Open Access News

John Houghton and eight co-authors, Economic implications of alternative scholarly publishing models:  Exploring the costs and benefits, January 2009.  A major (256 pp.) report to JISC. 

From the press release:

...The research and findings reveal that core scholarly publishing system activities cost the UK higher education sector around £5 billion in 2007. Using the different models, the report shows, what the estimated cost would have been:

• £230 million to publish using the subscription model,
• £150 million to publish under the open access model and
• £110 million to publish with the self-archiving with peer review services plus some £20 million in operating costs if using the different models.

When considering costs per journal article, Houghton et al. believe that the UK higher education sector could have saved around £80 million a year by shifting from toll access to open access publishing. They also claim that £115 million could be saved by moving from toll access to open access self-archiving.

In addition to that, the financial return to UK plc from greater accessibility to research might result in an additional £172 million per annum worth of benefits from government and higher education sector research alone.

JISC’s Chair Professor Sir Tim O’Shea said, “The argument for moving from more traditional subscription or toll-based publishing to a model that allows for greater accessibility and makes full use of the advances in technology cannot be ignored. This report shows there are significant savings to be made and benefits to be had.

“JISC will work with publishers, authors and the science community to identify and help to remove the barriers to moving to these more cost-effective models,” he added....

From the summary on the landing page:

...Scholarly publishing...is central to the efficiency of research and to the dissemination of research findings and diffusion of scientific and technical knowledge. But, advances in information and communication technologies are disrupting traditional models of scholarly publishing, radically changing our capacity to reproduce, distribute, control, and publish information. The key question is whether there are new opportunities and new models for scholarly publishing that would better serve researchers and better communicate and disseminate research findings (OECD 2005, p14).

Debate on the economics of scholarly publishing and alternative publishing models has focused almost entirely on costs. And yet, from an economic perspective, the aim is to have the most cost-effective system, not (necessarily) the cheapest, and however much one studies costs one cannot know which is the most cost-effective system until one examines both costs and benefits. Hence, the aim of this project was to examine the costs and benefits of three alternative models for scholarly publishing (i.e. subscription publishing, open access publishing and self-archiving). In so doing, it seeks to inform policy discussion and help stakeholders understand the institutional, budgetary and wider economic implications.

The project involved two major phases:

• Phase I: Identification of costs and benefits – sought to describe the three models of scholarly publishing, identify all the dimensions of cost and benefit for each of the models, and examine which of the main players in the scholarly communication system would be affected and how they would be affected; and
• Phase II: Quantification of costs and benefits – sought, where possible, to quantify the costs and benefits identified; identify and where possible quantify the cost and benefit implications for each of the main players in the scholarly communication system; and, where possible, compare the costs and benefits of the three models....

From the section on comparing costs and benefits (pp. 211f) in the body of the report:

As noted, it is not possible to compare toll with open access publishing directly at the national level as they perform very different roles: toll access publishing seeks to provide UK subscribers with access to worldwide research (to the limits of affordability), whereas open access seeks to provide worldwide access to UK research. Therefore, we approach the question from both sides....

Because of the lag between research expenditure and the realisation of economic and social returns to that research, the impact on returns to R&D is lagged by 10 years....[T]his has the effect that over a transitional period of 20 years we are comparing 20 years of costs with 10 years of benefits....

[Gold OA:]  We estimate that an all author/producer side funded OA publishing system for all journal articles produced in the UK would have cost around £170 million nationally in 2007, of which around £150 million would have related to higher education outputs – approximately 0.74% of GERD and 2.43% of HERD, respectively....

Ignoring potential cost savings and given the assumptions outlined above (including inflating costs at the higher 5% per annum), we estimate that over 20 years:

• The cost of OA publishing for higher education would be around £1.8 billion in Net Present Value, whereas the estimated impact on returns to Higher Education R&D Economic implications of alternative scholarly publishing models 214
  (HERD) would be around £615 million, a benefit/cost ratio of 0.3 (i.e. the benefits would be less than the costs); and
• The cost of OA publishing nationally would be around £2 billion in Net Present Value, whereas the estimated impact on returns to UK Gross Expenditure on R&D (GERD) would be around £2.4 billion, a benefit/cost ratio of almost 1.1 (i.e. the benefits would be marginally greater than the costs) (Table 6.1)....

