0.6 Effects of online access on institutional subscriptions

Online access and print substitution

As institutional subscription revenue represents the largest income source for most peer-reviewed journals, a society needs to assess the effect an online edition will have on its base of institutional subscribers. The fundamental issues in this respect are the value and utility of an online version relative to the print edition, and the extent to which the online journal provides a viable substitute for, or improvement over, the print edition. Understanding how institutional subscribers perceive the relative value of the online and print editions is critical to a society establishing appropriate pricing for each medium, whether they are sold in combination or separately.

For institutional libraries to cancel a corresponding print subscription, the online version must typically provide the following:

• Immediate access—the online version must be available immediately, without an embargo period.
• Reliable and perpetual access—the online version must provide for ongoing access to the content (typically through a perpetual rights clause in the license agreement) in the event of cancellation. Further, in the context of multiple-title aggregations, there must be little or no perceived volatility in the aggregation’s content or title list.
• Completeness—the online version must contain all the substantive content of the print version, including all articles, reviews, editorials, letters, and other front and back matter.

How a journal is distributed online will also determine the effect on its institutional print subscription base. There are several common online distribution channels:

• Online distribution on a single-title basis. Assuming that an online edition meets the content criteria—immediate, perpetual, and complete access—outlined above, access to the journal on a single-title basis will typically provide a ready substitute for the print edition of the journal. This is true whether the journal is available directly from the society or from a third-party distributor.
• Access to the journal through an online aggregation that provides a viable substitute for the primary journal. For a discussion of substitution in the context of content aggregations, see Cox (2004). A subject-specific aggregation (again, that meets the content criteria above) offering multiple titles for a bundled subscription price will typically serve as a viable substitute for the primary journal. Participation in such an aggregation will not typically generate as much royalty revenue per institutional subscriber as the journal could earn through single-title sales. However, participation in such aggregations can make a journal attractive to institutions unable to justify a subscription to the primary journal. Cox (2004), 5. Further, participating in an aggregation may increase a journal’s overall revenue if the aggregation reaches into under-penetrated markets and generates revenue sufficient to compensate for any cannibalized subscriptions in the journal’s core market. Whether participating in an aggregation will generate the same level of revenue as single-title access will often depend on the aggregation’s penetration of unserved or underserved markets and/or the ability to preclude access to the aggregation in the journal’s core market. On pricing for aggregations and consortia sales, see “Consortia Sales and Aggregations,” in Chapter Five.
• Access to the journal via an online aggregation that is not perceived, by purchasing librarians, as a viable substitute for the primary journal. Such aggregations can include large, multiple-subject journal aggregations, such as those available from EBSCO, ProQuest, Wilson, OCLC, and other vendors. Often the journals in these aggregations are embargoed (typically, for at least one year) or their content is incomplete (for example, only research articles are included). Equally important, even when journals are not embargoed or otherwise limited, the aggregation’s content is unstable (or perceived to be so) over time. Although such aggregations will not typically provide a viable substitute for institutions with a high demand for a journal, they may serve as a substitute for institutions at the margins of the journal’s market. Further, under sufficient budget pressure, libraries may simply have no choice but to downgrade from a discrete subscription to access via an aggregation.
• Pay-per-View (PpV) access to individual journal articles. Individual article purchase options may affect a journal’s subscription base at the margins—that is, for institutions with a tenuous demand for the journal. Individual article prices need to be set high enough to minimize their attraction as an alternative to a subscription, but low enough to generate new revenue.