Select Committee on Science and Technology Minutes of Evidence


Examination of Witnesses (Questions 40 - 59)

MONDAY 1 MARCH 2004

MR ROBERT CAMPBELL, MR RICHARD CHARKIN AND DR JOHN JARVIS

  Q40  Paul Farrelly: Concentration tends to increase margins, increase profitability. Some people would say that digitisation reduces the barriers, but if you have a substantial library as an independent, then face the basic costs of migrating on to that platform without financial strength, digitisation can clearly be a concentrator. Would you say that mergers and digitisation overall operated to increase margins for the business or not?

  Dr Jarvis: Decrease so far, certainly from our own experience. We have had to invest from those margins over the past five years. There is no shortage of aggregators, of services, people who have built independent servers; so there are the servers which run from the major publishing houses, but there is no shortage of places for the smallest publisher to mount his or her journals on. Obviously, there may be a difference in functionality, but again the value of that is decided by market freedom, and market forces. There will be some services which scientists will use and find the functionality enormously helpful; other services will invest their money in different functions, which will not be as accepted. At the end of the day, I do not think any publisher, however small, is omitted from participating in a digital future.

  Mr Charkin: I think there are clearly some scale advantages of being big, but I believe that those advantages are trivial compared with the added profit from doing a better job. A better job is typically to have a better-designed application—better websites in particular—which attracts people in. That is what matters.

  Q41  Bob Spink: We heard about your very high level of profits, which most manufacturers could only dream about, and we know of course that the content of the papers that you publish is often produced at the public expense and very rarely at your expense. Can you tell us how much of your profit margin is actually being invested in new digital technologies? Can you each give the percentage?

  Mr Charkin: The percentage of what?

  Q42  Bob Spink: A percentage of your turnover that is re-invested in development of new technologies—or whatever the figures are; just give me the figures.

  Mr Campbell: Things come up, you see—

  Q43  Bob Spink: No, I just want the figures.

  Mr Campbell: I would guess for next year it is going to be a lot for us because you go in cycles and you have to reinvest in a new system. It will be some millions of pounds next year, so a percentage of—

  Mr Charkin: It is 30% for us.

  Mr Campbell: We certainly have not invested as much as 30% in new technologies for this year. My colleague is working something out to give you.

  Dr Jarvis: On our STM business, I would think it is something like 10-15%. I really cannot be more accurate than that. Of course, STM journal publishing is only one arm of our business, so it would be a smaller percentage of the overall profit.

  Q44  Dr Iddon: When an author submits a paper to you, it is quite normal to send a number of free reprints. I used to get 50 paper re-prints. We have some evidence that commercial journals are now beginning to charge authors for copies of their own work. Somebody from the University of Leiden has written to the Committee complaining that he was charged

250 for a PDF file of his own paper. Is that a growing trend?

  Mr Campbell: No, it is quite the reverse. Our company policy is that authors get a PDF free, which they can then use to disseminate their own article; and so it is an added service to our authors. The answer to the previous question is 25%—my colleague has just given me the figure from the accounts.

  Q45  Dr Turner: A lot of journals are increasingly being sold as bundles. Would it surprise you to know that there has been a certain amount of criticism of this practice in that publishers are cutting tough deals with libraries, which, if they want to take the leading journal at a reasonable rate, have to take a whole lot of other subsidiary journals with it, which they may or may not want very much. Not only that, but these contracts go for a long time; they have penalty clauses and so on. Do you think these criticisms are justified?

  Mr Campbell: It was a new pricing model which was pioneered in Britain and subsidised by the state initially to get it started from HEFCE, as I mentioned earlier, and now known as the Big Deal. In our view it is a transitional model and we are moving to different sorts of pricing models and working through the Big Deal as part of that evolutionary process. It is working well; it is enabling us to get to a lot more libraries at the moment, but I do not think it is the answer and I expect we will evolve through that to more accurate pricing models based on use.

  Q46  Dr Turner: Are you looking to something which will give libraries a bit more flexibility?

