With Elsevier’s acquisition record over the past few years, it is no longer particularly surprising to wake up to a press release announcing that a previously independent company is independent no more. Most recently of course is the Aries System acquisition. In response, on Monday, Angela Cochran wrote wisely about some of the issues that an independent publisher must consider when relying on a platform that is no longer independent. In contrast, Kent Anderson assured readers that the promised seeming competition is not a concern because of Elsevier’s emphasis on “oversight and firewalls.”
My own view is that all the talk about whether or not there is a firewall that will or will not hold misses the point. The key question that publishers continue to face is how to handle themselves in an environment when Elsevier — as it proclaims loudly and proudly to anyone who will listen — is no longer a publisher. I pondered this question last year and, re-visiting that essay, I can’t help but notice that Elsevier’s acquisition of Aries Systems moves toward the publication services offerings that I predicted 18 months ago.
Strategic Acquisitions Drive Platform Development
It is increasingly clear that focusing on the particular product offerings of an acquired company and its overall profitability is not the full story of an Elsevier acquisition. We need to consider the capacity that Elsevier is developing. As Roger Schonfeld has detailed, Elsevier, Digital Science, and others are all seeking to become a full workflow solution for research and publication, particularly as subscription revenues for publications increasingly appear threatened by open access policies, coordinated national contract negotiations/cancellations, and piracy.
Focusing on the immediate product offerings – or the customer base – of acquired companies may even be a distraction from developing an understanding of the strategic significance of these acquisitions. For example, as we now know, Mendeley has evolved to be not only a citation management system but also a platform that has been enabling Elsevier to unify and centralize Elsevier user accounts across platforms and to present a dashboard to the individual researcher of their citations, metrics, etc. Mendeley now describes itself as an academic social network. With the additions of Mendeley Datasets, Careers, and Funding, Mendeley is steadily and stealthily becoming a scholarly gateway for researchers, whether or not an institution licenses Mendeley, that provides an integrative experience across disparate platforms.
Aries Systems Enablement
So, what does Aries enable if we consider it a platform for future development rather than only as a set of existing product offerings, particularly in light of the platform capabilities of other Elsevier acquisitions, products, and services?
I’ve noticed that, just as when Wiley acquired Atypon, a great deal of the focus is on publishers’ concerns that their data in Editorial Manager will remain firewalled within the system. This concern, while understandable, especially in the short-term, represents an unspoken (perhaps even unconscious) assumption that manuscripts will continue to enter Editorial Manager through submission to a particular journal. But, what if that wasn’t the case? What if manuscripts were no longer submitted only to specific journals but also flowed to journals through some sort of central submission and then routing system? What if some of those manuscripts entered Editorial Manager via a preprint platform or through institutional portals?
Publication Services in a Stack?
Alejandro Posada’s and George Chen’s graphic of the scholarly workflow overlaid with Elsevier products has, until now, been empty of Elsevier offerings at the stages of manuscript submission, peer review, and publication processing. With the acquisition of Aries Systems, Elsevier will now be providing publication services and, potentially, is poised to provide them as an integrated “vertical stack.”
Elsevier’s “Online Peer Review System and Method” patent (which they claim is only “defensive”) presents the potential for a scholar to submit a manuscript to be matched through fingerprinting with its best possible potential publication venue. It would then cascade through review and editorial processes and then on to publication. As the prior art section of the patent explains: “existing systems only offer a shared database among sister journals, whereas a shared database is not available for non-sister journals, for example, journals that are not owned by related entities. Thus, it is impossible for these existing systems to accommodate the user’s request to switch from a sister journal to a non-sister journal.”
In other words, with the Aries acquisition, one could envision a future in which manuscripts enter a re-born Editorial Manager – perhaps directly into a general author portal or perhaps via a preprint platform (e.g., SSRN) or institutional portals (e.g., bepress) – and are then placed with the best possible journal after analysis through the Elsevier Fingerprint Engine. Elsevier could also develop an institutional offering of this service for universities that might wish to move towards centralized support and management of manuscript placement.
By building out such a “vertical stack” platform, Elsevier would preserve the firewalls currently offered to Aries customers while building an alternative competing system, potentially charging Editorial Manager customers a fee to include their journals as targets of the placement service or bundling it with existing services to maintain advantage over competing manuscript submission and review platforms. Such an offering could eventually displace existing submission workflows and publishers would find themselves locked in to the Elsevier publication services stack.
