You hear the one about the new business model? Two guys walk into a bar. The first one says, I have a new idea for a business model: the bartender should pay for the dissemination of the drinks. The second guy says, I have an even better idea: we should set up an endowment and use the income from that to pay for the drinks. The bartender listens closely.  Then, using his invisible hand, he sneaks up behind the two guys and tosses them onto the sidewalk. There is no punch line.

Joining the community. Image via Susanne Nilsson.

I have been thinking about the plight of the bartender–the gatekeeper, the publisher–for some time and have concluded that whether he is doing a good job or a bad one, not everyone knows exactly what it is he does, and that includes some bartenders as well. Let’s take a break from talking about new business models for a minute and consider the current ones. This is not to make a case for the old vs. the new but simply to clarify what it is that publishers do.

I want to focus on the business model for scholarly books, especially those that are published by university presses. This is in part a coincidence, as I recently participated in a plenary session (“Not Just Open Access”)  at the AAUP annual conference. I am not going to summarize my entire presentation here, though I am embedding my slides at the bottom of this post, but I do want to analyze the community dimension of university press publishing.

The AAUP has 134 members. These members publish a wide range of materials, from scholarly monographs to journals, some textbooks, reference books, regional titles, and so on.  But the core of the enterprise, at least among the U.S. presses is books, particularly books by scholars for scholars. The interesting thing about these presses is where the authors come from. Although there is no definitive survey on this, anecdotally it appears that for most presses, the percentage of books written by the faculty of the parent institution is in the high single digits. Some estimates put the figure higher, but I have never heard anyone suggest a figure over 25%. My own guess is that the correct figure is in the range of 7% to 10%, though I would love to see the results of a comprehensive survey.

This means that virtually all presses are really in the business of publishing the work of the faculty of other institutions. This doesn’t mean that the hometown faculty does not support their university press. When a press is threatened with sharp cuts or even a complete shutdown, members of the faculty typically rise up to save the press, and their track record is good. But even so, the fact that a press primarily publishes the work of authors from other institutions can lead to a lack of support, typically in the form of underinvestment short of outright shutdown, from the parent institution.

The peculiar thing about university press publishing is that even the faculty that is highly supportive of its press may choose to publish elsewhere. And the very same faculty may discourage junior faculty from submitting manuscripts to the home institution press. The reason for this paradox is that everyone fears that publishing with your own press may be perceived to be an inside job. (The presses fear this, too. They are understandably firm about their need for editorial independence.) Faculty seeks publishing elsewhere because this helps to support the notion of third-party validation. A university press, in other words, is as much in the business of certification as it is in the business of dissemination

While everyone (or almost everyone) believes that certification of faculty is a good and necessary thing, not everybody sees a need to pay for it. This is because of the free-rider problem that is at the heart of the troubled economics of so many university presses. Institution A has a press, which it subsidizes, even as most of the press’s costs are covered by sales in the marketplace. Institution B, on the other hand, has no press or has only a tiny one. This saves Institution B money. Institution B can get away with this because the faculty of Institution B is not trying to publish at their home institution but with the press at A or elsewhere. This is a structural problem of university press publishing, for which there is no obvious solution. Shaming doesn’t work. Try it.

An individual press may contemplate its situation and conclude that rather than seeking a subsidy from its parent, it would be best to make its way in the marketplace. This is not a nutty idea; there is indeed a market for scholarly books, which can be served profitably. Some presses, and quite a few for-profit scholarly publishers, operate at a profit. They are able to do this for the simple reason that they are very good publishers. A good publisher studies the market and publishes books that have a sufficient appeal to generate a surplus. Some subject areas have stronger markets than others–economics and science, for example, over literary criticism and women’s studies–and a wise press may aim to build its program in those areas. A good publisher also looks to global opportunities, developing new sales channels, and to keeping a lid on costs. Publishing, even scholarly publishing, is a business, and some scholarly publishers are better businessmen than others.

If a university press’s only goal were to publish scholarly books profitably, then that would be the end of the discussion:  publish books that sell and stop whining. The problem here is that presses are also being asked to operate as certifiers. Yes, certification in science and economics is important, but how about those aspiring instructors of comparative literature and women’s studies? If the markets for those categories are weak, and the presses will only publish in categories that are strong, then those disciplines will lose access to certification. So, while an individual press may prosper by out-publishing its peers, the community as a whole suffers because their is no comprehensive solution for the certification function.

