|
Faculty - Mergers and Acquisitions
Access to important scientific, technical, medical (STM), and legal research is threatened by the anticompetitive behavior of large commercial publishers who are controlling more and more of the academic publishing arena. Since 1997, at least five major commercial publishers of STM journals have been acquired by competitors, in addition to numerous mergers among smaller entities. Economic research shows that mergers among large publishers increase the prices of academic journals for consumers. In the biomedical field alone, significant price increases occurred in 10 of 11 mergers over the past decade. [1]
The Information Access Alliance, a coalition of seven library associations, argues for a more consumer-friendly definition of the STM journals and legal serials markets by taking into account the decision-making process used by libraries because the vast majority of revenue generated by publications of commercial STM and legal serials comes from libraries and institutions, not individuals.
Regulatory authorities should consider a number of important factors when analyzing proposed mergers of STM and legal publishers including the following:
- Access to a broad spectrum of research information is essential. Research contributes significantly to the overall health and wealth of our society. Public and private investment in research and development (R&D) in the U.S. topped $265 billion in 2000, accounting for 40% of the total global investment in R&D. Publication of research results assures not only a record of achievement, but, more importantly, ensures that current and future researchers will be able to build on this work. A 1998 study found that 73% of the articles cited in U.S. industrial patents resulted from publicly funded research projects. [2]
- Researchers read journals more than any other type of publication and find them essential to their work. Studies show that a typical scientist spends 11.7 hours per month surveying the literature, with cancer researchers spending about 24 hours per month. Researchers depend heavily on the library for access to journals. While individual scientists subscribe to an average of 2.7 journals, they obtain 64% of the journals they read through the library, in either print or electronic form. [3]
- Publisher mergers contribute to inflation in subscription prices. Subscription prices for research journals have been increasing well beyond the consumer price index for several decades. Research shows a very strong correlation between mergers and rates of inflation that are even higher than the general trend noted above. Over the past two decades, increased concentration in the publishing industry, along with significant escalation in the price of serial publications, has eroded the ability of libraries to provide faculty and researchers with needed publications.
- Traditional antitrust analysis of publisher mergers does not adequately account for consumer purchasing decisions. New criteria proposed by
the Information Access Alliance takes into account the unique purchasing practices
of the dominant purchaser of academic journals: academic and research libraries
and institutions. These new criteria are based in a strong economic argument
that demonstrates the harm caused when the wrong standard is used to analyze
mergers.
Learn More
Information Access Alliance
A coalition of seven library associations that argues for a more consumer-friendly definition of the STM journals and legal serials markets. The site contains links to a number of studies and background documents.
Publisher Mergers: A Consumer-Based Approach to Antitrust Analysis
Thomas M. Susman & David J. Carter. A white paper commissioned by the Information Access Alliance, this publication outlines the issues very clearly and is easily understood by those of us without backgrounds in law or economics. Section 2: "Access to a Broad Spectrum of Research Information is Essential" contains many examples of how wide dissemination of research results leads to scientific innovation, medical advances, improvements in public health, and the sustenance of our legal system. These examples help advocates construct powerful and compelling stories.
Mary M. Case, "Information Access Alliance: Challenging Anticompetitive Behavior in Academic Publishing" C&RL News 65, no.6 (June 2004):310-313, 326.
The Academic Publishing Industry: A Story of Merger and Acquisition
This site profiles twelve large European and North American publishers. The timelines are the most interesting feature, tracking the firms' struggles to find a steady, but profitable niche for their publication efforts. The mergers and acquisitions as well as the sales strategies are clearly attempts to find niche markets for the publishing activities of the companies. Created by Mary H. Munroe, Associate Dean for Collections & Technical Services, Northern Illinois University Library.
Can Antitrust Save Academic Publishing?
Albert A. Foer, President, The American Antitrust Institute, (July 2004).
Mark J. McCabe, "Law Serials Pricing and Mergers: A Portfolio Approach" Contributions to Economic Analysis & Policy 3, no.1, article 11, 2004.
Mark J. McCabe, "Journal Pricing and Mergers: A Portfolio Approach". The American Economic Review 92, no.1, (March 2002):259-269.
Mark J. McCabe, "The Impact of Publisher Mergers on Journal Prices: An Update" ARL No. 207, (December 1999).
Michael A. Stoller, Robert Christopherson, and Michael Miranda, "The Economics of Professional Journal Pricing" College & Research Libraries 57(January 1996):7-21.
Footnotes:
- Mark J. McCabe, "Journal Pricing and Mergers: A Portfolio Approach," The American Economic Review 92, no.1, (March 2002):265-67.
- Carol Tenopir and Donald W. King, "Toward Electronic Serials", Special Libraries Association, Washington, D.C. 2000, p. 159-75; and Education for Change Ltd., SIRU, University of Brighton, and The Research Partnership, "Researchers Use of Libraries and other Information Sources: Current Patterns and Future Trends," Higher Education Funding Council for English, 2003, p. 20-21.
- Elisa Eiseman, Kei Koizumi, and Donna Fossum, "Federal Investment in R&D", Rand Science and Technology Policy Institute, Project Memorandum PM-1336-OSTP, Arlington, VA, (July 2002):15.
|