Libraries, universities, and publishers alike should be concerned about the potential implications of Elsevier building out an integrated stack of publication services. Scholars and universities will likely find great value in publication services that improve efficiency and effectiveness of manuscript submission and processing; however, licensing additional Elsevier services and/or replacing library subscriptions for journals with institutional subscriptions to a publication services platform will only continue to exacerbate the financial challenges in higher education. Though efficiencies of scale may hold back prices from increasing as much as they might otherwise, the likely eventual consolidation of even more small publications into Elsevier means that prices will increase as competition decreases. The Big Deal for workflow and publication services is unlikely to bring a different result than the original Big Deal for licensing subscription content.
Publishers will want to be attentive to how deeply entwined their operations are with Elsevier publication services. What are the other options for developing a robust infrastructure that is also integrated with data analytics and promises improved manuscript placements for scholars and their universities? What sort of infrastructure can support both independent publishers and also provide the scale and reach that would be needed to serve as an alternative to the Elsevier, Digital Science, etc. research workflow platforms? What options do other publishers have as platforms disrupt their access to authors?
These are difficult questions to address. But, we can be certain that, if Elsevier asserts its obvious platform advantages, there is no data firewall that can protect other publishers from Elsevier’s strategic advance.
30 Thoughts on "Advancing an Integrated Vertical Stack of Publication Services?"
If Elsevier or whomever did not provide a service that reduces costs to the user they would not be in business because no one would use the service. Additionally, one signs a contract with Elsevier or whomever and if they don’t like what occurs during the life of the contract can go elsewhere when it expires. Lastly, the assumption that prices will increase as competition decreases is flawed as long as there is competition.
Lastly, the assumption that prices will increase as competition decreases is flawed as long as there is competition.
Competition at any scale does not guarantee competitive prices. Price determination includes many factors, and insufficient competition can result in higher prices. Here’s a study on price increases as a result of insufficient competition in the generic drug market, for example: http://annals.org/aim/fullarticle/2636750/high-generic-drug-prices-market-competition-retrospective-cohort-study. Remember also the attempted purchase of T-Mobile by AT&T back in 2011, which was blocked by the Justice Department because they determined the purchase would result in insufficient competition in the wireless market, leading to higher prices for consumers.
That is so, and I agree that government intervention is needed to prevent laissez faire capitalism. I don’t believe that Elsevier or whomever is in the position of ATT, which by the way is no longer on the DOW!
I had totally forgotten about the blueprint for peer review that Elsevier wrote. I have been pondering centralized submissions lately and I believe it could greatly reduce the redundancies in the system, ultimately requiring fewer participants. That said, it’s a huge editorial shift that I am not sure academics are ready to embrace.
Re academics ready to embrace … maybe not today but in 5 years? So many unthinkable things have become reality.
Lisa’s post and the referrals therein point to the potential of a “central” intelligent clearing house that can sort thru and assign or suggest where an article could be placed for evaluation and “publication”. What is not addressed is the increasing ability of intelligent search by users that locate the articles regardless of where they are published. This leads to:
a) The issue at hand is whither the traditional publisher. AI engines of this type get authors published, ideas accessed and, more importantly can eventually tagged the article with an Amazon type rating. If the article gets routed thru a “peer review” however that is done one can also have such a rating/ranking. Between the two ratings the issue of predatory and pirate sites become visible.
b) Authors want to be published for the traditionally promoted reason of sharing and building knowledge. The unspoken but understood reason is that of promotion/tenure and similar evaluations. Again, a centralized system advantages these major needs but at the expense of the traditional publishing monopsony and thus the current financial models and profitability.
What is clear is that Elsevier is a “first mover” with a model that challenges the very core of the current academic publication industry while potentially controlling the entrants of the predatory and pirates challenging the publishers. For authors it can be exceedingly beneficial as, also, for those who need access.
The comments here, and the links to the other posts point clearly to the fact that this, as with the music industry and other platforms, has the publishing industry in its sights. It seems this option is like headlights shining in the eyes of a deer.
Lisa, you are just givig Elsevier better ideas! Anyway, what happens to author choice in your AI system for choosing the most appropriate journals for publication?
