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Excerpt from Library Journal Academic News Wire: July 03, 2003
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Peter Suber
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Jul 03, 2003 09:16 PDT
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Library Journal Academic Newswire (TM)
The Publishing Report for July 3, 2003
[...]
FOR CINVEN AND CANDOVER, A CASE OF BAD TIMING?
When ads touting scientific research as a public resource finally air,
scheduled for commercial breaks on THE SIMPSONS, will execs at British
firms Cinven and Candover be heard repeating Homer Simpson's famous catch
phrase: D'OH! In putting together its multi-billion dollar merger of Kluwer
Academic Publishers (KAP) and Springer Scientific, the firms are creating a
major STM publisher. But with open access initiatives, STM legislation
quickly ramping up, and the forthcoming public awareness campaign, one has
to wonder how this will affect the financial future of STM publishing.
Given the profits that firms such as Elsevier have posted over the past
decade, Cinven and Candover's strategy would seem like a shrewd business
move, despite the enormous price paid for Springer--over one billion Euros,
more than 10 times Springer's 2002 earnings. (In comparison, AOL/Time
Warner was unable to attract a bid even equal to its annual sales for its
trade publishing unit). While Cinven and Candover officials in announcing
the sale stressed that STM publishing has a solid financial performance
through good times and bad, recent strides in open access publishing
suggest the future may be shaping up differently.
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OPEN ACCESS WILL CHANGE STM, BUT HOW MUCH REMAINS TO BE SEEN
Since Cinven and Candover announced plans to create a major STM player,
years of talk in the library community has finally translated into action
as open access initiatives and alternative publishing models appear to have
reached critical mass. Consider this: Since Cinven and Candover's
acquisition of Springer and its plan to merge it with KAP, the U.K.'s Joint
Information Systems Committee has entered into a landmark institutional
deal with open access publisher Biomed Central (see LJ Academic Newswire
6/19/03). Under terms of that deal, all British researchers can now have
their publishing activities subsidized. Author fees are waived for British
scientists contributing to BioMed Central, and access to BioMed Central
journals is free. "That is an enormous deal," explains Peter Suber,
publisher of the popular Free Online Scholarship Newsletter. "The UK is
correct to see that [access to research] is a legitimate state interest and
that there is a government role in supporting open access." Further pushing
open access, the PLoS, which has garnered the support of more than 30,000
scientists worldwide, will debut its first open access journals this Fall,
as well as unveiling that public awareness campaign on popular television.
Perhaps most intriguing, late last week, Congressman Martin Sabo (D-Minn)
introduced a bill in the U.S. Congress that would put publicly funded
research in the public domain.
If that measure, or a similar one, succeeds, it could heavily impact
scientific publishers--and Cinven's and Candover's investment. How much,
however, is unclear. Suber is quick to point out that traditional journals
should, ideally, still have a role to play in an open access world. Harold
Varmus, the former NIH chief who introduced PubMed Central and is a
supporter of the PLoS, agrees. Varmus recently told reporters at the SAN
FRANCISCO CHRONICLE that the PLoS has no intention of putting journals like
NATURE out of business. As for Cinven and Candover, Suber says he doubts
that due diligence analysts at the firms overlooked the threat of open
access, nor would they have invested so heavily in an STM publishing
venture without giving it a great deal of thought. On the other hand, he
cites the JISC/BioMed Central deal and last year's British Office of Fair
Trading (OFT) report on Scholarly communication (See LJ Academic Newswire
9/12/02) as evidence that open access is clearly poised to change scholarly
communication. The OFT's study, Suber notes, expressly states that the U.K.
government declined to regulate STM publishing because of the promise of
open access ventures to fix STM publishing without government
intervention--something analysts would have seen and appraised. "Somebody
in England knows that open access is a threat," Suber says, but that does
not necessarily mean that Cinven and Candover have made a bad investment.
"Elsevier is making more profit than ever." Suber notes. "Even if change is
coming it may not be coming quickly, and it may not take much profit out of
STM publishing."
[...]
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