Publishing Science, An Extremely Profitable Marketing System

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In 2010, the profit for Elsevier, one of the world' leading publishers of technical, medical and scientific information, was 36 percent of its revenue – which exceeded Google's, Apple's and Amazon's. How did Elsevier do it? The company made use of a simple business model developed by Robert Maxwell.  

 

 

 

 

Do you know Conway’s law?  “Any organization that designs a system (defined broadly) will produce a design whose structure is a copy of the organization's communication structure.” Simply put, our design reflects how we act and communicate. I mention this because publishing of scientific articles continues to be roiled by concerns about reproducibility, bias, delays in publication, etc. An article in The Guardian, Is the staggeringly profitable business of scientific publishing bad for science, tells the origin story of today’s publishing industry and by applying Conway’s Law provides clues to the sources of the problems. I have abstracted a few salient points, but I encourage you to read the article.

Elsevier’s profit in 2010 was 36% of its revenue, greater than Google, Apple or Amazon that year using the following business model:

“Scientists create work under their own direction – funded largely by governments – and give it to publishers for free; the publisher pays scientific editors who judge whether the work is worth publishing and check its grammar, but the bulk of the editorial burden – checking the scientific validity and evaluating the experiments, a process known as peer review – is done by working scientists on a volunteer basis. The publishers then sell the product back to government-funded institutional and university libraries, to be read by scientists – who, in a collective sense, created the product in the first place.”

Science at the end of World War II had changed, it had a new patron with deep pockets, the government. Not just the military, but governmental institutions like the National Institute of Health and a rapidly expanding university system educating soldiers returning to civilian life. Journals, often an afterthought, published by the few traditional scientific societies, were inadequate in communicating new findings. The British government brought the expertise of now vanquished German publisher Springer to British science publishing in the form of Robert Maxwell.  Maxwell, in turn, brought a business model to the table,

“All he needed to do was to convince a prominent academic that their particular field required a new journal to showcase it properly, and install that person at the helm of it. … [Maxwell] would then begin selling subscriptions to university libraries, which suddenly had a lot of government money to spend.”

And a realization; that each scientific article is unique, there is no substitution. A new journal does not replace another; it supplements the first. In a world funded by the government or universities (in turn funded by the government) a new journal was added to the library purchases. The more journals, the more money, at least to the publishers. In exchange, science’s new partner expanded access, sped up publication, packaged the materials more stylishly – they made the process seamless for scientists. Publishers competed for ‘named’ journal editors to make their journals more competitive and no one did this better than Maxwell who brought money and glamor to what had been somewhat dull, “low-ceilinged affairs.” Another factor in the post-WWII world was a belief in collective, collaborative action - the impetus behind the United Nations.  “Collaborating and getting your work seen on the international stage was becoming a new form of prestige for researchers, and in many cases Maxwell had the market cornered …”

Ben Lewin, a biologist from MIT, more fully exploited the market Maxwell had created. As editor of a new journal, Cell, he favored long-form papers detailing years of research on ‘big’ questions. He created a sought after journal of significant work and ideas, “Lewin was clever. He realized scientists are very vain, and wanted to be part of this selective members club; Cell was ‘it’, and you had to get your paper in there,” Where you published became important, not just in making your scientific name, but in building your career. Some journals had more ‘impact’ than others and were weighted differently by tenure committees. A scientist’s audience subtly shifted from their peers to their peers and the editors of high impact journals, like Cell or Nature.

As with all fields of business, the expansion of Maxwell’s time was followed by consolidation, and no one was better than Elsevier, with “more than 1,000 scientific journals, making it by far the largest scientific publisher in the world.” Elsevier’s management was smart, and ultimately took a page from the movie distributors of the 30’s – they bundled their journals. Just like the neighborhood movie theater that got the best movie along with two or three B films, Elsevier provided the most prestigious journals in a package with many of their other products, buy one get all. Once the universities bought into this grand bargain, the price of the deal began to rise, and the librarians discovered its Faustian nature. Pay the increasingly expensive charges for journal access or have large portions of the library disappear. “Librarians were locked into a series of thousands of tiny monopolies. There were now more than a million scientific articles being published a year, and they had to buy all of them at whatever price the publishers wanted.” Maxwell had been correct about the substitution of one journal for another.

Our competitive markets, our system of tenure and promotion, our human nature to enjoy accolades and feeling special, all of these have impacted our current system of scientific communication. This is Conway’s Law writ large, the flow of scientific information is now a complex system accommodating “the utopian ideals of science with the commercial goals of the publishers that dominate it.”

“The scientific article has essentially become the only way science is systematically represented in the world. … It is the primary resource of our most respected realm of expertise. … If you control access to the scientific literature, it is, to all intents and purposes, like controlling science.”

Dismantling and repurposing scientific communication will be no easier than understanding and controlling drug costs. Mandating free access by government funders is a step in the right direction, but a company with a 36% profit on revenues will not give up control easily.