I highly doubt I’m suggesting anything that hasn’t been explored by Elsevier … and other companies developing workflow platforms!
I’d predict that early on author choice is emphasized … here’s our recommendations but you choose. Then flipping to it-will-be-submitted-to-X unless-you-intervene. I think we’ll eventually see this handled by central offices in universities, just like grant submissions.
I am always amazed at how anyone in our industry can make the statement that “Elsevier is no longer a publisher”. Just spend 5 minutes reviewing their financials and one can see that their revenue from publishing is not dropping, that journal publishing is still strong and highly profitable. Take a look at the last 30 years and see the strength of their program. Buying a few publishing platforms or services adds very little to their revenue. In most cases the companies they have bought were offered to the community. Mendeley and bepress were passed around multiple times. Elsevier is not out there knocking on doors trying to buy companies, for the most part companies are brought to them and others. However when they buy a company they invest and improve it. Look at Mendeley, Elsevier has invested and expanded its services. Everyone picks on Elsevier and Amazon as if they are the bad guys, sorry but I don’t buy it. Just because one company has good management and a solid financial base, we get to pick on them. Elsevier has the cash to buy and experiment with various services. Aries offers a critical piece of software that is needed at Elsevier as much as other publishers. It would be a good acquisition even if no one other than Elsevier ever used it. Elsevier will invest and strengthen Aries. Any publisher using the system will get the benefit.
Elsevier itself asserts that a growing share of its revenues — already at approximately 40% — are from activities other than publishing — its much vaunted data and analytics. Yes of course they have an important legacy publishing business. That is not where the the strategy is taking it nor where its strategic investments are being made.
Roger…not sure where you are getting you information. 40% really?
Important to remember that Elsevier is part of the RELX Group which had annual revenue in 2017 of £7,355 million pounds. Elsevier with a revenue of £2478 million pounds generates over £900 million pounds profit. In addition, 72% of revenue comes from subscription sales, 24% from transactional sales, and 2% from advertising. Depending on how they classify sales, subscriptions still generate the lions share of revenue and profitability. Here are the 2017 strategic priorities for their annual report.
“Elsevier’s strategic priorities are to: continue to increase content volume and quality; expand content coverage, building out integrated solutions and decision tools combining Elsevier, third-party and customer data; increase content utility, using “Smart Content” to enable new e-solutions; combine content with analytics and technology, focused on measurably improving productivity and outcomes for customers; and continue to drive operational efficiency and effectiveness.”
The overall adjusted operating margin of 31.1% for the RELX Group was 0.4 percentage points higher than in the prior year. On an underlying basis, including cycling effects, the margin improved by 0.7 percentage points.
Nothing that Elsevier has bought generates an operating margin of 31.1% and it is safe to say that that the publisher services tools and analytical tools are great to improve your internal operation but do little to drive significant revenue compared to content. From my reading of the financial RELX Group is spending £700 million pounds to buy back their stock. Buying a few small companies to improve the workflow is a smart move but does little to improve the bottom line.
Hi Roger, curious where you found information that 40% of Elsevier’s revenues come from non-publishing activities. Can you share? Having worked at Elsevier until the beginning of this year, I don’t recall ever seeing results presented along those lines (i.e. publishing makes up much more than 60% of total revenues of the “Science, Technology & Medicine” division within RELX).
And in response to Dan, I can tell you that many people internally at Elsevier are equally amazed. You are correct that revenues from publishing are still increasing (and contrary to popular belief even subscription revenues) as reported to shareholders every quarter. While I absolutely believe that Elsevier’s data analytics strategy is a very strong one on paper in the long term (and will succeed eventually), the marketing drum that they are an information analytics company and not a publisher is way ahead of current reality (but then again maybe marketing drums usually are…).
I don’t know anything about how Elsevier puts its numbers together, but it is entirely possible that the sale of advertising, which for ELS is significant, is not counted as publishing income but as a service. Of course, a representative from ELS could confirm or dispute this.
I agree it is a matter of definition how the numbers are reported. But according to any definition, income from subscription sales and transactional sales make up much more than 60% of Elsevier’s total revenues. As for the example you mention, what I know is that pharma sales have been declining for many years now and total advertising sales make for a single-digit percentage (as Dan seems to have investigated in more detail above). All these numbers are publicly available by the way.
