EBooks are already a significant force in academic publishing. As with each previous wave of change in digital media, one of the first and most important tasks is to find a sustainable business model. However, it can also be one of the longest-lasting tasks: despite the apparent urgency of the need to establish reliable sources of sales (and eventually profits) some media have staggered on for years with only marginally viable models. Only the absence of competition and the ability to justify new media losses as a long-term brand-building cost have enabled them to continue. Eventually, however, time runs out and something has to give. Sometimes, the results affect more than just the staff of the companies. The decline in local news reporting is fast becoming a major area for civic concern; so too would be further declines in academic book publishing in the humanities and social sciences as important groups of scholars become cut off from the communications mainland. The business model problem is acute: the first copy costs are fixed, and yet sales have shown a steady decline. It seems that open access publishing, already a real force in the financially strong journals sector, might become one of the final straws for academic book publishing.
Yet, we believe not; there are viable alternatives. Not immediately visible and potentially hard to realize, we nevertheless think they should be explored in more detail and their practicality tested. Here, we propose both a business model for creation and distribution of scholarly monographs in eBook form, and a new approach to underwriting the high costs (and risks) of academic monograph publishing—costs high enough to have led some publishers to withdraw from the market.
The business model problem is usually industry-wide: as soon as one company cracks it, others often follow that lead or leave the field. It can be very hard to establish an alternative model for some time once a leading player has entrenched its own model in the minds of customers and business partners. So, for example, when the iTunes pay-per-download model came to dominate, the future for other models for music downloads, such as monthly subscriptions, became more difficult and only a small number of services were able to achieve limited success. Most of the major competitors followed Apple's lead.
However, the leading business model can become obsolete over the longer term. In particular, it may be challenged in five main ways:
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New technology presents both capability and opportunities for new business models.
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An existing competitor decides to take temporary losses for the sake of changing the game in the long term.
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New entrants with innovative business models (and usually without legacy businesses) introduce radically lower prices.
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Changes occur in regulation or taxation.
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Customers decide the prices are too high or the model too restrictive and abandon the product or service, even in the absence of competition.
It is likely that a combination of influences (1) and (3) is changing the book publishing model, in general, and the academic book publishing model, in particular. As it is already fragile because of declining sales, academic book publishing now faces the challenge of the eBook, with its very different value-chain.
At the same time, the environment in which the scholarly monograph is being published is changing—whether in print or eBook form. The global academic ecosystem is expanding. There continues to be growth in higher education despite the road bumps of the recession. There are more academics, more scholars conducting research, and the measure of value for money is frequently being determined either by output or by the quality of that output. The pressure to publish is greater than ever under the influence of either metrics created by the institution or by exercises such as the UK's Research Assessment Exercise and its successor, the Research Excellence Framework.Footnote 2 Such measures sometimes prioritize journal publishing, creating a further pressure on monographs.
Monograph publishing faces some substantial structural issues (regardless of the impact of the recent recession). Although the cost of print and distribution can he held to be falling under the impact of eBooks and the internet, first-copy costsFootnote 1 remain high: in the academic field, quality has to be maintained and that carries a cost in terms of authoring and editing that cannot be cut back without a risk to both scholarship and the integrity of publishing. The selective nature of academic monograph publishing (often only a handful of titles per publisher per year) reduces opportunities for economies of scale as there are only a small number of titles across which fixed costs such as salaries can be amortized.
To add significantly to the cost issues, these costs are distributed across a dramatically smaller sales base than they were in the past. Globally, the sales of monographs have fallen from 3,000 copies thirty years ago to under 400 copies now: each title is therefore under immense pressure to generate an effective return. As budgets are further squeezed, this is likely to get worse. Sales, whether as eBooks or print copies will decline, origination costs will be amortized over an ever decreasing number of units and the monograph could die. Already many publishers are refusing to publish these types of titles as they see no way of making them sustainable.
Indeed, the cost of getting to first copy is likely to go up in the short term as whatever publishers have spent on print and physical distribution they are now spending on restructuring their companies bringing in people with new skills (usually at a higher cost than the older staff) and digitizing their backlists. Although it may come down again once workflow systems have been reworked for the digital age, some work is simply not possible to automate and the reading speed of reviewers, editors, and proofreaders is unlikely to change.
But, the need of scholars to write, publish, and read does not go away. As a number of studies have shown, most recently one from Berkeley's Center for Studies in Higher Education, Assessing the Future Landscape of Scholarly Communication,Footnote 3 academics still want the services that independent publishers provide, namely selection, the organization of peer review, editing, typesetting, formatting, making available in a number of print, and e-formats, as well as sales and marketing. Curation in light of a multitude of versions is becoming increasingly important as scholars want publishers to produce and keep secure the version of record.
We noted earlier that it might be possible to use both the potential of new technologies and the potential for innovative business models offering radically lower prices to provide a path towards securing the future of the academic monograph. Technology enables us to identify and use new channels as well as new delivery formats, eBooks in particular. It also allows us to explore ways of adding value both to content and to metadata that assists discovery by end-users and libraries’ ability to pay for and manage eBooks.
With reference to innovative business models, we can also see that there is a potential for making the academic monograph model sustainable, although perhaps one that comes with a price-tag. The challenge to decaying business models may produce a stronger structure in the long term, albeit at the expense of fragile incumbents: this effect has been noted in many industries, from microelectronics to shipbuilding.
How do eBooks fit into the overall picture? Because of the first-copy costs problem, they do not offer an immediate potential for drastic cost reductions. In addition there are no clear, established sales and distribution channel as there are with printed books. The marketplace is chaotic. A first tier of aggregators have appeared, but their services are far less developed than the older models of library supply and bookshop channels, and little is known for certain about the preferred purchasing and use habits of the eBook market.