[Green OA:]  We estimate that a system of OA (publications) repositories for journal articles with all outputs posted once, would have cost the UK around £23 million per annum nationally in 2007, of which £18 million per annum would have related to higher education. Ignoring potential cost savings and given the assumptions outlined above, we estimate that over 20 years:

• The cost of OA self-archiving for higher education would be around £189 million in Net Present Value, whereas the estimated impact on returns to Higher Education R&D (HERD) would be around £615 million, a benefit/cost ratio of 3.2; and
• The cost of OA self-archiving nationally would be around £237 million in Net Present Value, whereas the estimated impact on returns to UK Gross Expenditure on R&D (GERD) would be around £2.4 billion, a benefit/cost ratio of 9.9....

These comparisons suggest that the additional returns from enhanced accessibility and efficiency alone would be sufficient to cover the costs of OA self-archiving in parallel with subscription publishing (i.e. ‘Green OA’ self-archiving without subscription cancellations), independent of the activity cost savings noted above.

Indicatively, putting the notional impacts of enhanced access into year one to simulate a post-transition ‘steady-state’ alternative OA self-archiving system, returns a benefit/cost ratio of 36 for higher education and 110 nationally. This suggests that the benefits of an OA self-archiving system with overlay services would substantially outweigh the costs....

From the conclusions and recommendations (pp. 231f):

...There are...major differences between impacts [of OA] during a transitional period and those in a hypothetical alternative ‘steady-state’ system....We took the view that it was more realistic and of more immediate concern to model the transition, but it must be emphasised that a transitional model returns significantly lower benefit/cost ratios than would a hypothetical alternative ‘steady-state’ model. Hence, while the findings presented should be interpreted with caution, the assumptions and modelling are very conservative....

[D]ifferent models for scholarly publishing can make a material difference to the returns realised, as well as the costs faced....

[W]hile net benefits may be lower during a transitional period they are likely to be positive for both OA publishing and self-archiving alternatives (i.e. Gold OA) and for parallel subscription publishing and self-archiving (i.e. Green OA). This suggests that there are gains to be realised from moving towards more open access publishing models and that, despite the lag between the costs and the realisation of benefits, the transition would probably be affordable within current system-wide budgetary allocations....

Recommendations...

Overcoming the barriers...

• Ensuring that research evaluation is not a barrier to innovation (e.g. by developing and using metrics that support innovation in scholarly publishing, rather than relying on traditional evaluation metrics that reinforce and reward traditional publishing models and behaviours);
• Ensuring that there is funding for author or producer side fees (e.g. encouraging all research funders to make explicit provision for publication charges, and encouraging higher education and research institutions to establish funds to support publishing fees);
• Encouraging and funding the further development of institutional and/or subject repositories; and
• Supporting advocacy initiatives to inform and educate funders, researchers and research managers about the potential impacts of alternative publishing models....

Realising the benefits...

Our analysis suggests that open access self-archiving, either in parallel with subscription publishing or with overlay services, may be very cost-effective, although more information is required on repository costs and the potential benefits of greater integration of publications with other forms of research output, their integration into learning materials, and the curation and Exploring the costs and benefits sharing of research data (Box E-I). Hence, there is scope to focus greater attention on the development of repositories. This might include:

• Encouraging and supporting the development of institutional and/or subject repositories;
• Encouraging greater focus on the operational effectiveness of repositories (e.g. enhancing metadata standards and quality, effective federation, enhanced
  discoverability and searchability, supporting the development and use of metrics and reporting suitable for research evaluation, etc.); and
• Encouraging greater sharing of information and experiences to enable stakeholders to better understand the costs and benefits involved and build more effective ‘business cases’ for repositories.

Our analysis also suggests that there may be considerable benefits available from a shift to open access scholarly book publishing....

PS:  Also see our past posts on John Houghton's research on the economic impact of OA.

Update (2/6/09). For interactive what-if analysis, see the

online model which makes a small subset of the the EI-ASPM Project cost-benefit modelling available to those interested in further exploring results and wanting to explore national, sectoral or institutional costs and benefits. It runs as an executable application within MS Excel, by simply clicking on the file after downloading. Each of the model elements is presented as a single screen worksheet. Copies of the model can be saved locally to record results and each of the worksheet models can be printed as a single page. Simply enter your preferred values into the Variables column of the Parameters Table and the results will be recalculated automatically. You can TAB between the active cells.

Update (2/13/09).  For a response from publishers, see the joint statement from the Publishers Association, the Association of Learned and Professional Society Publishers, and the International Association of Scientific, Technical and Medical Publishers, February 13, 2009.

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