Business Models, Controversial Topics, Economics, Sociology

Is PeerJ Membership Publishing Sustainable?

Discussions about open access publishing usually converge on two topical issues: 1) morality (fairness, justice, social welfare); or 2) sustainability. This post is about the latter. More specifically, this post is about PeerJ’s innovative membership publishing model.

In my first post, I described how PeerJ reflects the Silicon Valley culture of publishing. In this post, I’ll attempt to unpack their business model, explore the details, and try to come to an understanding of how this model will play out in the marketplace.

“Lifetime membership” is a term that is being used widely by the company and the media to describe the PeerJ business model, and yet I think the term is being used inappropriately here, at least in its full sense. “Pay once, publish for life” does not seem to apply if you read the second condition under PeerJ’s pricing plans:

If you choose not to perform at least one review every 12 months, then at our discretion your membership will lapse and you will need to pay $99 to reactivate your membership the next time you want to publish with PeerJ.

My wife and I are lifetime members of several organizations. In each case, we paid a larger sum of money not to bother with annual renewals. None of these organizations requires us to participate in any of their activities, take on any member duties, or perform any tasks necessary to keep us as lifetime members. In the case of PeerJ, these “lifetime membership” fees are more like “club entrance fees” or “initiation fees.” At this time, the duties of PeerJ members are pretty small: review at least one paper per year or submit a comment to a published article. However, we need to acknowledge that lifetime membership comes with real responsibilities, or the management has the right to revoke your membership status and escort you to the door.

The first condition of publishing is that every author must be a PeerJ member. While PeerJ caps the total number of paying authors to 12, we should be hesitant to equate this with an inexpensive publishing model. The average number of biomedical authors per paper has been rising steadily since the 1950s, and MEDLINE/PubMed reports that the average number of authors per indexed paper now exceeds five. What’s more, the average number of author recurrence is also rising. Some authors are listed on hundreds, even thousands, of papers.

Requiring that each author pays membership fees creates a disincentive for honorary authorship — bestowing authorship on those who don’t satisfy authorship criteria. On the other hand, such a requirement encourages ghost authorship – ignoring those who should be acknowledged. In the biomedical sciences, papers get published months (or sometimes years) after a graduate student, technician, or postdoc has left the lab. Getting these authors signed up as members in good standing may be more difficult to do, especially if you can’t find them or if they are unemployed and living on their parent’s couch. Moreover, you have just committed them to lifetime labor to PeerJ unless they don’t care about their membership lapsing.

Lifetime publishing also comes with severe production limits. For the Basic Plan (starting at $99), authors can publish no more than one paper per year. For the Enhanced Plan (starting at $169), authors can publish just two. If you want to publish any more, you’ll need to invest in the Investigator Plan (starting at $259). Let’s price out a new manuscript and assume that all authors will have the earnestness and enthusiasm to become lifetime members in PeerJ before the submission process begins . . .

A paper contains six authors: the first is the postdoc ($169), the second and third are technicians (2 x $169), the fourth is a graduate student ($99), the fifth is the PI ($259), and the sixth is the chair of the department ($259). Grand total = $1,124. This is in the ballpark of PLoS ONE and other similar open access journals. What’s more, I didn’t include the fact that the prices cited are based on introductory rates that are slated to increase come September 1, 2012. I also didn’t include membership re-initiation fees when the PI and department head’s memberships lapse due to the fact that they didn’t perform their annual member duties.

The billing process is going to be tricky for PeerJ. Instead of charging one author one publication fee (like PLoS ONE), PeerJ will need to verify many individual membership payments. While I have no doubt that many of these details can be automated — tagging authors who are not members or who have exceeded their publication limit — this is not going to sit well with submitting authors. “We’re sorry, we cannot process your publication until author #3 has upgraded his membership from Basic to Enhanced,” or “We’re sorry, author #6’s Investigator Plan has expired due to non-activity. Please provide a credit card so we can process your payment.”

In contrast, large commercial subscription publishers don’t need to deal with small billing issues with individual authors over individual papers. Elsevier and Springer and Wiley like to deal with institutions — or better, consortia of institutions — for very large collections of content for very large transfers of funds. If PeerJ cannot find savings in administrating peer review, it has to find it somewhere, and they are moving in exactly the wrong direction. Financial administration is not going to come cheaply.

My last topic is about how membership duties — specifically, reviewing or commenting — will help to create or undermine the community PeerJ is hopeful to create.

Lifetime membership builds economic loyalty, but this is not what PeerJ needs to make money. A member who pays once, contributes the minimum voluntary labor in order to remain a member (a perfunctory congratulations comment on a paper), and submits again over his lifetime costs the company money. In the US credit card Industry, this individual is known as a “deadbeat.” He cannot be charged for late fees, overdrafts, fines, or interest, which is how these companies make most of their profits. Commercial banks don’t like deadbeats and try to find ways to make them into more profitable customers.