  Mr Campbell: Yes, and based on size of the institution, usage, the value to those institutions of the particular type of model.

  Mr Charkin: Absolutely. Flexibility, I am sure, is going to come and we are on the way.

  Q47  Mr Key: What are you doing to preserve digital archives, and once libraries have paid for electronic publication are they guaranteed access for ever?

  Mr Campbell: Yes. One of the problems is that publishers such as the three of us here are developing systems quite fast and are able to create legacy, which is a huge investment. Why I was stalling a bit on the percentage of technology was that I was trying to work out how much we are spending on so-called legacy this year, which is digitising backgrounds to create the backruns you were talking about. It is likely that the better funded publishers will be setting up their own archive or legacy and they will be able to update the technology and it is charged for by the subscription price to libraries, and libraries have a permanent access to that material that they subscribe to. The concern over, let us say, an open access or the author PAYS model is that if you need to shift your technology, as happens regularly, who pays? Does the new crop of authors of that year pay for the huge investment in changing your backrun to suit modern technology? Alongside that most large publishers are working with the library community on library solutions as well and the British Library is active in that and Harvard and California and the Royal Dutch Library. There are a number of libraries who have signed agreements with publishers to create archives outside the publishing house as well. We have not got there yet but quite a robust system has evolved. I would claim it is a point in favour of the submission model, and there is a system called JStore and others that we work with as well.

  Q48  Dr Turner: What is that?

  Mr Campbell: It is a North American service where they digitise backruns of journals and sell that service to libraries and libraries have access to the backruns of journals. It is particularly strong in economics and ecology.

  Q49  Paul Farrelly: I want to address very briefly copyright. We only have a short time so let me put it in the starkest terms. What would be the effect on your business and the industry if your requirements to obtain copyright were outlawed as an onerous term and there were restrictions placed on inducements to assigning copyright? Also, because we do not operate in isolation, what would be the effect on publishing in the UK and indeed in Europe if it was adopted Europe-wide?

  Dr Jarvis: I think this is one of the most important questions and it is a philosophical question almost because if you think about copyright and the copyright system and how it works, the only alternative is patronage and that is a system which we used to have where publishing was funded by royal families or the church or governments. Since the former two would not be active in this any more it is basically government. What we all have to think about very carefully indeed, therefore, is that in this industry there are certain aspects of open access which are important and which we are looking at, but as soon as anybody funds an author to publish there is an inherent pressure, and history proves this, that ultimately the person who pays can in the most benign way begin to influence what gets published, and what the message is—In short, what we see, read and hear. That sounds a little dramatic but I genuinely believe that this is something which all of us have to think very carefully about. A copyright system, which embodies the unimpeachable right of an author to publish their work wherever they want for no cost, is something which we would throw away at our peril. The subscription model may sit alongside an open access system—and as I said earlier, there may be some niche publications where it is valuable to offer authors the chance to publish their work in an open access system by paying for it. However if that ever replaces the inalienable right of an author to publish their work where they want to without any patronage from whatever source, we should beware. Copyright is something which is essential to us. It is the author's work, it is their intellectual capital. Once they start to be coerced into putting it here, putting it there, I think we unpick something which took us a long time to build.

  Q50  Paul Farrelly: Anything to add?

  Mr Charkin: I support that. There is also a risk. Copyright is in an interesting legal phase at the moment because there are various changes in electronic delivery and such like, but it is very hard to start slicing up copyright and saying that scientific papers are one sort of copyright and literary novels are another sort of copyright. What has been fundamentally strong about copyright is that it does not differentiate. It is the author's work, it is his or her right. Starting thinking about changing rules for one sub-sector is rather dangerous apart from anything else.

