedy and stupid enough to make trouble on this basis would reap a whirlwind of bad publicity.


  27. I always post every thing I publish on my website as soon as I have the PDF (and I often post the HTML version, too). I’d just hope they’d go after researchers like us one day…


  28. [...] from 2006-2010, an experience which turned us into complete Open Access advocates) managed to suck the greatest percentage of profit out of its system of volunteer labor and captured librarie… — 42%, beating out Elsevier’s 36%: In an article that many of you will now have seen, [...]


  29. [...] to have written so much about publishing politics recently, and so little about sauropod vertebrae!  That stuff is [...]


  30. [...] tended to be very critical of Elsevier on these pages [peer review, economics, PLoS clone, RWA, profits].  I’ve sometimes wondered whether that’s really fair: after all, Elsevier are just [...]


  31. [...] sense (research being mostly publicly funded and all, you would think it should be open access). And then I came across this article on the obscene profits of Science/Medical/Technical publishing. This is how it looks: But here’s what it means to scientists that Elsevier’s profit is 35.74% [...]


  32. [...] way of the profits of the academic publishing industry. Publishers like Elsevier and Springer have astonishingly high profit margins of 36% or more, dwarfing even those of Apple, and they aim to keep them that way. Academic publishers have a [...]


  33. [...] have drawn up sharply against it, such as Mike Taylor’s articles about it at SV-POW! (here, here, and here). I tend to be pretty liberterian in regards to the actions of businesses, regardless of [...]


  34. [...] on Elsevier here, here, here, here, and here. And keep a regular watch on Michael Eisen’s blog, it is not [...]


  35. [...] holandesa Elsevier lucrou $1,16 bilhões em uma margem de 36% da receita, em um ano de crise. E margens de lucro de mais de 30% parecem ser a regra para editoras acadêmicas, levando a considerações sobre o quanto as [...]


  36. [...] future of academic publishing in anthropology in Australia. This was prompted by a post about the obscene profits of commercial publishers, the content of which irked many, and I think the issues raised in both contexts have a lot of [...]


  37. [...] total revenues.”  (And indeed, 691 × $3000 = $2.073 M, which is about 0.065% of their 2010 revenue of £2026 M ≈ $3208 M.)  As Elsevier publishes 2639 journals in all, that amounts to just over a quarter of [...]


  38. [...] Elsevier boycott at The Cost Of Knowledge is the most visible sign of the recent uprising against exploitative publishing practices, but it’s far from the only one.  Anyone who’s been keeping an [...]


  39. [...] then restructure itself as an open-access publisher. That will probably mean saying goodbye to 30+% annual profit margins, but hey, wake up. If PLoS ONE can offer no length limits, no full color figure limits, and open [...]


  40. [...] because PLoS isn’t taking in enough money to cream off 36% of all revenue as profit, it seems likely that Elsevier’s response is going to be “Eerrrrrrrrrrrrmmmm…erm, [...]


  41. [...] aside, for a moment, that you pull down an astonishing-in-any-industry, surely-ripe-for-disruption 36% profit margin. The obvious (to me at least) solution is that all work needs to be made available under a true [...]


  42. [...] legislation. There is, apparently, no law against bundling and ruthless pricing that produces a profit margin in line with what monopolies [...]


  43. [...] the behest of others. Signing large long term license deals with no real get-out to publishers with 36% profit margins has not helped our professional image. 3. Commitment to the defence, and the advancement, of [...]


  44. [...] to propose solutions: you got yourselves into this damned mess, funnel a little of that £724 million in profits to some clever people and figure a way out. That said, I’m not above handing out [...]


  45. [...] they were able in 2011 to bring this up to £768M/£2058M = 37.3%.  This continues a fine trend of five successive years of increasing profits — not just increasing in absolute amount (although that’s true, too), but increasing as [...]


  46. [...] I often think about that in reference to barrier-based academic publishing. It doesn’t serve authors, it doesn’t serve readers, it doesn’t serve academic libraries, but doggone it, at least it costs vastly more than it should. [...]


  47. [...] de 37.3% comparado, por ejemplo, con el 24% registrado por Apple en 2011. Esto hace del 2011 el quinto año consecutivo en el cual las ganancias de Elsevier se han incrementado. Los editores están desangrando a las [...]