RELX Group, Elsevier’s owner, has been busy exiting advertising-related assets for many years. In 2000, they represented 15% of revenues and in 2017, just 1%. https://www.relx.com/~/media/Files/R/RELX-Group/documents/investors/relx-overview-august-2018.pdf – page 9. In 2017, advertising represented just 2% of Elsevier’s revenues (page 14). On page 24, you can see the breakdown of Elsevier’s revenues by primary research (subscription and transactional); database tools and electronic reference; print books and pharma promotion.
PS: I work for Elsevier’s parent company, RELX Group.
Thanks Paul. Maybe the disconnect is what counts as publishing/ being a publisher. Databases aren’t usually enough or I’d think Clarivate would get pushback on its claim that it is not a publisher. I suspect this is Roger’s source: https://twitter.com/TomReller/status/1016684638549479425?s=19 … though I don’t know if he had other data to share as well.
“While I absolutely believe that Elsevier’s data analytics strategy is a very strong one on paper in the long term (and will succeed eventually), the marketing drum that they are an information analytics company and not a publisher is way ahead of current reality (but then again maybe marketing drums usually are…).”
This is exactly the point. Other publishers can’t afford to wait until Elsevier succeeds to react if they want to engage thks shift strategically. They need to be positioning themselves now.
The idea of the academic journal was, at least originally, to expedite sharing of scholarly research, particularly in, as SK and SSP is concerned, the STEM arena. This thread and that of Rick’s recent posting (and responses) seem particularly, and probably rightly, so, about the potential disruption of the publishing industry itself. The efforts of Elsevier seem to be the trigger and concern.
This seems strikingly familiar to the music industry and also the rise of Amazon in books and “everything”. The issue at hand is whether this, as seen from these examples, will be of major benefit to the “consumer” in the form of scholars as authors and consumers and problematic for the future of the publishers.
The arguments in this thread, Ricks and others, and rightly so from an SK and SSP perspective, is on the fate of the publishers. If the music industry and the global merchant platforms such as Amazon, Alibaba, TenCent and others point out, the consumers tend to benefit.
Thus, a discussion would seem to be most beneficial if the publishers would start to figure out their future rather than ululations post Elsevier.
Probably worth noting that this piece was written by a librarian, not a publisher, and if you read all the way through to the end addresses the potential impacts on libraries and scholars.
Thanks Lisa for this thought-provoking post. Extrapolating further on the “vertical stack” principle, one might argue that we could then also do away with the concept of a ‘journal’ altogether. The central submission system would then simply be the portal to a database which hosts a vast collection of articles which together make up the scholarly record. Far-fetched? As Angela Cochran points out above, I think it is questionable whether the academic world would be ready to embrace such a major paradigm shift (and it wouldn’t exactly be great for publishers either unless you are the one that controls the portal!). Author choice still counts and so does branding. I am not sure if it is realistic to expect that we can move away from that (maybe if journals are consolidated across multiple portals – say publisher databases – so that author choice and brand still play a role to some extent; though I would not want to be a small publisher in that reality…).
As your comments, that of Angela, Lisa and mine point towards, the issue, as with music and retail platforms, is with the fate of publishers, particularly in an industry that is still caught in the “hand-crafted” era of an emergent digital world.
The issues regarding author choice and acceptance are moot since such a system could offer author choice, probably more, and more efficiently than the current submit-reject-resubmit process today. In fact raising the issue and others here are more like the standard model of resistance to innovation of which there are several paths.
Since it is becoming clear as to such a potential and benefits, it might be of interest to explore on SK how a post disruption publishing industry might look like
We can absolutely see a path that gets rid of journals, at least as currently conceived. I mean, really, to take a small thing … why are we hanging on to volume and issue numbers? The look on students faces when I have to explain how things were published and mailed in print… I usually bring a copy to the classroom because it’s ancient history to them … we examine an artifact to understand it!
I have been heading a lot of discussion from editors and other people who are close to researchers about changes in peer review. One of the changes most often discussed is reducing the wasteful re-review of manuscripts & there’s growing acceptance of review decoupled from the journal.
