Great news! 44% of libraries will save money from Green OA!
June 2, 2012
An article in Times Higher Education tells of a new report, The Potential Effect of Making Journals Free After a Six Month Embargo, prepared by Linda Bennett of Gold Leaf for the Association of Learned, Professional and Society Publishers [ALPSP] and our old friends The Publishers Association.
And this report contains very good news. They contacted 950 libraries around the world to ask what effect Green Open Access mandates would have on them, getting 210 replies of which 185 pertained to science holdings. Of these replies, 10% said they would cancel subscriptions for all journals whose articles were freely available after six months, and another 34% said they would cancel some journals. So in total, that means that Green OA mandates, such as the ones that the current White House petition advocates, would allow 44% of science libraries to save money on subscription — money which can be reinvested in staff, in technology, in development of new discovery systems, and more.
Thank you, publishers, for giving us this valuable information!
Two things puzzle me, though.
First, there seems to be a typo in Section VII, Recommendations, of the report. It says “It is strongly recommended that no mandate is issued on making all or most journal articles available free of charge after a six month embargo”. Looks like the word “no” was accidentally substituted for “a”. Because the obvious conclusion from the information in the report is that, for the sake of libraries, universities, the economy and citizens, open access should be implemented as quickly as possible.
Second, I don’t understand why the Times Higher Education article says that the report claims open access will bankrupt publishers. To assess that claim, let’s take another look at our buddies Elsevier. Their 2011 profit, remember, is 37.3% of revenue. Suppose 10% of their libraries cancelled all subscriptions — let’s pessimistically assume that that would cut off 10% of revenue. (That’s unrealistic because the big libraries that bring in the big bucks are not the ones likely to cancel, so the 10% of subscribers they lose would likely be the Little Guys; but let it slide.) Of the 34% that said they would cancel some journals, let’s assume an (again pessimistic) average cancellation rate of 50%: so Elsevier would lose another 17% of their revenue. In total, then, they’d lose 27% of revenue. That would bring them down to revenue of only £1502M. Assuming (again pessimistically) that they were unable to cut their costs now that they’re not serving those libraries, costs would stay at £1290M, meaning that their profit margin would be cut to 16.5%. Less than pharma and banks, but more than financial services, software, telecomms, or food & drink; and less double what oil & gas companies make.
So with all that taken into account, here is my gift to publishers: a corrected page 33 of their report:
1. It is strongly recommended that a mandate is issued on making all or most journal articles available free of charge after a six month embargo.