Social sharing in the sciences may be ending its honeymoon phase. UniPHY has closed. Connotea is closing in March. Other sites like BioMedExperts seem to have become bolt-ons at the largest publishers.
And then there’s Mendeley.
Mendeley has been a juggernaut of marketing within the scholarly community — for 2-3 years, it seemed every meeting had a standard talk from Mendeley representatives boasting their adoption and usage figures. At the same time, many publishers have been watching Mendeley carefully — it’s a service that allows for the sharing of published content in a manner that seems to elude enforcement of copyright and licenses.
Over the past few years, Mendeley has been approached by some large players in scientific publishing — Nature, Thomson Reuters. The latest rumor is that Elsevier is in advanced talks with Mendeley about acquiring the firm’s assets for $100 million.
Elsevier has been friendly with Mendeley, having referred clients to Mendeley when Elsevier’s 2Collab was shuttered in 2011. This makes the rumor even more interesting — if Elsevier failed with its own social sharing initiative, 2Collab, why go back for another thrashing?
Elsevier has been acquiring software companies aggressively over the past few years. In August 2012, they acquired Atira, a company in Denmark which provides institutional repository software called Pure to higher education institutions. In 2010, Elsevier acquired Collexis, which provided semantic technology to scientific publishers and vendors. As part of this, they also were able to integrate BioMedExperts, a social portal for the sciences. Mendeley would fit well with this set of software and service acquisitions. Perhaps Elsevier’s strategic planners feel that timing and positioning both played a role in 2Collab’s failure. They may feel it’s time for a more comprehensive approach.
However, acquisitions change properties. The outcome of the Collexis acquisition is worth contemplating. Once the heart of a number of social sharing initiatives, Collexis has now been assimilated, as this text from the Collexis home page indicates:
In 2010 Elsevier, the leading global publisher of scientific, technical, and medical information products and services, acquired Collexis. Collexis’ semantic technology and solutions are now part of Elsevier.
This transformed Collexis from a market player capable of supporting a number of publishers into a captured Elsevier property devoted to supporting its owner. Its role in the ecosystem has been greatly diminished.
Mendeley is currently a relatively neutral platform that is populating a large ecosystem of apps through its APIs — APIs similar to ones Elsevier has tried to popularize through SciVerse, but much less effectively. While Mendeley’s APIs support 240 research apps, SciVerse supports about 100, or less than half. Are these 240 APIs worth $100 million? It’s unlikely. So what is the value of Mendeley?
Its main value seems to come from the large numbers it boasts about the documents, users, and sharing on its platform. But what is this worth? Currently, tens of thousands of dollars, based on revenue figures the firm has mentioned. If that’s the case, Elsevier would be paying a 1,500x multiple at the speculated price of $100 million. Suddenly, the quoted price tag seems like it must be off by at least two orders of magnitude.
Mendeley is currently selling data out of its system. Could Elsevier do this more effectively? Does it have corporate synergies that could make this 1,000x more valuable?
Other factors seem to argue against the possibility of an Elsevier acquisition, beyond the outrageous over-valuation a $100 million price tag would represent.
Will Mendeley become more popular as an Elsevier property? I think it’s unlikely, despite a statement made in an article about the possible acquisition in TechCrunch:
. . . the bulk of academics will be more inclined to use something owned by Elsevier.
I don’t believe academics care what Elsevier owns — it’s not a brand most scientists or researchers pay attention to. Those who do pay attention probably currently have a fraught relationship with the brand. Ultimately, the question will be more about value and relevance of any service Elsevier offers.
At least in the short-term, an acquisition by Elsevier seems likely to create headwinds for Mendeley. Things change when a small company is acquired by a larger one. Management processes and relationships change. Corporate cultures clash. But in the case of Mendeley, there are many things an Elsevier acquisition might alter within the marketplace, as well:
- Deep pockets. Suddenly, Mendeley becomes a meaty target for legal challenges over unfettered sharing of copyrighted content — its owner would suddenly have deep pockets. Publishers who have forestalled legal actions based on the sharing of their articles and unauthorized reuse may rethink their stances. A lawsuit or two might emerge rather quickly. In addition, Elsevier has contracts with many partners. Beyond copyright and licensing, there could be plenty of contractual landmines.
- Loss of renegade virtue. Lawsuits might also be more palatable because the sheen of virtue Mendeley has acquired as an idealistic and renegade startup would be gone. The PR downside of suing Mendeley is significant; the PR downside of suing Elsevier is comparatively small, if it exists at all. Beyond this, enthusiasm for Elsevier APIs, Elsevier data analysis of scholarly activity, and other Elsevier involvement in scholarly sharing may never materialize. Mendeley may hit a hard wall of user disenchantment if an Elsevier acquisition were to go through.
- Loss of OA virtue. Being acquired by Elsevier, a company so often a target of OA rage and animosity, would create quite the pickle for OA advocates and Mendeley staff. The tacit help OA publishers like PLoS and BMC have given to Mendeley may evaporate. Initiatives like the Binary Battle, a co-sponsored development contest supported by Mendeley and PLoS, would not likely continue. Community support may shift quickly away. The technology is not the magic with Mendeley — the community reputation is the magic. The technology can be recreated; the community reputation is far more fragile. The community may want to shift to the next company that agrees with its ideals but is small and poor enough to be effectively immune to lawsuits and contractual entanglements.
- Loss of advocacy angles. As an insurgent, an independent Mendeley could advocate for various approaches and take certain stances in the publishing community. Aligned with Elsevier, how would advocacy for things like the Reproducibility Initiative, PLoS, and other matters come across? Would it be accepted by the community as anything more than cynical big business posturing?
- Alignment with a publisher. Technology companies have fewer constraints on them than publishing companies. The contracts, community, and expectations are very different. A publisher is expected to behave well toward other publishers, to respect the boundaries it would want respected itself. The conundrum of owning Mendeley may be too much for Elsevier to manage.
Of course, Elsevier will have thought through these matters, and is likely to have responses in place. Whether they are good and effective responses remains to be seen, assuming this proves to be more than a rumor. One response might be to fold Mendeley into Scopus and the agreements already extant for that service. However, those agreements might not be robust enough if challenged once Elsevier’s grand plans around meta-publishing sink in.
At this point, taking the rumor at face value, the potential acquisition of Mendeley seems fraught, over-valued (at the reported price of $100 million), and unlikely to retain its brand or technology value.
There is also the possibility that Elsevier is buying Mendeley to disassemble it. Perhaps $100 million is a relatively inexpensive price for a car that can later be sold for parts.
Elsevier has made successful acquisitions in the past, with Cell Press coming most immediately to mind. Springer’s acquisition of BioMed Central didn’t hurt that enterprise. But both of these — Cell and BMC — are traditional in the sense that the acquired companies process and publish content, just like their new owners. There was a basic family match. That’s a key difference.
In any event, we seem to be hitting an inflection point in the social sharing experiments in scientific publishing. UniPHY is no more. Connotea is closing. Mendeley may be purchased by the world’s largest scientific and academic publishing company. Academia.edu is much quieter than it used to be.
The days of wine and roses seem to be drawing to a close for social sharing in the sciences.