Editor’s Note: Tao Tao is an independent consultant focusing on the Chinese academic market. She has worked in the scholarly publishing industry for 25 years, starting as an associate editor of Chinese Medical Journal, the oldest academic periodical in China. Later she joined The Charlesworth Group, a UK publishing services company, and helped establish their first overseas office in Beijing. Fifteen years as the General Manager of Charlesworth China and four years as Vice President China Sales Charlesworth USA have given Tao a good understanding of both sides of the Chinese academic market.
Matthias Wahls has accumulated 20 years of experience in the international academic publishing industry. After 11 years working for Elsevier Science and Brill Publishers, he founded his own consultancy company in 2010, which has successfully served a number of European publishers for their China endeavors.
On November 13, 2019, Edition Diffusion Press Sciences of France (EDP) became a wholly-owned subsidiary of CSPM Europe, a subsidiary of Chinese Science Publishing and Media (CSPM). This deal is regarded as a milestone in Chinese STM publishing, marking an important step in its internationalization progress. Dr Matthias Wahls was involved in this deal at its early stage, and shared his insights in this interview.
Tao Tao: What are your activities in relation to China’s STM publishing industry, and what can you tell us about the landscape of Chinese STM publishing?
Matthias Wahls: As an independent consultant since 2010, and prior to that as Brill’s Business Development Manager China (2004-2009), I have guided many Western academic publishers into the Chinese market and collaborated with a few Chinese academic journal publishers including Science Press, Higher Education Press, etc.
I witnessed the very first steps of the Chinese publishing industry under the Going Global Initiative (GGI) which was released in 2004/05. In China’s attempt to export to the world its culture, language, and R&D, the publishing industry is regarded as a vehicle to support the aim of letting the world know better about China, besides other vehicles such as massive crowds of students and researchers in international universities, establishment of cooperation between Chinese and Western universities, and probably also the establishment of many Confucius Institutes all over the world. The GGI was meant to stimulate all sorts of international cooperation and co-publishing activities in the Chinese publishing industry which previously was focused on domestic market of China.
There are only a few hundred Chinese STM journals published in English, and the majority of them are in all sorts of publishing arrangements between universities, institutes and societies, and the known Western publishers, with the Big 4 (Elsevier, Springer-Nature, Wiley, and Taylor & Francis ) taking the biggest share.
As I understand, you introduced China Science Publishing & Media Ltd (Science Press) and Edition Diffusion Press Sciences of France (EDP) to each other at the very beginning. What can you share with us about the Science Press – EDP Sciences deal?
The deal was a full acquisition of EDP Sciences by Science Press and the latter paid approximately 12 million Euro. My understanding is that Science Press will keep EDP Sciences intact, and won’t strip it down for its assets, as other Western publishers may have preferred to do. This is particularly interesting, as it may shed some light into future mergers and acquisitions of the same type. It may answer the question whether being taken over by Chinese is more of a threat or an opportunity. In the West, not much attention has yet been paid to this deal — which, in my opinion, has the potential to influence the current landscape of academic STM journal publishing significantly.
What was the biggest challenge in the negotiation of this deal?
From what I can see, a major challenge was the complexity of decision-taking processes on the Chinese end. These complexities resulted in a rather lengthy process, which would – I believe – have failed for Science Press, if there had been other serious and competitive offers on the table (which there may have been, but I don’t know for sure).
What does this deal mean to China STM publishing?
For China, and for Science Press in particular, this acquisition may open the door to the international STM publishing world.
China’s (STM journals) GGI is probably best understood through a 3-step model: Step I is co-publishing with international publishers (“setting out on a borrowed boat”); step II is the establishment of international offices, such as PPM International (London) Ltd which was established in 2012 by Phoenix Publishing & Media Group (“setting out on a self-built boat”); and step III is merger and acquisitions (“setting out on a purchased boat”).
I would classify all journal cooperation arrangements between Chinese presses, universities, institutes and societies, and international publishers, as Step I of the GGI, as they are at the ‘standard copyright trading level’ where the Chinese publishing house as the proprietor transfers the international copyright of its publications to an international/foreign press, who then takes on the international publishing and distribution (outside of China) on behalf of the Chinese proprietor.