  48. [...] Publishers who are paying attention will surely start to realise that they have pushed their exploitative prices too far, and that they don’t hold libraries in a steely grip any more.  I wonder how this [...]


  49. [...] evidence is not evidence of absence.)  When embargo limits are cut down, it may be that instead of climbing for a sixth consecutive year, Elsevier will not be able to improve on their 2011 profit margin of 37.3%.  Their profit margin [...]


  50. [...] the public who funded it and the researchers who created it. In doing so, these corporations make grotesque profits of 32%-42% of revenue – far more than, say, Apple’s 24% or Penguin Books’ [...]


  51. [...] yes. Yes, they are. Because the profit margins of the Big Four academic publishers are all in the range of 32%-42% of revenue – much more than, say,Apple’s best-ever 24% margin in 2011. And that’s without [...]


  52. [...] yes. Yes, they are. Because the profit margins of the Big Four academic publishers are all in the range of 32%-42% of revenue — much more than, say, Apple’s best-ever 24% margin in 2011. And that’s without [...]


  53. [...] Springer has so far done an excellent job of positioning itself as the Good Guys, at least among the Big Four. (Wiley and Informa have not so far attracted much attention either way, but they will.) Crucial [...]


  54. [...]    那么Elsevier的利润究竟有多高呢?以下的数据摘自博客文章“The obscene profits of commercial scholarly publishers”: [...]


  55. [...] their desperate scramble to retain the 32%-42% profit margins they’ve grown used to, academic publishers have told us a lot of different lies (e.g. that [...]


  56. [...] certainly also vocal opponents to this plan – mostly those with vested interests in keeping the obscene profits of the traditional subscription access publishing system alive (which commonly generate >30% profit margins largely derived from the taxpayer-spending of [...]


  57. [...] think about this: the Big Four academic publishers have profit-margins between 32.4% and 42%. Let’s pick an typical profit margin of 37% — a little below the middle of that range. [...]


  58. [...] Thanks to Nick Scott-Samuel and Mike Taylor. [...]

  59. Dana Says:

    This is what Aaron Swartz died for.


  60. [...] geared toward curing cancer or reversing global warming – have profit margins of between 32 and 42%. Anyone with a scintilla of business experience will know that this is an absolute goldmine; to put [...]


  61. [...] I am not great with financial analyses, but this was written about on the SV-POW post “The obscene profits of commercial scholarly publishers.” Yes, the company needs to profit. Except, while other companies invest in inventory, [...]


  62. [...] corporations addicted to profit margins of 32-42% find it hard to give them up. As a result, while the world’s leading open-access journal, [...]


  63. [...] clears more profit than Walmart, Apple, and Disney. Data are from Mike Taylor, The obscene profits of commercial scholarly publishers, 2012. Chart by Stuart Shieber, [...]


  64. [...] access research that is tax-payer funded. And a large portion of that money goes straight into the pockets of shareholders for that particular journal. In a nutshell, the excessive amounts of money an institution spends to [...]


  65. [...] clears more profit than Walmart, Apple, and Disney. Data are from Mike Taylor, The obscene profits of commercial scholarly publishers, 2012. Chart by Stuart Shieber, [...]


  66. [...] known, the profit margins for the Big Four publishers (Elsevier, Springer, Wiley and Informa) are between 32.4 and 42 percent — not one of them has a margin as low as the highest end of the range you cite. Not only [...]


  67. [...] read here that Springer’s profit in 2010 was £294m on revenue of £866m — 33.9% [...]

