The great publishing swindle: the high price of academic knowledge

“One of the great outrages of academia in the modern age is the privatisation of the profits accruing to publicly-financed knowledge. Some light was shed on this outrage recently with an article published in the conservative Economist magazine. It called the academic journal business ‘a licence to print money’, on the basis of the enormous profits that industry makes from providing licenses to access its depository of journals. The article noted that an annual subscription to a chemistry journal costs $US20,269, while a mathematics journal costs $US20,100. The largest academic journal firm, Elsevier, made a staggering profit margin of 37% in 2011, up from 36% in 2010. This resulted in profits of £768 million from revenue of £2.1 billion. Clearly, in terms of market returns, there is something seriously wrong with the way this industry operates, indicating excess levels of non-competitive profits. The problem, however, is obvious to see. Academic journals, as with much of today’s R&D outputs and creative art, are protected by a medieval government monopoly created during the time of the feudal guilds: copyright. This is one of the elements of the umbrella known as intellectual property rights (IPRs), or as should be more accurately termed, intellectual monopoly privileges (IMPs). The latter terminology stems from the recognition that IMPs are a privilege granted by the state to some favoured party, in this case, the private sector. IMPs restrict everyone except the license holder (and authorised parties) from creating and distributing copies of the protected item, thus bestowing a monopoly to the holder. Previously, universities provided subsidies to cover the cost of producing journals, but defunding, combined with incentives to relinquish journals to for-profit firms, has seen industry acquire the vast majority of market share... One would think that considering that the scientific knowledge embodied in journals is a public good, produced within a university sector subsidised by taxpayers, edited and reviewed without charge, and can be reproduced at zero cost electronically on the internet, they should either be made available for free and/or for a nominal charge to cover the cost of printing. Clearly, the opposite has occurred. Tens of thousands of academic journals are owned by a handful of corporations that set onerous terms for licensing. The worst, of course, is the monopolistic pricing. Bundling is another perverse practice... The arguments for the privatisation of journals are flimsy at best. Perhaps some may say that journals need to be privately owned (courtesy of government intervention) to ensure innovation and creation of new market niches and that business and technical expertise are lacking within universities. The real innovation in this context, however, is the content, not the method of delivery. Printing hardcopy journals has existed for ages and can be carried out by publishers, whether in the public or private sectors. Creating electronic copies to be put on the internet is hardly innovative.After all, universities are the locus of innovation in our economy, and have a veritable army of business, management and IT academics and specialists who can help provide the necessary expertise. Many universities already have their own book publishing presses, so it is a minor step to include journal publishing... Accordingly, a system of public financing should be set up to pay a lump sum to all authors who have a paper accepted in a journal, and perhaps a small prize fund to provide rewards to those who have authored scientifically important and/or popular papers. Editors and reviewers should be paid the prevailing market wage for their work, along with those who publish the journals, whether in print or electronically online. Instead of having to access journals online through a myriad of security features, they should be made available for anyone to access and make copies if they so wish... It is quite possible that with the aggregate amount of money that Australian universities and other institutions spend every year on financing access to privately-owned journals, it could be used to finance a far more efficient system of journal production – rewarding authors, reviewers, editors, and publishers, without gouging consumers and end-users, while promoting a more effective dissemination of scientific knowledge.”