Wednesday, January 7, 2015

How much money do journal publishers make? A lot

Many, including me, have written about who is making money in healthcare. Sure doctors do very well, but not as well as hospitals, hospital administrators, insurance companies and their corporate officers, drug companies, device manufacturers, and others.

Another lucrative area is medical journal publication, especially if you are the publisher. A researcher gets an idea, plans and carries out a study, writes a manuscript, and submits it to a journal. The research may have been funded by the government, i.e., you and me.

An associate editor or a member of the journal's editorial board looks at the manuscript, and if it is deemed worthy, it is sent out to two or more people in the same field for peer review. This process may be repeated for papers that require revision.

All of the players in the above scenario—the researchers, most of the editorial board members except maybe the editor, and the peer reviewers—are paid nothing for their work. Factor in that the cost of producing a journal has plummeted in the computer era.

How much money do journal publishers make? Here are some impressive numbers from an article that appeared on a French website called "Rue89." The figures are for the year 2011 and are in euros. They include revenue from all science publishing, not just medicine.



As you can see profit margins range from 32% to nearly 42%. Elsevier's profit of over €878 million converts to just over $1 billion.

To put that into perspective, the most recent figures for Apple Inc., arguably the most successful company in the world currently, show a profit margin of 20%.

The Rue89 piece was written as an exposé about the French government's having to pay Elsevier $172 million in subscription fees to access information generated by scientists who were funded by that same government.

But the French have nothing on us.

In his presidential address to the American Surgical Association, Dr. Layton F. Rikkers, editor emeritus of the Annals of Surgery said:

Nearly $10 billion is spent annually by [US] universities and governmental agencies for access to research findings that their scientists and clinicians give to publishers for free, that their faculty peer review for the alleged honor of doing so, and that are funded by taxpayer dollars and charitable trusts. It is unclear why library budgets continue to increase above the rate of inflation when nearly all the journals they now receive are delivered electronically in large packages from the few remaining consolidated publishing houses. Examples are Wolters Kluwer's Ovid and Elsevier’s Science Direct each of which contain hundreds of journal titles. Some individual journals not available within these large collections, such as Brain Research, can cost libraries more than $20,000 annually.

There are more than 9000 open access journals, and 3.5 new ones per day are setting up shop. Instead of charging for subscriptions, open access journals are free to the reader, but the authors must pay "processing costs." Many of these publications have exorbitant fees with little or no true peer review.

Before submitting any paper to an open access journal, authors should be sure they understand the fee structure and check Beall's list of predatory publishers, which has recently been updated and expanded.

Dr. Rikkers feels as I do that print journals will gradually disappear. Post-publication peer review is already gaining momentum through blogs and sites such as PubMed Commons and PubPeer. Even major journals like the BMJ have established rapid response systems for immediate feedback to authors.

The heady days of 40% profit margins may soon be over, but for now big bucks are being made.

More about journals:

How are journal articles peer-reviewed?
How journal articles are peer-reviewed: Part 2
Journals, Open Access Journals and More Journals
What you need to know about some open access journals




19 comments:

R said...

I think we'll be seeing rapid change caused by parties funding research stipulating how the products of he research are to be published. In the UK the Welcome Trust is requiring open access and more recently the Gates Foundation has made major announcements recently too. It's going to be increasingly difficult for traditional journal publishers if they don't adapt to an new normal that includes open access to both articles and data.

Skeptical Scalpel said...

R, I agree that those initiatives may help push things along. Thanks.

Josh Farkas said...

Impressive, I never imagined the sheer scope of the problem.

Shocking how scientists (ourselves included) continue to be taken advantage of by this system. We give our work away for free, then turn around and pay money to access it.

In the current age, publishing costs can be decreased to close to zero (via electronic publishing, PDFs, etc.). We need a way to disseminate information which is as well-respected as journals yet without enormous delays for peer review and paywalls.

I'm sure that scientists could figure it out, but we're probably too busy scurrying around trying to get our latest manuscript accepted somewhere.

Skeptical Scalpel said...

The reason I wrote this post is that I also had been unaware of the magnitude of the problem. I think it will solve itself within a few years as more researchers get tired of doing all the work for nothing.

Jeffrey Beall said...

This is old news, and it doesn't tell the whole story. In 2013, I documented that Hindawi's profit margin was higher than Elsevier's. See here: http://scholarlyoa.com/2013/04/04/hindawis-profits-are-larger-than-elseviers/ Faculty salaries have also gone up a lot, and this is part of why tuition is so expensive in the US, but of course no academic blogger is going to complain about that. Tell the whole story, tell the whole truth.