  68. cbfant13 Says:

    Reblogged this on oliveberry and commented:
    A snip-it of Elsevier’s crazy profits…


  69. […] increasing prices to the institutions that provide that labor (universities) in order to generate high profit margins for themselves. Furthermore, despite the fact that much of the funding that pays for these […]


  70. […] increasing prices to the institutions that provide that labor (universities) in order to generate high profit margins for […]


  71. […] than those of all-OA publishers like PLOS, F1000 Research, eLife or Peerj? Sure, part of it is sheer profiteering, but even when you factor that out their prices are outrageous. It’s because they have to pay […]


  72. […] unless you’re a barrier-based legacy publisher, of course. Recall that the 2010/11 profit margins for the Big Four academic publishers came in at 32.4% for Informa, 33.9% for Springer, 36% for Elsevier and 42% for Wiley. And […]


  73. […] If newly minted PhD’s were released onto the job market with a firm grasp on the intricacies (and commercial interests) of scholarly publishing, we’d start to see the shifts that will ensure relevance of the […]


  74. […] Springer took 33.9% in 2010, WIley too 42% and the academic division of Informa too 32.4%. Details here. For comparison, Apple’s best ever reported profit margin was 24%. Exxon makes […]


  75. […] sorely underestimating. The large for-profit academic journal publishers are making 35-40%!!!! (as this well researched piece on the Sauropod vertebra picture of the week blog shows but I’ve seen the same numbers in other sources like this) This means greater than 1/3 […]


  76. […] with Apple’s 24 percent profit margin in their record-breaking 2011. This makes 2011 the fifth consecutive year in which Elsevier’s profit margin has increased. Publishers are bleeding libraries dry: […]


  77. […] evilsfor-profitacademicpublishingan idea for a Star Wars sequelArchimedes taking a bath,Steven Davis’s take on the “least harm” principlegenerously salted, peppered and grilled on an iron skilletincommensurabledescription of Kohler’s insight experiments from the perspective of Sultan the chimpanzeemy previous postvocal fry“lack of invariance”Riverfront Times.20089919 /* */ […]


  78. […] 9.24 tot 9.28). De commerciële wetenschappelijke uitgevers, die crisis of niet, boeken al jaren nettowinsten van 30-35% (and rising). Uitgevers zijn op het punt van mindering van prijzen notoir lastig te bewegen zoals bibliotheken […]


  79. […] of around £700 million. That’s a profit of about 35% of turnover (click here for similar figures for other […]


  80. […] non payés). De telles pratiques permettent à cette industrie d’afficher des marges record (de l’ordre de 30 à 40%) sur le dos des finances publiques. Je n’ai rien contre les entreprises qui gagnent de […]


  81. […] know, University libraries have to pay expensive subscription fees to scholarly publishers such as Elsevier, Springer, Wiley and Informa, so that their researchers can read articles written by their colleagues and donated to those […]


  82. […] Chiffres de 2010 établis par Mike Taylor […]


  83. […] disseminating, and evaluating research could be substantially improved. For-profit publishers enjoy extremely high taxpayer-funded profit margins. Traditional closed-door peer review is creaking under the weight of an exponentially growing […]


  84. […] of whether a writer is going the commercial publishing route or the self-publishing route, reviews of one’s work will ultimately affect the sales of […]


  85. […] multinationale cotée en bourse qui dégage des marges colossales. En 2010 ou 2011, ses bénéfices excédaient un tiers de son chiffre d’affaire : 720 millions de dollars pour 2 milliards de chiffres […]


  86. […] group listed in three stock exchanges draws colossal margins. In 2010, its overall profits exceeded one third of its revenue: 720 millions v. 2 billions. It is the outspoken leader of the scientific […]


  87. […] the mid-80s. In this time period, studies show that average journal subscription costs rose at what many academics have considered outrageous rates, with publishers having profit margins above those of most […]


  88. […] open access, but still receive lots of submissions. Journals in this pool generate most of the impressive profits large, lucrative publishers achieve (I’m sure you can guess their names) . I recently put […]


  89. […] fragt, warum Elsevier in den letzten zehn Jahren trotz Open Access Bewegung seine Gewinnmarge von 33% auf 39% steigern konnte  – und wir sprechen von einem Gewinn von $1.38 Milliarden bei einem Umsatz […]


  90. […] article in one of SciELO’s 900 journals costs only US$90 on average. Subtracting about 35% in publisher profits, the remaining difference between legacy and SciELO costs amount to US$3160 per article. With […]


  91. […] winning.” For publishing, see Elsevier, £0.8b profit on £2.1b revenue, and others. For software most pertinent to Moody’s post (concerning Open Document Format), see […]


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