I’m going to assume that PeerJ’s goal is to build a real, vibrant, and collegial community that will translate into bringing in new paying members. As long as current members don’t get any perks from bring in a new member (e.g. increasing one’s member level or reviving a lapsed membership, as this starts resembling a pyramid scheme), this is the right plan of action.

There are two problems with this approach.

First, changing the incentives for providing voluntary labor (reviewing and commenting) may result in lowering the quality of that work. Like most authors, I review as a duty, as a favor to colleagues, but mainly to learn something novel and important before everyone else. When I respond to an editor that “I’m swamped right now,” I am really saying, “I’ve read the abstract and skimmed through the paper and it’s not worth my time.” I was tactful and honest to one editor recently, when I mentioned that he was sending me too many inappropriate manuscripts. The incentive to review may change when it flips from a voluntary market to an economic exchange. In order to remain a PeerJ member, you have to either continue to submit papers, review others, or leave post-publication comments. It says nothing about competence. Peer review doesn’t need bodies, it needs competent peers. Attracting those peers will be the most difficult challenge of PeerJ.

Second, and more importantly, a community of informed reciprocity requires that a large community be built quickly in order to take advantage of the social network effects. Initially, when the community is small, it may be very difficult to enlist a competent member-reviewer for a submitted manuscript. PeerJ will need to go outside to the rest of the author community for review help, and this may be difficult to do if the quality of the submitted manuscripts are poor. The competition amongst open access journals is getting intense, with one publisher announcing that it will pay prominent authors to write review papers for them (with lots of citations), in order to attract more authors.

Companies that are based on network effects often grow along sigmoid curves. The goal is to get through that slow initial stage as quickly as possible to get to the real growth part of that curve. This is when companies start releasing media reports about doubling their sales, exceeding growth expectations, and so forth. The purpose of these press-releases is to attract more customers. If you can get over a certain transition in the graph, you can move into a stable market equilibrium. Miss this sweet spot, and you lapse back into an unstable equilibrium. At this point, you can start looking for a new model or develop an exit strategy.

Without any new income models, the lifetime membership model of PeerJ creates a challenging sigmoidal curve. Once growth starts slowing down and the company starts nearing the asymptote, it will spend more and more and bring in less and less. The company will look good in their early stages of growth, and this is when most startups do one of two things — sell big and move on, or cash out and leave a decaying company to a bunch of stock holders who mistakenly overvalued its worth.

(Also see, Part I: PeerJ: Silicon Valley Culture Enters Academic Publishing.)

About Phil Davis

I am an independent researcher and publishing consultant specializing in the statistical analysis of readership and citation data. I am a former postdoctoral researcher in science communication and former science librarian. http://phil-davis.org/

Discussion

10 thoughts on “Is PeerJ Membership Publishing Sustainable?

  1. The nightmare scenario for PeerJ will be an author who buys a lifetime membership and submits only good papers that he has written himself that get accepted. The initial $259 fee will eventually be swallowed up by the costs of copyediting each of the accepted articles from this author. Maybe PeerJ will have to add a requirement that every member copyedit at least one paper a year to make this model financially viable?

    Posted by Sandy Thatcher | Jun 14, 2012, 10:12 am
    • Will PeerJ offer copyediting to their authors? As I understand it, PLoS ONE does not provide this service. All I can see on the PeerJ site is that articles will be “professionally typeset”, with no mention of copyediting.

      Posted by David Crotty | Jun 14, 2012, 3:39 pm
      • If true, then this sets PeerJ (and other like OA journals) apart from their TA counterparts. Shouldn’t this difference be talked about more? Isn’t this a definite difference in quality between the two types of journals?

        Posted by Sandy Thatcher | Jun 14, 2012, 7:49 pm
  2. As you point out, even if the PI is a lifetime member, all of the trainees passing through a lab will need to join so that they can be co-authors. This will provide a continuing revenue stream, not a sigmoid curve.

    Second issue, the cost of electronic processing falls by half roughly 18 months. There are many ways to exploit this to reduce the cost of operating an electronic publishing house, e.g. automated copy edit suggestions. The tendency is to establish a mode of operations and lock in a cost structure. PLoS prices have not changed much over the past decade despite enormous improvements in cost/performance for processing, storage and communication of information. Time for someone to rock the boat.

    Posted by David States | Jun 15, 2012, 8:41 am
    • “Lifetime membership” assumes that everyone keeps up with their annual review duties.

      I’m pretty sure that the PeerJ folks have a sophisticated analysis of how many people won’t, but will end up eventually renewing; every time they do is a “new” membership. And if you have 12 authors on a paper, and, say, 4 of them lapsed, that’s revenue. Or 2 of them paid the $99 and this is the second paper for the year, that’s an upgrade membership, also more renewable revenue. IMHO, it’s quite a clever approach.

      (I work at Springer, my opinions are my own.)

      Posted by Scott Epstein | Jun 15, 2012, 9:05 am

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