In other words, the business model of a university press is a community affair. One institution fields a press that works in certain areas, another institution has a press with a program in other areas. Add more presses to the mix, and then stir. Faculty espouse support for their home presses, but publish elsewhere; faculty at other institutions seek publication and certification at the first press. It is a reciprocal arrangement, undermined by free riding.

It is important for individual presses to realize that the solution to this problem is outside their span of control. The best a press can do is to become the very best scholarly publisher possible. Perhaps the provost of that press’s institution can take a broader view, but even the provost must satisfy competing demands from his or her many constituencies (“Should I increase the subsidy to the press or should I give the money to add 3 graduate students to the department of chemistry?”). It’s a zero-sum game.

The real issue is what is required for certification. That is a bigger question than publishing. A new view of certification would alter the way we think about scholarly publishing and would likely transform the university press world as we know it today. So let’s stop talking about new business models and focus instead on the real problem that has to be solved. If university presses are part of that solution, that is well and good, but if they are not, it’s time to move on.

Joseph Esposito

Joseph Esposito

Joe Esposito is a management consultant for the publishing and digital services industries. Joe focuses on organizational strategy and new business development. He is active in both the for-profit and not-for-profit areas.


12 Thoughts on "The Business Model is a Community Affair"

Many university presses have a large catalog that is not totally dedicated to publishing academic monographs but are related to the mission of the press. Thus the issues that are raised here regarding numbers of academics within the institution and globally that have their works published by “their” press or elsewhere are readily attainable along with sales figures and profitability. Therefore it seems straight forward to understand which presses are break even or profitable and those that are not and why. There are a lot of unknowns here that can be dispelled rather than speculated upon.

Next, taking a note from the shifting open access journals, what might the reason be not to front end, separately, the cost of “peer review” either by the press or a 3rd party. And, as with journals, perhaps the function of editing to get publishable copy could also be handled differently before submission to a press. Maybe its time that academics stopped defaulting to a 3rd party to do what they should be doing in their own community?

The need to cover costs for publishing, as outlined in a previous article in SK, is clear. And it maybe that some materials do not get published because of this burden covered by the presses. Maybe the mark of a truly publishable volume is different than the academics’ needs to add a notch to their resume while the volume lays languishing, unread, on a library shelf or in an electronic database waiting and hoping for a request to be printed.

In many ways the function of an academic publisher has been inverted where accepting an academic’s “book” for pub/perish becomes the important function rather than the publishing itself. Whether articles in journals or books, there are serious issues. As with the science/tech literature when the granting agencies stop using impact factors as a base, then what?

Again, as with open access, with the Internet, it’s possible to do prepublication and post publication peer review. That seems to open up options for the academic community to start taking on its responsibility rather than to add to the overhead of academic book publishers.

First, I’m not aware of many university presses that make sales figures for individual books publicly available. You can get some of the financial information for presses overall, particularly for those that are not-for-profits or that are part of public universities, though perhaps not at the granular level you’re seeking.

That seems to open up options for the academic community to start taking on its responsibility rather than to add to the overhead of academic book publishers.

Perhaps I don’t understand what you’re saying, but doesn’t the university press exemplify the notion of the academic community taking on this responsibility? Isn’t that the whole point of a university creating and running a press?

Time is an academic researcher’s most valuable commodity. At least in the world of science, anything that can be outsourced gets outsourced, in order to free up the researcher to spend more time doing research. No chemist washes their own test tubes, no biologist changes the water bottle on her mouse cages. The management and recruitment of peer reviewers and the editing process are both time consuming efforts. I’m not sure many academics would make that trade-off (and pay for those services out of their own pockets/grants).

I’m also not sure I see the advantage of shifting this sort of work to commercial third parties rather than keeping the funds within the academic community.

Hi David

First, I am a chemist and have had major grants. I would not trust a bottle washer to evaluate the research we are doing. If you are casting reviewers at presses in that category, I wonder what that says about the quality of what they pass through. Or the reputation of the press?

Second, academics are doing peer review and have been for journals. Pre and post review are accepted and allowed under the Open Access options. The same should follow logically for books. The journal publishers don’t do peer review- academics do. And with OA there are fees for the basic services, including those for editors.

The whole point of the original post was sharing of costs. It makes no difference if the press is academic, non-profit or for profit, the costs are to hire professionals at the press who are paid for that skill which makes the press reputable and worth submitting to. The academic community, as you suggest, above sees the academic as too important to spend time? Tell it to the peer reviewers of academic journals who do this at low or no cost- and as far as the writing in academic journals, it shows when they say they don’t have time to edit except for content.