Skeptical Scalpel said...

Thank you for commenting. Jeffrey Beall is the creator of Beall's List. My post is old news to you, Jeffrey, but it's been viewed by almost 2000 people so far. Comments on Twitter also indicate that most people were unaware of this. I am impressed with Hindawi's 52% profit margin. I wish I had come across your post when I was researching the topic.

I recently received an email from another publisher asking me to organize a special issue. I declined, as should anyone who gets such a solicitation.

I'm not sure what faculty salaries have to do with this. Maybe they're rising so that faculty can pay their open access processing fees.

Anonymous said...

Thank you for this precious piece. It is apparent that some publishers will continue to exploit scientists to unjustly enrich by lobbying to make reviewing manuscripts a mandatory requirement to promotion, tenure and job security. It is not enough that academics have been struggling with the " publish or/and perish" mantra, it seems that from now on they will have to struggle with "review or screw you mantra"

frankbill said...

Coming from someone with a un Dx illness. The other side of this is many providers don't subscribe to many journals. So what others write never get read by the ones that need to read it the most.

Skeptical Scalpel said...

Anon, thanks. Are you aware of any documented attempts to force people to review manuscripts?

Frank, If you have access to a good online library like Ovid or Science Direct, you don't need to subscribe to any journals.

Anonymous said...

http://scholarlykitchen.sspnet.org/2015/01/08/peer-review-recognition-wanted/

Anonymous said...
This comment has been removed by a blog administrator.
frankbill said...

So how many providers read Ovid or Science direct?

From this link It looks like there is some limits to Ovid as to full text

If it appears, click on "Ovid Full Text" to go directly to full text from Journals@Ovid.

In Part
Use the "Get It" link to bring up a window that provides links to the full-text of the article, if available, links to the Library Catalog to check Dartmouth holdings, and a link to submit a request to DartDoc, Dartmouth's document delivery service.

http://www.dartmouth.edu/~library/biomed/guides/which_medline_chart.html

Skeptical Scalpel said...

Anon, thanks for the link. It's very pertinent to the discussion.

Frank, thanks for the info.

Henry Woo said...

Some of the smaller publishers probably make more relative to their turnover than the big guns. If you were to research the income made from reprints, it would make your readers very concerned. When for example, the NEJM publishes a big drug company sponsored trial, it has the potential to generate 6 or 7 figure fees for reprints. This data is of course kept confidential but it does create a potential conflict of interest for journals that tend to publish a lot of industry sponsored trials. Admittedly, on line access has probably seen a huge fall in reprint orders. Here are a couple of links that suggest the need for greater transparency in this nice little earner. http://www.bmj.com/content/344/bmj.e4212 and http://journals.plos.org/plosmedicine/article?id=10.1371/journal.pmed.1000354

I was also interested to see Jeffrey Beall chime in. I love following his blog although it deals with the so called predatory journals rather than the 'credible' guys as is the subject of your blog piece. It is not surprising to see the rise of predatory publishing companies -there is money to be made and there is no shortage of desperate or gullible academics.

My latest comment on predatory journals is here - (feel free to edit it out if you do not wish to publish this link) http://surgicalopinion.blogspot.com.au/2015/01/predatory-journals-academics-are-as.html

Skeptical Scalpel said...

Henry, thanks for the links. I wasn't aware of the money that journals make from reprints. It's a lot.

I too have been invited to serve on the boards of some shady journals. I've written about them in a couple of posts. http://skepticalscalpel.blogspot.com/2014/05/what-you-need-to-know-about-some-open.html and http://skepticalscalpel.blogspot.com/2011/10/journals-open-access-journals-and-more.html

Anonymous said...

I believe that academics ( especially deans and members of promotion and tenure committees) should not be allowed to serve editorial boards as they would advocate policies that benefit their journals

Skeptical Scalpel said...

Maybe, but editorial boards focus on content. Policies like pricing and not paying reviewers are generally decided by the publishers themselves.

Anonymous said...

Deans and committee members can advocate policies like acknowledging academics contributions to journals, they can also guide their institutions to pressure academics to provide gratuitous services to publishers.

Skeptical Scalpel said...

They certainly already acknowledge academics who contribute to journals. Publish or perish. I'm not sure they pressure people to review manuscripts, but that is something that is thought to be career enhancing.

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