What if someone built a marketplace for purchasing publishing rights to articles rather than reading articles?

This post started as a response to Ian Mulvany’s post, Are scholarly publishers technology companies?, but I got distracted by reading about the launch of PubSure, “the first two-sided marketplace connecting authors and journals” and meandered off into some serious navel-gazing about how APCs and transformative agreements might change the power dynamics of publishing which could lead to some interesting and potentially lucrative new technology services. 

The current scholarly publishing marketplace

Ian noted (paraphrasing things a bit) that publishers acquire articles by developing  relationships with communities of authors who then choose to publish their work in the Publisher’s journals. This process is brilliantly satirized by Jorge Cham in this cartoon. That Publisher’s “don’t think about “acquiring content” through purchase” is one of the reasons why scholarly publishing is such an attractive and profitable market. Thinking strategically, a basic five forces analysis for most publishers is going to look something like this:

The power of competitive rivals is fairly low because of the oligopoly nature of publishing, the threat of new market entrants is moderate but given the increasing rate of publication new entrants are easily accommodated, the bargaining power of suppliers (authors of papers) is very low because prestige and impact factor dynamics reduce choice of publication venue, the non-substitutable nature of journal articles means that the bargaining power of customers (subscribing Institutions) is relatively low, and there are relatively few substitute products for research papers. As a consequence, profit margins are high.  

What if Institutions built a new scholarly publishing marketplace?

The PubSure platform, which creates a marketplace for editors to select papers, is firmly rooted in the current power dynamics of scholarly publishing. However, pay to publish deals have the potential to disrupt the relationship between authors and Publishers. What if, instead of Institutions being fairly passive purchasers of content they became powerful intermediaries who could call the shots about what gets published where, and for how much? A revised five forces analysis could look like this:

In this model, the bargaining power of suppliers (Institutions representing authors) is very high because they control the supply of articles and the minimum service level they are willing to sell them for. The bargaining power of customers (Institutions buying bulk publishing packages) is very high - an Institution can refuse to pay for some publisher’s services if they fail to provide sufficient value. The power of competitive rivals is very high because publishers have to compete on services to get the best papers. The threat of new market entrants is low because competition is fierce and the cost of add-on services means low profit margins.  If power shifts from Publishers to Institutions a new set of opportunities/problems will be created many of which lend themselves to new technical solutions.  

New problems and new solutions

One of the more interesting problems to think about in a pay to publish world is how individual Institutions or Consortia will manage the allocation of millions of pounds of APCs. It’s extremely unlikely the funds available will cover all the publication costs for all researchers at an Institution so APC administrators will face a tough portfolio optimization problem. 

Solving this problem via a ‘first come first served’ system would be easy to administer but what happens if it’s May and the Institution can’t fund a potentially Noble prize winning paper because they funded 300 papers by PhD students in November? Does the author have to payAlgorithmic solutions would take time to develop and could be hugely biased against women, minorities, emerging fields, etc. Strategic buckets could be used to help allocate funds based on an Institution's strategic priorities. A panel of experts could be set up to oversee the allocation of funds but the process would likely be slow and complex and need an appeals procedure.  Alternatively, you could let the market decide. A marketplace for publishing articles, rather than the often touted but never developed iTunes for the consumption of articles, is a fascinating future scenario to explore. 

What might an Institutionally administered marketplace for papers look like?

Imagine it’s 2030, you’re a researcher working at a big research institution and want to publish a paper. Sadly, your research grant doesn’t cover publication so you have to brave your Institution's article marketplace. The article marketplace is run by a Consortia of Institutions whose aim is to optimize the impact of their Institution’s research. You start the process by placing a preprint of your paper onto your Institution's article marketplace, you indicate where you would like your paper published and then keep your fingers crossed that your Institution gets you a good deal because your involvement in the acceptance process has now ended. 

Publishers are invited to bid on the papers they would like to publish in a Dutch auction. The bidding is by invitation only so predatory publishers and any publisher the Consortia doesn’t like are excluded from bidding. For the ‘best’ papers bidding between publishers is fast and fierce and happens over a 7 days. Publishers can increase their chances of winning the paper by  offering a range of additional services designed to deliver impact such as a feature in a quality newspaper’s Sunday supplement, a guaranteed amount of usage, a podcast with the author, X amount of PPC advertising on Google or 10,000 promotional adverts on the publisher’s network. For some papers, cc-by licences will be chosen over cc-by-nc to allow the Publisher and Institution to share reprint revenues. For most papers the Publishers will offer Institutions a standard publication package. The Consortia keep track of a range of impact metrics to monitor Publisher, Institution and Author performance. Some papers never find a buyer or the Institution runs out of money to cover APCs so these papers are published in the Institution’s own journal (but no author wants their paper to end up there). 

A question that could drive strategy

Returning to Ian’s blog post, “in an environment where national pay to publish deals look like the smart money for the future of economic flows in our industry” what are the questions that should drive strategy? One question I would ask is how can a publisher take advantage of the new blue oceans that these deals create. I would take a very hard look at the problem of allocating APCs and think about solutions that could help Institutions manage this process. A clever Publisher with a suitable, publisher agnostic technical solution, might be able to insert themselves into this new value chain.  A market driven model for the allocation of APCs is probably the least likely to be adopted but even an expert panel is going to require some kind of technical support to manage the flow of papers through the system and probably some kind of kind algorithmic support to help predict the papers likely to deliver the most value/impact to the Institution.