January 9, 2007

Back Issue Digitization Projects (BIDPs): Accessing the Whole Megillah

Several publishers already recognize that the most promising buyers of electronic versions of their back issues are institutional in nature, and those institutions will most likely be libraries. Driven by the needs of their patrons, public, academic, corporate, and even secondary school libraries "channel" research by raising the visibility of sources that the World Wide Web and search engines effectively flatten. Libraries are more than mere customers; they are promoters. They operate as a market for intellectual goods and as a partner for the redistribution of those goods, which can benefit publishers seeking to monetize their back issues.

Take the example of JSTOR, which has successfully capitalized on the research needs of library patrons by recognizing them long before the publishers whose content it has digitized. Seeded by money from the Andrew W. Mellon Foundation, JSTOR’s mission was to preserve and disseminate in digital form those academic serials, particularly in the arts, humanities, and social sciences, whose publishers lacked the fiscal wherewithal, vision, or interest to support a BIDP. For these publishers, JSTOR provided an enormous service in salvaging their journals. However, JSTOR is a third-party distributor. This means that in exchange for bearing the cost of digitization, it pays royalties based on "usage," which can decline over time into a fairly limited revenue stream. (I will blog "usage royalty" arrangements another day to explain how they work). While publishers managed to shed the risk of investment in a BIDP, they may have given up greater returns to their top and bottom lines as a consequence.

JSTOR's role as a third-party distributor is not unique. The variety and subtlety of its pricing models is. Instead of tiering its costs solely by FTEs or materials acquisition budgets, it cannily drew on specialized or weighted systems to classify customers. This modeling process started with JSTOR's use of the Carnegie Classification scheme for academic libraries (its main market). This tiered system offered a new way to calibrate and target an academic library's level of interest in the kinds of publications JSTOR featured. Since then JSTOR has tailored its pricing for community colleges, public libraries, secondary schools and museums in order to make its product offerings more responsive to the subscriber's mission and sensitive to its fiscal ability. For community colleges, it uses the "Associate of Arts" designation in the Carnegie Classification scheme; for public libraries, it balances sizes of populations served, materials budgets, and numbers of active serial subscriptions; for secondary schools, it divides them into three classes according to their "college-enrolling rate"; and finally for museums, it weighs operating budgets, material acquisition budgets, numbers of active serial subscriptions and numbers of FTE curators and librarians.

A number of JSTOR’s targeted publishers, some belatedly recognizing the success of this business model, have jumped into the market with their own offerings, a list of which appears on the website of the American Association of University Presses. These include the University of California Press’s CALIBER, Cornell University’s EUCLID, and Duke University Journals Online. (One of the few early entrants prior to JSTOR was Johns Hopkins University Press's Project Muse.) Moreover, even though BIDP offerings may end up spotty (e.g., incomplete), more publishers have begun to recognize the value of the staking their own claim instead of collecting royalties that can range from middling to marginal from third-party distributors.

Up until the last few years, online serial products, including those with relatively long backfiles, have been supported through subscription models. More recently, however, publishers have begun to explore the outright sale of back issues. Take the case of Sage Publishing, which not only offers subscriptions to its backfiles but permits institutions to purchase them outright. What is unusual about Sage's model is the way in which it pitches its offering. Third-party distributors typically provide serial subscriptions (and sometimes even "archival purchases") prepackaged by topic (e.g., religion, science, health) or target audience. (e.g., high school student, college student, academic researcher). Aggregators like Gale, EBSCO, ProQuest, JSTOR and sundry others all offer packages like this. Sage, however, has taken the unusual step of allowing customers to purchase individual title backfiles. Alas, it is not clear if this purchase is in lieu of or in addition to a subscription. As technology continues to permit microtargeted customization, it may be a matter of time before prefab packages becomes themselves a thing of the past for serial subscribers/buyers.

In the meantime, the economics of subscriptions and archival purchases represent two different business models. Each has its respective risks and benefits. Archival purchases feature higher price tags because the transaction is structured as an outright “buy” of the content. The customer obtains ownership rights to the content, which obliges the publisher or distributor to ship copies of the digital files to the customer on a hard medium storage device (e.g., USB hard drive) for offline storage or create a “dark archive” with a trusted third party (such as the Library of Congress). In the end, this transfer permits customers to locally load, host, and disseminate the data from its own or contracted servers in the event of the product’s discontinuation by the publisher. Unlike electronic subscriptions, should the product go away, the customer is left with something more than a mere history of access.

