0.6 Effects of online access on institutional subscriptions  (Page 4/5)

Assuming that a society covers its online publishing costs by sales to its core markets, it makes sense to assess the profitability of sales to any new markets taking into account only the incremental marketing, sales, and fulfillment costs of reaching those new subscribers. Otherwise, if a society were to consider all of its fixed first-copy costs in determining profitability, it might forgo additional revenue without reducing its actual operating costs. For a primer on these issues, see Dryburgh (2003).

This frees a society from the need to allocate fully loaded online costs across all its content offerings to all market segments. However, it does require that the society clearly define what constitutes its core markets, to which it will allocate shared costs, versus marginal markets, which would only bear the costs exclusive to themselves. This definition will be critical to the society’s ability to assess the relative attractiveness of various market offerings.

The core markets for many societies will comprise the society’s members and four-year college and university institutional libraries in mature markets (typically North America and Western Europe). These core markets (either separately or together) need to generate sufficient revenue to cover all of the society’s shared operating costs, including content creation and online distribution. Other markets—for example, two-year colleges, special libraries, museums, public libraries, and four-year institutional libraries in emerging or underserved markets—may then be treated as incremental, and their profitability may be evaluated taking into account only those costs incurred in reaching and serving those markets.

The above discussion of online cost allocation and marginal markets is also relevant to a society’s consideration of tiered pricing approaches, consortia sales, and participation in online aggregations, discussed in Chapter Five, “Consortia Sales and Aggregations.”

Less developed countries

Although it will not increase a journal’s revenue, a society might expand access to its journal by providing free or substantially discounted online access to less developed countries (LDCs). Publishers identify recipients of LDC free and discounted access using a variety of methods. Some publishers use schedules of countries developed by the World Bank, the United Nations, OECD, or other agencies; and others identify recipients based on existing programs (e.g., HINARI, AGORA, HighWire, etc.). Extending free access to libraries in the world’s poorest countries supports a society’s mission to advance knowledge in its field, while in most cases exposing the society to little or no revenue risk. Increasing access to journal content for research and teaching communities in LDCs will be especially important for societies representing disciplines engaged in cultural, historical, or scientific studies of such regions.

There may be a library-sponsored program designed to increase LDC access to online peer-reviewed journals in the society’s field. Such programs include HINARI (biomedical fields), (External Link) AGORA (agriculture), (External Link) OARE (environmental sciences), (External Link) and PERI (sciences, social sciences, and humanities). (External Link) . For a list of programs intended to deliver peer-reviewed journals to developing nations, see (External Link) .