This month’s “Ask the Chef” question is fundamental, so the answers are generally both vexed and brief:
Are we a service industry or a product industry?
There is plenty of room for interpretation here — who are “we”? what is a service? what is a product?
Let the responses begin!
Joe Esposito: An economist would define a services industry as one that trades in intangible goods. Don’t take my word for it; you can look it up in the Wikipedia. Since the publishing industry trades in intangible goods, it is a services industry. That should be the end of the story, but the reason that this question of services vs. products keeps coming up is that people have multiple notions of what services are. Most commonly in publishing, a services company is distinguished from a content company. AAS creates and markets content, but works with HighWire to host and deliver that content. In this scenario, HighWire is a services company. This is really a rhetorical debate about the meaning of “services.”
Rick Anderson: It seems to me that in the print realm, publishing is both a service and a product industry: it provides authors a service and provides readers a product. The more completely publishing moves online, though, the more it turns into a pure service industry. The service to authors remains roughly the same; for readers, the change is that they’re now buying the service of hosted access rather than a product that changes hands. The exception is when electronic files are actually transferred to the buyer and hosted locally rather than kept and served out by the publisher. In that case, the transaction is functionally the same as under the old print model — only the format has changed.
David Wojick: Product industries provide services and service industries provide products so the distinction is relatively relative. Even a steel mill has to meet specs and delivery schedules, which are not products. Engineers deliver drawings, which are not services. Publishing is really a third thing. Publishing has a product, but it also provides services, not to its customers, but rather to its suppliers, who give away their produce. But even the product, which is expressed thought, is more characteristic of a service. But it is not the publishers thought that is expressed. (No wonder we are all confused.) In short neither the producer nor the service provider model works very well for scholarly publishing. I like the contest model myself. Is a contest a service? But then there is the communication aspect. And the payoff for winning comes from elsewhere. I give up.
Ann Michael: In my opinion, products tend to be discrete, often immutable, packages or bundles. The creator of a product is defining, crafting and delivering those containers of content in a few standard variations with limited options for personalization or customization. Often a custom delivery means the customer choses Bundle B over Bundle A or perhaps selects an “add-on.” Services are fluid, variable, and customizable. There is still content being purchased, or partially provided for free, but the breadth, depth, and pieces within that transaction can vary. Just like in any other service industry, there can be self-service as well. The customer can decide, at a more granular level, exactly what they want and how they want to use it. Which of these scenarios sounds more like your business? More important, which sounds more like what your customers are requesting, even expecting? While it can be argued that publishing is both a product and a service industry, I believe publishers will be far more successful with a service mentality. A service mentality requires us to focus on the customer and their goals. It also requires us to take a holistic view of what value we provide specific user groups: researchers, authors, reviewers, practitioners, educators, etc. The service is the entire experience through which the customer interacts with content and a publishing brand. As a result, the services that publishersprovide are becoming more inseparable from technology every day. Does that mean that publishers need to be the source of all technology innovation? Not necessarily. It does mean that, at minimum, they need to be expert at appropriately applying technology to content in a manner that produces compelling value for their target audiences. Publishing is now a content and technology services industry.
Kent Anderson: I think we’re a service industry that produces products, or a product industry that produces services — if that’s not too Zen for you. What you charge for (the services or the products) defines your business model. For instance, traditional publishers charge for products — discrete, time-bounded subscriptions; measurable distribution to a measurable audience for advertising; and so forth. Service is part of product support, but a background activity. If you flip the model, and charge for services and not the product, then you have things like blogging platforms, open access publishing, or a library. These provide services that can perceived as free because the product — a blog, an OA article, or utilization of library resources — is perceived as free, even though indirectly it’s paid for somehow. So just as traditional publishing is product-based with a service backdrop, OA publishing, for instance, is service-based with a product backdrop.
David Crotty: I’m going to take the cop out answer here and answer “Yes” to both. To quote Cameron Neylon from our recent interview, “We have traditionally bundled lots of functions together in the organizations we call ‘publishers’,” and that diverse bundle includes both products and services.
Scholarly book publishers are, without a doubt, based around creating products. The genesis for most books starts with an acquisition editor, who starts with a raw idea and turns it into a final physical (and digital) product. Some percentage of scholarly books do come in “over the transom,” but the majority, in my experience in the life sciences, are plotted out from scratch. The editor carefully plans and commissions content, content which wouldn’t exist without the book. The endpoint is a collection of material sold as a product.
Scholarly journal publishers are perhaps more of a service industry. As many are quick to point out, technology has reached a point where researchers can do for themselves much of what a publisher offers. The question is why they would want to spend their valuable time doing such mundane work. Researchers, scientists in particular, do an enormous amount of outsourcing. Their job is discovery, doing experiments, learning new things. As such, they pay someone to wash the test tubes in the lab rather than doing it themselves, because that’s time and effort taken away from experimentation.
Many labs buy pre-mixed solutions that they could spend the time to make from scratch themselves at a lower cost, and much of biology is dominated by kits, prefabricated sets of reagents for performing a particular assay, again, faster, but much more expensive than making everything yourself. Labs farm out common activities like sequencing DNA, making constructs, breeding flies, or making transgenic mice. This is all done so researcher time can be concentrated on the cutting edge of garnering new knowledge.
And that’s where journal publishers come in. We provide a set of necessary services for the communication of results. These are often tedious and time-consuming services, and like the dishwasher, the sequencing center, or even the campus plumber, we are paid to do the necessary things in order to free up a researcher’s time to do research.
One can certainly argue over which of the services provided are necessary or worth outsourcing, and we’re currently going through an era where technology is both opening up new types of services and making older ones obsolete.