For publishers, archival purchases can offer a more aggressive return on the investment, but the publisher or distributor will still have hosting and access management obligations. These are currently recouped through “access fees.” For libraries, archival purchases offer two benefits: one is ownership of the content, something that online subscriptions simply do not permit (lease-to-buy options are rare because of the accounting nightmares for publishers); two is the ability for librarians to use discretionary portions of their materials acquisition budgets instead of their typically stressed and often preallocated serials acquisition budget. The downside for libraries (and therefore publishers) is the growing resistance to access fees as they accumulate within a library’s budget.

Fee accumulation and unique interfaces for each offering create special resistance to backfile products that comprise a single or just a few titles that had modest circulation at best. Major titles stand a better chance, even as one-offs. Best are large sets of titles, like those available from Sage, Elsevier, OVID, and others that assemble many titles in one place for institutional consumption.

Bennett Lovett-Graff
Publisher, Content Solutions
National Archive Publishing Company
Digitization, Microfilming, and Publisher Services

January 8, 2007

Back Issue Digitization Projects (BIDPs) by the Pound: Article and Issue Business Models

As I've described in a previous post on business models for back issue digitization projects (BIDPs), serial publishers have begun to explore a variety of ways to monetize their backfiles. One such way is to sell their content "by the pound," if you will.

There are several by-the-pound scenarios. While institutional subscriptions to the New York Times are available to public, academic, and public library patrons through ProQuest, individual consumers with no particular affiliation who may wish to have immediate access and ready ability to view, download, or print have not necessarily proven averse to hunting down and plunking down hard cash for individual articles. Consider the pre-1981 portion of the New York Times, which uses ProQuest's Archiver service to permit users to purchase individual New York Times articles. Alas, there are limits on what is available owing to copyright or cost. As outlined in the New York Times's helpful FAQs on what customers can and cannot purchase, photographs, display ads and classified cannot be had. But even with this limitation, the service plays an important role for researchers.

As a newspaper, The New York Times throws additional curveballs. Newspapers tend to be complicated animals, with their complicated layouts and many intended audiences. Periodical publications feature simpler designs because of their narrower publishing objectives and audience. This also makes them easier to digitize and sell in electronic form. Several magazines have recognized that reality. The Atlantic Monthly offers a good example through its creative pricing for electronic backfile access. The publisher here capitalized on the flexibility of the ProQuest Archiver to not only sell by the pound but supply volume discounts through a "pass" system for those who want to buy in bulk.

Then there are the many other publishers who have opted for simpler "go-it-alone" arrangements. Instead of using a pre-packaged (albeit dexterous) service like ProQuest Archiver, some monetize their backfiles by loading tables of contents at the issue level and introducing basic shopping cart software for straightforward per article purchasing. The American Institute of Aeronautics and Astronautics publishes nine journals. Its flagship journal, the AIAA Journal, lets users touch down in the table of contents of each volume. Users gain access to the first page (this one is from the first article in volume 3, 1965) before being prompted onwards to purchase the full article by clicking the "Add to Cart" button. (Articles seem headily priced at $25.00 per item, although for science, technology and medicine publications, this is not unusual.) AIAA members are, of course, encouraged to include their membership identification number to receive discounts. For subscription-based (instead of membership-based) publications, a current subscriber account number might serve just as well for that discounted access to articles from the periodical's backfile.

A variant on paying per article is "paying per view." The difference is more semantic than actual. Pay-per-view arrangements are just more forward about the time limits they impose on access. Science exemplifies this approach. As perhaps the premiere publication in its area, Science has aggressively relaunched itself in the digital arena. Its fully digital backfile is automatically available 24/7 to all dues-paying members of the American Association for the Advancement of Science. This arrangement has the salutary effect of transforming the backfile into a membership drive-and-retention tool. For nonmembers, access is a more highly restricted and therefore more expensive affair. Not only must nonmembers pay for access to an article, but Science imposes a 24-hour use-it-or-lose-it time limit per article, presumably in order to manage IP address traffic. Still, the ability to read, print and download is there, little different from other BIDPs on the market.