  Q51  Dr Harris: I want to come back to one of Dr Iddon's questions because he asked all of you, how do you explain an average journal price increase of 58%, "average" being the key word there, in the past five years compared to an increase of 11% in the RPI, and the 58%, he said, came from the Consortium of University Research Libraries. Mr Campbell, your answer was, "Ah, because there are more journals now". I am not a great mathematician but I understood that the question, including an average price assumed, allowed for the increase in the number of journals, so can you clarify whether you think that figure is wrong and it is a fraudulent figure, or whether your journals have not gone up by that much and it is some other nasty publisher out there who is making very big profits?

  Mr Campbell: There are relatively few new journals now. The year when the most journals were launched was something like 1968. Since then there have been fewer journals launched each year, so this is a myth, that there are more titles being launched, there are more papers being published, so the big successful journals attract more copy and, even though they might have higher rejection rates, a lot of them are growing in size every year. If you, for example, look at the cost per article from our list, it has gone up by 2.8%. The actual cost to subscribers per article from last year to this year has gone up 2.8%, so it is more or less in line with inflation.

  Q52  Dr Harris: Is that across the range or is that just Blackwell?

  Mr Campbell: That is Blackwell.

  Mr Charkin: Ours would not be significantly different. The thing we measure is the cost per access of our various papers and that has come down significantly.

  Q53  Dr Harris: Does that include the back catalogue?

  Mr Campbell: That comes down hugely. If you include the archive the cost per article which you could access on line drops.

  Q54  Dr Harris: If the libraries tell us that the price per article has gone up, and you are saying you are only around inflation, then some players in the market have increased the price per article. I cannot believe there can be this dispute over figures but I remember seeing a presentation, and we will check this, where the price per article generally had gone up higher than that.

  Mr Campbell: Our figures are in the open. Our price per article for 2003 was 1.77 and this year it is 1.82. If you bought the whole list at full subscription price, which does not happen—

  Q55  Dr Harris: Just to change the subject, everyone worries about publication bias, that negative results are not published. Do you think publishers have a role in solving this major worry by providing a system maybe on open access that enables all those negative studies to be logged in some way, or do you think that is an issue not for publishers but for the pharmaceutical industry and so on?

  Mr Campbell: The pharmaceutical industry would not publish negative results.

  Chairman: Because they get a lot!

  Q56  Dr Harris: Some people feel that research on human beings is not ethical unless it is going to be published, assuming it is fit for publication in terms of peer review. That is what I am getting at. Is it right that we should experiment on people and then not publish the results?

  Mr Campbell: No; I think that is a fair point. With most medical journals you have to accept that if a negative result came through there would be, I guess, less chance that the referees would recommend its publication. We do sometimes publish negative results but I would think fewer get through refereeing than other papers.

  Q57  Dr Harris: That is my question. What are we going to do about it?

  Mr Campbell: People have tried publishing journals on negative results and they have been complete failures because nobody wants to subscribe to them.

  Dr Jarvis: We could publish more but there is a cost to it all. One could do it by open access or by subscription model but the more papers you publish there will be an increased cost. It does cost. As somebody said earlier, you take this stuff from scientists and you do not do anything to it. That is not true. We do not take manuscripts from authors and give them back to them and charge them for that. There is a great deal of cost and work put into that first. We have had more papers submitted to us and we have published more papers, which has partly contributed to the 58%. There is a lot of R&D out there and a lot of output from it and unfortunately library budgets have not kept pace with that. That is something which we have banged on about for a long time. We do not write these papers. These papers are out there and if publishers like ourselves do not publish them other publishers do. There are new entrant publishers coming in all the time with new ideas, new journals, niche journals, people spinning off journals. There is a lot of publishing out there, not driven by us.

  Q58  Chairman: Would the whole system not work in the same way if the publisher licensed the article copyright and did not own it?

  Mr Campbell: Yes. Some publishers do not insist on full copyright assignment but in effect have an exclusive licence to publish.

  Mr Charkin: We just take a licence.

  Q59  Chairman: I know.

  Dr Jarvis: One of the down sides of that, of course, is that if your author's work is then stolen or changed, what publishers can do because of their scale and their reach is to do something about that. Individual authors would find it very difficult if their article was used and changed.


 
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