The question in the title of this blog post was put to me by a senior executive of one of the largest publishing companies. Her company, like the other large commercial ones, has been bulking up over the years by licensing the rights to journals and, occasionally, other forms of publications from professional societies. Those publications are then integrated into the licensing company’s operations for everything from the management of submissions system to production and sales and marketing, everything but the defining editorial work. For these licenses, her company pays large royalties and usually significant annual guarantees. But her point was well taken: her company would pay so much more than the licensing fee for outright ownership. Why do societies insist on leaving so much money on the table?

This question gets at the heart of what professional societies are and how they think of their publications. Let’s put the question this way: Are the publications of a professional society an asset or an expression of the society? An asset can be bought and sold — think of a desk or a house — but an expression of something is harder to get one’s arms around. If publications are central to the way a society thinks of itself, how do you sell them off? This begs other questions: What constitutes centrality for a society, and why do some societies view publications as central while others do not?

A bit of background. Many publishers, and all of the largest ones, have a mix of publications that they own outright and publications that are owned by a third party, most often by a professional society. For that latter category the larger publisher is a service provider to the society publisher. The large publishers create these service arrangements for a number of reasons. For one, and this is perhaps the reason that this kind of business got started in the first place many years ago, the larger publishers may have excess capacity. Thus, bringing on a client for services allows the larger publisher to make some money on infrastructure that would otherwise lie dormant. Another reason is strategic development and relationship-building. So, for example, a large publisher with no publications in the area of clinical medicine may sign up a society publisher in that area (and pay a premium) as a way to begin to build a presence in the hospital sales channel. Or a large publisher may sign up a client for services as the first step to an eventual outright acquisition (this happens more commonly with books than journals). But over the past decade or two, the primary reason the larger publishers have set out to provide services to smaller ones is that this brings scale to the larger publisher’s operations. With scale come many benefits: stronger pricing power (and don’t libraries know it), leverage with vendors, and a great deal of operating data that can be mined for patterns in sales, marketing, and even editorial. In journals publishing, big is better.

If you happen to own and operate a small for-profit journal publisher (not too many of these left), the financial attraction of an outright sale almost always outstrips the appeal of a licensing agreement. Most often, unless the small publisher is under duress, the sale takes place when the owner begins to think about estate planning. (I guarantee that the heads of business development at all of the largest publishers know the ages of the owners of the independent for-profit publishers.) But a society publisher is a different matter. There are no grand-kids to put through college, no alma mater deserving of a bequest. A society’s economic interests are those of the society itself, which endure beyond the lives and careers of any single member.

What gets lost in discussions of society publishers is the implications of the word “society.” A society publisher is not just a publisher but a social entity. For a society to sell off its publications, it often feels like it is lopping off a piece of itself. There are society members who publish in those journals, others who edit them and provide peer review. While some of this work is compensated (much more than is generally supposed), part of the willingness for society members to provide these services on a voluntary basis stems from a sense of social responsibility. Someone will say: I worked for years as a reviewer for that journal and now you are going to sell it off to Springer Nature??? What kind of schmuck do you take me for?

All these issues come to the forefront during an actual negotiation. “While we could forge a licensing arrangement,” Big Publisher says to Society Publisher, “we can make it worth your while to sell us the publications outright.” After some jockeying over price (Big Publisher always tries to get these assets on the cheap, and Society Publisher may not be familiar with market benchmarks), a financial deal gets struck.

There are aspects of scholarly communications that are simply resistant to pure market analysis. The for-profit firms are not interlopers; they are as much members of the community as an academic librarian or a biologist

And then the deal collapses. Society Publisher suddenly realizes that Big Publisher wants to have perpetual use of the trademark that appears on the publications, and almost always that trademark is the same as the name of Society Publisher. Let’s imagine the Society of Useless and Pointless Knowledge and the society’s journal, the Journal of the Society of Useless and Pointless Knowledge, edited by Professor Bob Dylan. How can that society allow the likes of Elsevier or Taylor & Francis to use that name in perpetuity? And what other publications will Big Publisher want to introduce under that name, which now partially lies outside the society’s control? Big Publisher will tell Society Publisher that the only reason it is willing to pay so much for the publications is because the trademark comes with them. So the deal reverts to a more standard licensing arrangement, with a term of 5-7 years.

There are aspects of scholarly communications that are simply resistant to pure market analysis. The for-profit firms are not interlopers; they are as much members of the community as an academic librarian or a biologist. But whereas in other markets–consumer electronics, say, or cosmetics or pet food or any of thousands of other business segments — the underlying dynamics seem to spring straight out of the pages of Adam Smith, scholarly communications has greater complexity. It is an odd and (to my knowledge) unreplicated mix of the for-profit and the not-for-profit. So don’t push too hard for ownership. Sometimes simple participation is what is called for, and even that can be highly profitable.