#FSSC: Are publisher profits justifiable? | Publishing blog | Royal Society

"It’s widely recognised that the established scholarly publishers skim an awful lot of money off the top of research budgets. The Big Four (Elsevier, Springer, Wiley, Informa) all have profit margins in the range 32–42%. For Elsevier alone, a 38.9% profit on revenue of £2126M (page 17 of their own 2013 annual report) represents £826M diverted away from research – a figure more than sixteen times the £50M that the Finch Report estimated as the annual cost of transition to an all-open-access ecosystem. Elsevier representatives will point out in their defence that some open-access publishers have even higher profit-margins: for example Hindawi’s founder claimed in a 2012 interview a net profit of $3.3M on revenue of $6.3M for the first half of 2012 – a profit of 52.4%. Even PLOS, an avowedly non-profit organisation, runs at an operating surplus of 27% (expenses of $37M against revenue of $50.8M according to their 2013 report). Can this be justified? I have three thoughts ..."