Speaking from my own personal perspective only, it makes more sense when submission is also decoupled. There are all sorts of inefficiencies in the publication process that will be improved upon & there will no doubt be all sorts of hand-wringing about what it all means, but let me emphasize that services are fundamentally different market goods than content, because they’re rivalrous with other services (such as those from Clarivate, Digital Science, etc). That’s why thinking about Elsevier as just a publisher leads to poor predictions, whatever the current revenue breakdown is.
The value of interoperability is well understood at Elsevier and many Elsevier services play well with others. Contrary to the lock-in narrative, I expect this to continue & increase.
I’m still struggling with the general concept of eliminating redundancy from the scientific process. To me, redundancy is a feature, not a bug to be eliminated. Redundancy is important — it helps ensure that a researcher’s work gets a fair shake, and it helps us sort out ideas that are wrong from ideas that are correct but failed due to faulty implementation.
Multiple rounds of review is not wasteful, but an important part of the process. Very few papers are perfect upon submission. Most could be improved in some way, and if this is significant, then more review is necessary. If the paper is substantially re-written to meet the needs of a different type of publication, or if new data is added, or claimed conclusions are changed, it likely needs to be re-reviewed. Any system that limits a researcher from substantially improving their publication is problematic. Any system that immediately slots a paper into a particular journal (against the author’s wishes) with no chance for that improvement and the ability to get it in front the right audience, is problematic.
If a researcher submits a paper and gets what they feel is an unfair review, being able to submit it elsewhere and have it looked at with fresh, unbiased eyes, is very important. Any system that relies upon a single point of submission for all works would fail this researcher.
Similar arguments arise around negative results. When an experiment fails, we don’t know if it is because the concept being tested is wrong, or if the researcher made mistakes. If we see negative results and immediately assume that there was no researcher error, than many good ideas will go unexplored, many new discoveries will be blocked. Again, having multiple attempts by multiple researchers at compelling ideas is not a bad thing that should be eliminated.
Scientific progress may require some redundancy, and perhaps that should be recognized and accepted.
Springer uses some of the same techniques. Your faculty member submits an article to Nature, and Springer out of the kindness of their heart recommends you instead publish your article in the Springer Journal of Natural Science. So convenient. But it prevents the faculty member from truly shopping around their work.
When the US automobile industry was challenged by the Japanese imports, the response was the equivalent of adding larger tail fins (current publishers just add more journals) and then to copy and finally to adopt. Scott’s last post regarding Nature and a number of others throughout these responses, particularly to Elsevier, point to a shifting model. One post even suggests 5 years for “consumer” acceptance. I don’t believe that Elsevier and Nature are “weak signals”, nor are they disruptive like a “wild card” or a Black Swan. With the increasing capabilities of Watson and children and the appearance of similar systems with other features outside of the scholarly publication, academic publishers, as they say, are living in interesting times. OA, predatory publishing, pirating of articles, weariness of the “big bundle, and other such “affronts” to the current model also point to the fraying on the edges and the developing cracks.
Nature/Springer/Elsevier…. Who’s next and what will the playing field look like 5 years hence?
Thank you for a thought-provoking article. The only aspect that perhaps doesn’t have a place in this discussion, but that I would still like to add, is Elsevier’s developing of the research management system PURE–
“Pure aggregates your organization’s research information from numerous internal and external sources, and ensures the data that drives your strategic decisions is trusted, comprehensive and accessible in real time.”
(For an idea of what it entails, see e.g. https://www.elsevier.com/solutions/pure/researchers)
From anecdotal evidence, this seems to be gaining ground, especially among data-driven and impact-hungry institutional higher management — the exagerration here being purposeful to note that there tends to be a (vast) gap between the agenda and goals of librarians and university libraries, and that of university management.
The development and exploitation of PURE does strengthen Elsevier’s move beyond publishing services altogether. While I suspect PURE today is still a small part of its revenues, it will be interesting to see what the implications of this new type of product and especially, these “new” customers are in the long run.
Absolutely has a place in this discussion imo, since PURE appears to be a part of that stack considering how neatly it fits into the workflow envisioned by Lisa: authors deposit their work into their instituional PURE (which already employs E’s fingerprinting engine if memory serves me), from there it’s fed into EM where a suitable journal for the work is automatically identified and submitted/cascaded to.
And I’m pretty sure authors would love such a workflow.