While Science Press is already one of the most powerful and influential academic publishers in China, its impact had been mostly inside China. It made a significant step towards international impact by establishing a joint venture “KeAi” with Elsevier in 2013/14. I regard KeAi as the first important engagement of a Chinese press at the Step II level of GGI, although strictly speaking it is not ‘a self-built boat’, as KeAi is making use of Elsevier’s digital platform, ScienceDirect, to host all its journals. Science Press and Elsevier may be satisfied with the achievements of KeAi which now publishes over 50 titles in year 6.
This acquisition of EDP Sciences with its own working infrastructure, however, could be the very first engagement of a Chinese publishing group outside China under the Step III level of the GGI. It is not the first acquisition, but, I believe, the third by a Chinese press. The first such deal was the acquisition of Canadian publisher B. C. Decker by the People’s Medical Publishing House in 2008, and the second was the acquisition of the US children’s books giant Publications International by Phoenix Publishing & Media Group in 2014. In academic/scientific publishing, which nowadays seems to be very much on the strategic radar of the Chinese government, the Science Press/EDP Sciences merger is definitely the very first. I am delighted to have been involved in this milestone of international publishing from the very start of the process.
I believe if Science Press manages the integration of EDP well and follows international habits and standards of STM publishing, it may draw valuable international know-how into its own organization. Eventually, Science Press may become a true international STM journal publisher from a Western point of view. Except for its joint venture KeAi, Science Press is more recognized as a domestically focused press with authorship largely based in China and a small part from developing countries. To become a true international publisher, Science Press needs to attract wider range of authors including those from developed countries.
Most recently, both the Wiley and Springer-Nature agreements with Projekt DEAL in Germany marked the first country-wide solutions for open access publishing, which could be copied by the Chinese government and its research organizations. If that will happen, and I believe it will, Science Press will become a strong competitor by offering services tuned to Chinese needs, lower APCs, and international exposure through EDP. There may even be policies mandating authors to publish a certain share of their output with Chinese presses. Sooner or later, the Impact Factor (IF) obsession in China will also fade away, when the Chinese evaluation systematics is moving away from the IF-only metric evaluation. It is not difficult to speculate that Chinese presses will win the battle for those publishing budgets, sooner or later, for they understand better the needs of Chinese authors. Besides, political factors, for example, protective mandatory policies, will be at their advantage.
The author-pays model allows the Chinese to enter the international market more easily. Through open access publishing, Chinese money will stay in China. There are plenty of other businesses where you can see similar developments. The question is when, not if. The big-4 will face a declining market share in the future.
Potentially, Science Press could become a Top-10, maybe even a Top-6 publishing group internationally, if it manages this acquisition the right way.
I watched many Science Press managers in my close networks in China, and hope they are passionate and capable of undertaking this long march to the Top-6. But as we Westerners have a rather different view of urgency from that of the Asian (business) culture, I could not speculate on any realistic time lines.
What does this deal mean to the rest of STM publishing world, in your opinion?
For EDP, this deal is likely to offer more opportunities than threats. As Chinese enterprises are usually known for their approach of keeping acquired businesses more or less in their established shape, I believe EDP will be able to continue its core business as before. They will also become ‘more Chinese’, as will their journal and book portfolio, which I see as more of an asset than a liability. China is already a powerhouse of science and technology research in the world, and has recently surpassed the U.S. in the number of papers published. China is not yet among the highest-output countries in terms of quality papers, measured by average citations per paper. However, in terms of quantity, China is the most productive and has been there for a while already. (It is worth noting that there are somewhere between 4000-5000 Chinese language STM journals in addition to the several hundred English-language ones. People in the West tend to overlook this huge reservoir of content!)
Whether this merger will turn out to be a true win-win, we will see, perhaps by 2025. But the ingredients for success are available and in the hands of both sides. In the end, the customers, whom we publishers serve, will decide. Libraries and their readers, and the Chinese and international scholars as authors, will be key to Science Press’ success as an international publisher.
I expect that at mid- and long-term (10-25 years), the Chinese publishing industry will actively co-define the standards of future academic publishing. The current standards of publishing are mostly set by the Western world, which is often seen as unfair by non-Western participants; for example, English is effectively the lingua franca of STM publishing, and Impact Factor metrics are controlled from the US.
Do you know or see more such deals in future?
There are always rumors about more of these takeovers, so let’s wait and see!