Finally, there is the option of acquiring the entire issue itself. There are certain inherent advantages to this mode of delivery through distributors like Zinio, especially for popular magazines that both want to defend their copyright and defend themselves from intellectual property violations of their own making. Zinio adopts a newsstand sales model. Subscribers purchase digital versions of the complete back issues at prices that differ little from print back orders. What customers receive is online access to full-color high-resolution JPEGs of the original work. Zinio's presentation does not permit text searching, a weakness for users who demand that form of retrieval. Nonetheless it does curtail infringement by webcrawling software engines that scrape the Web (not a small point in light of Google's recent court victory) or individuals who resort to something as simple as blocking out, copying and pasting text from HTML or PDF files. (Of course, JPEGs, GIFs, PNGs and other formats can be outfitted with "hit-term highlighting," which simultaneously allows full-text searching and prevents Web scraping, but that's another story.) Moreover, Zinio's presentation helps overcome the Tasini court ruling that pinched periodical aggregators and publishers who sought to remarket their content in a "disintermediated" form (e.g., articles and images separated from one another). By keeping the entire issue intact, Zinio follows Tasini's allowance to reproduce content without reacquiring rights from authors, illustrators or photographers. As such, Zinio is an ideal, although limited, tool for publishers seeking to protect their content and meet intellectual property requirements that might otherwise prevent them from making their content available for electronic consumption.

Bennett Lovett-Graff
Publisher, Content Solutions
National Archive Publishing Company
Digitization, Microfilming, and Publisher Services

Back Issue Digitization Projects (BIDPs)

Untily recently, publishers who haven't digitized back issues of their publications, back issue digitization projects (BIDPs) have seemed more than little more than a royal headache with an uncertain return on the investment. More often than not, too many publishers operate in relative ignorance of their digital options and even their monetization opportunities. There are a number of options respecting BIDP standards, implementation platforms, and markets, so it hardly comes as a surprise that publishers, not knowing how to proceed, just pass on the opportunity altogether.

Presently, tens of thousands of periodicals are electronically available on websites either directly from their publishers or, more commonly, periodical aggregators. For the latter, who often take on the responsibility for digitization, most of these publications only go back in electronic form from five years to three decades, when such aggregators (e.g., LexisNexis or Dialog) first came came on the scene.

Since then several established publishers (Elsevier) and more recent aggregators (JSTOR) have aggressively engaged in BIDPs--defined here as projects that encompass runs of journals from their first issues to the most current--of either their own or others' content. Yet despite these more recent ventures, large swaths of copyrighted back issues go undigitized, breathing artificial life into back issue distributors (PastPaper.com or MillionMagazines.com) and giving succor to Google-like initiatives to digitize and freely distribute copyrighted but unlikely-to-be-defended serial publications (either because "orphaned" by defunct publishers or neglected by extant ones), unless actively stopped. The growing pressure to digitize and distribute everything, a trend that Google's library partnerships epitomizes, represents a very real threat to publishers who opt not to explore aggressively ways to monetize BIDPs of their own content. Consider the case of a project I worked on from Wolter Kluwer's Ovid, which rushed through this 4 million-page BIDP project in some 6 months (with content sourced from library partners), resulting in a $50K/sale product that saw a near immediate ROI.

The questions surrounding page imaging, text capture, display, hosting, platforms, maintenance, billing, and customer service are legion--and the answers are inevitably driven by cost, specifications, capacity and customer expectation. While infinite electronic ink can be spilled on all of these issues, none of these much matter without a business model and target market to support the BIDP business case. A number of publishers and distributors have since begun the process of creating these models (with more to come). These models include the sale of individual articles or articles at volume discount to individual consumers; entire individual issues in electronic form to consumers; annual subscriptions to complete backfiles of the journal(s) to consumers or libraries; entire archival backfiles (most often to institutional purchasers).

To get a better sense of how publishers have been selling by the pound or the entire animal, see my respective articles on article/issue-based and entire backfile business models.

Bennett Lovett-Graff
Publisher, Content Solutions
National Archive Publishing Company
Digitization, Microfilming, and Publisher Services