A Business Model for Individual Publishers to Increase Distribution
However, in the medium term the weightlessness of eBooks creates an advantage: they can flow freely through networks in a way that a physical product cannot. This flexibility allows new business models, and some publishers are testing the waters with these models. The freemium model described in the following section is being tested in various forms. The jury is still out as to whether or not it will work, but it addresses a number of the issues we have already identified—in particular, the reducing size of the market for academic monographs (we should be clear here that we are describing business models for monographs: we do not speculate on whether these models might work for textbooks).
One element of stabilizing the model is to improve the sales from the very low numbers noted earlier. However, can the book achieve wider distribution and sales than the current model allows without a considerable increase in marketing expenditure? We can, for example, take advantage of technology to deliver a range of products based on the same core text, but with different value added at a range of prices. Additional materials may be charged for on a multitude of scales representing the value to the end-user. In addition various value added stages might include extra functionality, extra metadata, and a range of extra content. This may include podcasts, webcasts, instructional materials, study guides, and so forth. Within such a model Print on Demand (POD) would also have a role to play.
More radically (in this market), one price that is being explored is that of zero. For zero, one might have access to a Creative Commons-licensed simple HTML version of the work, accessible online (in other words, not downloadable as a PDF or ePub file).Footnote 4 And, while it is possible to copy and paste from this version it is not as easy as a downloadable version—which one might charge for. This zero-priced version not only meets the ethical test that a monograph is equally available to all, but also serves as a powerful marketing channel as it will attract more readers who will indicate its value to libraries, colleagues and peers.
A Business Model for Managing Risk
However, even with new business models that might increase distribution, and thus sales, the problem of the risk of first copy costs remains. The big question is who will carry the cost of, and thereby effectively underwrite the risk of the first copy? Here, we describe an alternative model, based on a radical redistribution of roles and benefits among the current stakeholders.
The basic premise is simple, and based on aggregating demand in the form of a consortium and paying publishers for getting to first copy stage—the digital file. In exchange for underwriting this cost, the consortium would agree with the publisher that the content is made available on a Creative Commons Non-Commercial license. This model might be more sustainable because if a significantly larger number of libraries participate than are buying high priced monographs now, then the unit cost per library falls dramatically.
Here is how it might work: if, say 1,000 libraries paid into a fund that “bought” the non-commercial open access rights to a book that carried, for the sake of the arithmetic, a “getting to first copy” cost of $10,000, then each library would contribute $10.00. The average monograph today costs approximately $80.00. This would not only get libraries eight times as many titles online, it would be truly contributing to making knowledge accessible globally. If, say 5,000 libraries subscribed to the scheme (although we feel this is unlikely) the cost would be $2.00 a title, representing a 97.5% reduction on the current print or eBook price.
Libraries that required print copies would buy these from the publisher. Individuals who preferred to read the “long form publication” in print would also purchase copies. If the publisher wished to enhance the original book, then that too would be sold to individuals and libraries. Because the origination costs would not need to be amortized across the print copies, it is likely that the prices could be reduced, making the individual purchase of monographs more attractive to specialists.
The key issues and risks to be resolved, in order for this model to work, are the process for any decision-making about publishing (any model is likely to need some human intervention) and ensuring that performance is monitored and adjusted in the light of experience. The two aspects are related: both raise the issue of governance. Governance is perhaps the most significant challenge facing such a model, especially if it grows in scope and reach. However, it may well be resolvable: there are many complex consortia or collaborative organizations making decisions on a regular basis about more complex and risky matters than these.
The other major challenge facing such a consortium model is how to get it started in the first place: it requires some considerable realignment of both thinking and behavior among all stakeholders, and, in particular, shifts in the way libraries spend money on behalf of their institutions. The end-state is easier to envision and describe than the process of actually getting there, or at least doing so in an orderly fashion that provides some continuity between the old and the new. It is equally unclear who might provide the necessary stimulus and co-ordination to get the necessary organizational infrastructure in place: the resources required would be significant. Again, other such projects have been started and become sustainable.
Should barriers such as governance and foundation be overcome, there are many advantages to such a scheme: wider access to scholarly monographs in the humanities and social sciences; the probability that diversity will be improved as more works will be published; a more active, responsible role for the academy (and especially its library) in the publishing process; and a role for publishers that allows them to continue to participate in this market. There is a price to that participation, though: the role looks much more like a service, with its lower margins and emphasis on efficiency above all, than the current model. However, risk is reduced in this model, and it still provides publishers with an opportunity to generate revenue from value-added versions that would complement their revenues from service provision.
The greatest benefit, and the greatest need, would be a continuing, sustainable future for academic monographs.
Coda
The first of our models is already in use at Bloomsbury Academic Publishers, and we expect to be able to report on its progress in due course.
The consortium publishing model is more novel, but novel models need to be considered urgently if the academic monograph is to survive. It remains, as many have observed, essential to some important scholarly disciplines, and its loss would be a considerable blow to the development and communication of knowledge and ideas, as well as to publishing as an economic activity. We do not wish to sound alarmist, but it does seem to us that the monograph is in grave danger, and that its survival is unlikely if nothing changes with all the damage to research and scholarship that its disappearance implies. There are risks to all innovations, but the greatest risk of all is that of no innovation.
While this proposal is too modest to be called a Modest Proposal, we nevertheless hope it stimulates debate and would welcome comments and responses from the various stakeholder groups.
Notes
1. “First copy costs” are all the costs incurred before a book can be printed or made available as an ebook, and include author's costs, publishing selection, managing the peer review process, the cost of editing and proofing, and preparation such as design, typesetting and uploading to a website. As can be seen, these are not affected by changes in manufacturing or distribution.
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