As with journals, there may be no correlation between the costs and the sale price for a monograph. As for the poor humanities scholars, please note that there is a poetry foundation and other resources to support this. I would note when the universities were founded there was a balance between humanities and what we call sciences. In fact, in early universities the faculty really crossed lines. Along about mid 19th century in the US with the Morrill Act and later, post WWII with the start of serious grants for research the balance went way over to STEM. But there most researchers were happy to pub/perish in journals. Only in HSS was there an unbalance in research fundings. But in HSS, the gold standard for pub/perish insists on “books”, mainly their dissertations which are now accessible on many databases. So the rationale for a “book” becomes moot if the academy does its work and lets the presses publish what they can sell rather than cover services which should not be needed.

Time for HSS scholars to take the expensive curation of their “books” out from under the university presses just for pub/perish. The overpricing of journals to cover books and the overpricing of books because academic libraries will pay is starting to fray. The recent study of pricing of academic journal bundles to different libraries is a heads up. The price for paperback books that will not widely circulate instead of shelf-stressing hard bounds and others is changing buying habits. The HSS communities are crying because the STEM folks get their journals but libraries cut back on books. That is a double cost. No book purchases and shift to e-books and alternatives. HSS has its problems that won’t be cured by reshuffling costs.

But how well could your peer reviewers wash bottles? Sorry if my point was confusing, I was not equating the two acts, just bringing up the notion that researchers outsource many tasks that require time and effort away from doing research. And I’m not talking about the actual peer review itself (which, as you note is done by academics), I’m talking about managing the process. I’m talking about providing a fair and neutral third party to find qualified reviewers,tracking down current email addresses, invite them, get them to sign on or invite more if they decline, track the review process, answer questions, troubleshoot the electronic peer review system, provide customer support, bring in the reviews, etc., etc. Much of a Managing Editor’s day is spent on these mundane tasks. How much of your day, every day, would you be willing to devote to correspondence such as this? Or is it better for you to find someone else to do the scut work for you so you can concentrate on more important things?

I’m not sure I’d agree with the statement that publishers “don’t do peer review”. Many journals employ full time, professional editors. These people review submissions as they come in and determine whether they should go out for further review or be immediately rejected. Then, when the outside peer reviews come in, a professional Editor in Chief makes the final decision. This is all part of the peer review process and done by publishers.

In addition, as mentioned above, the entire process is managed by the publisher. Where this level of oversight has been omitted, participation is very sparse. Choose any journal that has reader comments and determine the percentage of papers that have substantive comments. Is it as much as 1%? Clearly someone needs to drive the process, without this, it rarely, if ever, works. And as you note, this management must be paid for somehow.

So where should that money come from? Should it come out of research funding? Is that a sacrifice that academics are willing to make? What percentage of your lab’s funds are you willing to devote to paying for management of these processes? What about fields where there is little or no funding? Should they be allowed to publish? Some interesting recent studies have shown that most science research programs at universities lose money, while most humanities programs, with lower overheads and many, many more tuition paying students, turn a profit. Perhaps those profits could be put toward funding publishing for those scholars, rather than spent on the school’s football team (or to cover the debts run up by the scientists).

And again, if you want to change the publish or perish culture of academia, that’s one thing. But I still see no difference between academics “taking charge” of publishing or that academics at a university banding together and establishing a university press which they run and control. Is there value in having individuals do what could be done more efficiently and cheaper by a centralized resource?

Hi David

There are a number of issues that are intertwined here, ones that can’t be resolved by our exchanges but which should be put on the table to respond to the assumptions that were made in the original posting:

1) Journal publishing appears to be highly profitable. The estimates I have seen are around 40% gross profit (or maybe even “net”, I forget). I have not seen any figures regarding university presses here to support Joe’s thesis, nor have their been rising ululations from the presses.

2) All book publishers do a significant amount of curating of the books they desire or do accept, including, often, advances and all the support services which you identify. It is not clear how this differs between various publishers and the areas they tend to favor, particularly academic presses.

3) All publishers take risks on the volumes they select to publish based on many factors. I would be very depressed as a publisher or staff member of a publisher if a weighting factor of any size were given to a decision because it was written by an academic out of necessity for promotion and tenure decisions and our function would be to curate this to a point where it could be published. That is a heavy burden in psychic energy, intellectual responsibility and financial investment. This essentially puts the press on a faculty member’s review committee.

