On the face of it, patron-driven acquisitions (PDA) would appear to be a wholly negative innovation from a publisher’s point of view. Heretofore, libraries have purchased books just in case they were needed, but with PDA, the purchases are made just in time — on demand. This means that some books are never purchased and that those that are purchased may not be purchased immediately after publication, since a patron’s request may take place years after the date of publication.
Let’s work through the financial impact of PDA. I will restrict my remarks to the university press sector, though much of what I am asserting here is true for all book publishers.
Before we can estimate the impact of PDA on book publishers, we have to have some idea of what the baseline revenues are now. This brings us to the much disputed question of how many books university presses (or any publisher, for that matter) sell to academic libraries. I have discussed this question on the Kitchen before, and won’t repeat here all the reasons that determining sales to libraries is guesswork. My guess: library sales for university press titles come to 25% of the presses’ total volume. That’s 25% of $320 million, or $80 million. The figure of $320 million is an extrapolation based on AAUP figures, the 25% figure is a consensus number derived from countless conversations with university press staff and representatives of the book supply chain. The thing to bear in mind is that since the presses are not identical to one another, average figures can distort the measurement of presses that are outliers in some respects. For example, a press with a large trade program will have a lower percentage of library sales than a press with no trade program, which would be more dependent on library sales. The diversity among the presses means that PDA will affect them unequally.
If libraries were all to move to across-the-board PDA programs and no patrons requested titles, then the sales of the presses would decline by about $80 million, the amount currently being sold to libraries each year. But, (a) few if any libraries at this time are contemplating moving to an all-PDA program, and (b) press titles do in fact circulate in libraries, so we can assume that some portion of that $80 million is not at risk. What is at risk are the titles that never circulate. It’s commonly bandied about that 40% of books in academic libraries never circulate (an oversimplification, but useful for this analysis); if that’s true, then the presses are at risk for 40% of $80 million or $32 million. That figure represents a worst possible case, but the reality will not be nearly this severe.
In addition to the 40% of books that don’t circulate, however, we have to take into account the fact that of the 60% of the titles that do circulate, they don’t all get requested by patrons on the date of publication. Circulation varies by title, by library, by field, by so many things, but one analysis, the Walker Report, of the circulation records at the Cornell University Library, demonstrated that the period of circulation for a book is generally about 12 years. Thus a book published in 2000 would generally stop circulating by 2012. The circulation is not even over that period — that is, we don’t see one-twelfth of the circulation each year for 12 years — but still it would take 12 years for the publisher to receive all the income.
Here is an illustration. We have a hypothetical title that will eventually sell 1,000 copies to libraries (a very good sale for an academic book, but the virtue of that quantity is that it makes the arithmetic easy). We will assume (for the sake of simplicity) that the same number of copies are sold each year over twelve years. That comes to roughly 85 copies per year. In Year One, 85 patron requests result in 85 sales; in Year Two, 85 requests bring total sales to 170 copies; in Year Three, the total comes to 250; and so on up to approximately 1,000 copies in 12 years. If the books had been purchased when first published, the publisher may have received all the money in Year One, but with PDA, the receipt of the money is significantly delayed. So this makes the worst possible case referred to above (an exposure of $32 million) even worse. That twelve-year delay is a one-time occurrence — that is, after 12 years, sales through the just-in-time PDA system and the traditional purchasing method catch up with each other — but few businesses can survive such a shock to their cash flow.
The primary offset to these dire figures (from a publisher’s point of view; librarians may feel differently) is that libraries are not in fact going to all-PDA solutions. PDA is being tested and reviewed, tested and reviewed. While it is likely that PDA will grow significantly in the years ahead, from a publisher’s point of view it is being phased in. For many libraries, probably most, PDA will become just one of several ways libraries add books to their collections, so only a fraction of the 40% of books that don’t circulate are at risk. It will take several years of experience to know what that fraction is. In the meantime, publishers will be looking for new ways to sell books to academic libraries, a topic worthy of a post of its own.