Financial Realities — A New Analysis Suggests OA Will Have a Benign Effect on Publishers | The Scholarly Kitchen

"What if the Internet doesn’t disrupt scientific publishing, but merely leads to incremental changes in how it functions? What if there were a clear and strong practical link between achieving widespread open access (OA) and maintaining robust subscription businesses? What if a market containing both fresh young upstarts and strong incumbents thrived? And what if the large incumbents ultimately absorbed the upstarts? What if the trade-offs many have been portending between big:small, old:new, and open:closed actually were dependencies? A recent analysis of the scientific publishing marketplace focusing on the financial implications of OA policies and business practices presents these issues in between the lines, concluding that commercial publishers have weathered the storm and adapted to changes, making it unlikely OA would be much of a problem for them going forward, while suggesting that the ultimate solution to providing OA on a widespread and sustainable basis will depend upon a robust subscription market much like the one we have today. The analysis, by HSBC’s Global Research division, is thorough and interesting, even if they do get some things wrong when it comes to market awareness. HSBC’s analysts surveyed funders, not publishers or librarians or authors, in making their assessment of the marketplace, which likely skewed the results somewhat and obscured some issues.  Their rationale for focusing on funders is stated toward the beginning:  '. . . ultimately the Funders will foot the bill for Open Access and, although we regard it as improbably, the Funders also have the power to disintermediate the Publishers. In our view, this makes them the most important constituent in assessing the impact of Open Access on the publishers.'

This assessment is purely a short-term financial assessment, not a long-term market assessment, which would likely focus on scientists and users of the literature, not on the funders. I’ll discuss the implications of this limited view below. The report also does not list which funders were surveyed, and provides no details about the survey instrument or methodology.  The analysis focuses on two publishers — Informa and Elsevier — while taking into account broader market trends, as well. Overall, the financial calculations make sense ..."