I know one HSS department that sends a faculty member’s publications out for review for the tenure/promotion committee (essentially a post publication review).

What academics have done with their responsibilities to evaluate their fellow academics is to essentially contract out their duties to publishers of books and journals. And that makes publishers accomplices to this abrogation of academic responsibilities.

Please stop repeating the old saw that journals make a profit of 40%. Elsevier reported operating income of 39%, but what’s true for Elsevier is not true of the industry overall. Many journals lose money. The key reason Elsevier has the margins it does is the scale of its operations. With 2,300 journals, Elsevier has ample opportunity to spread its fixed costs. It’s hard to make money if you have only a couple journals.

Tom, it sounds like most of your perceived problems lie within academia and its system for career reward and promotion, rather than with the practices of university presses. UP’s (and scholarly publishing in general) is a reactive service industry. Practices arise because they are what academia demands. Rest assured that if academia decides to revamp its career structure, scholarly publishers will adapt to suit those needs.

But I want to echo what Joe said in his post above. The 40% figure is an outlier, the most extreme number available from the biggest publisher in the market, and it’s also inaccurate–that number looks at a large division of a large company that produces a wide variety of products, not just journals. If you’re interested in learning what University Presses earn, any that are at publicly owned institutions should be making this information available, and any that are not-for-profits should be filing publicly available 990 forms. You can also check university annual reports which often include numbers from their presses.

A good analysis, Joe, and I have a couple of comments. Re slide 8, on percentage of authors from a press’s home institution: At Georgetown University Press the percentage of authors, book editors, and contributors to anthologies in 2013 was 15%. Re slide 11, on what an exceptional publisher would do: Assessing the market, yes. But how about publishing in subject areas that reflect the institutional strengths of the university? That doesn’t necessarily mean recruiting a high percentage of homegrown authors, but it does mean building a list that capitalizes on signature programs and well-established identities in the academy. At Georgetown, for instance, that results in a strong publishing emphasis on languages, international affairs, and religion.

Yes, institutions need to stop outsourcing the evaluation of scholarship, especially where economic factors skew that assessment. One idea to consider is to take the UP concept and scale it up beyond the confines of a single institution. A consortial organization on the scale of EduCAUSE that could contain the agendas of many SIGs (Special Interest Groups) might lessen the impact of economic factors on assessing scholarly work (the decision to publish) and mitigate the free rider problem. It’s easier to subscribe to a consortium than it is to field ones own press. Making greater use of digital technologies, perhaps eschewing paper entirely, might also reduce the pressure of economic factors.

Maybe I’m missing something, but I don’t see how a consortium would solve the problem. Because universities outside the consortium would still benefit from the press without paying in; they’d be free riders. How do you keep members from dropping out if their budgets tighten up? Would you ban non-members from publishing with the press?

Dear Joseph,

An excellent essay that shows the complexity of university press publishing.

All the best, John Long

I’m not sure people commenting here fully understand how the editorial process for university press book publishing really works, how different it is from journal publishing, and how complex it is by comparison. Please read my essay “The ‘Value Added’ by Editorial Acquisitions”:

Faculty choose presses for both their “prestige” and their reputations in the fields in which they publish. If a faculty member’s home press does not publish in a field where that faculty member is working, then of course another press will be chosen. If the reputation of the home press in the field is strong enough, it will almost always override the “bias” against publishing with the home press.

Presses do not play the game of publishing to help faculty gain tenure and get promoted. Universities use presses for that purpose, but presses themselves do NOT make that any factor in their decisionmaking about what to publish. Certification is a byproduct of their service. Of course, universities might be reluctant to support presses if they could not be used in this way.

The solution to the “free rider” problem is embedded in the new AAU/ARL proposal for subvention of first books. Once the funds are provided up front for publishing these books, universities will naturally compete with each other, as they do now in awarding grants to junior faculty, in providing these subsidies. Faulty will want to work at universities providing such subsidies. Economist and head librarian at Michigan Paul Courant pointed this out years ago.

At Penn State about 10% of our authors were from the PSU faculty.

Penn State’s dozen journals, when i was director there, produced a healthy surplus to help support the money-losing monograph publishing. I suspect there is not a university press in the country that does not make a surplus from its journals.

The reason that university presses publish all types of other books is that they need the “profits” from these other books to support monograph publishing, which is their main mission. When they lose sight of that as their main mission, they are more vulnerable to being shut down in tight financial times. Just ask the staff of the former SMU Press, which published mainly fiction (good though it was).

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