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The obscene profits of commercial scholarly publishers

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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:

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:

(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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