Date:         Fri, 26 Jan 1996 14:56:15 EDT
From: W Ted Rogers <WTR100F@ODUVM.CC.ODU.EDU>
Subject:      JOURNALS INFLATION (fwd)

Although I am not a publisher, I would like to make one fundamental
observation. Using Keith's formula and assuming that the cancellations
are due to the price increases, the publisher should be aware that
the end result is the number of subscribers decreases to zero which means
the journal in question goes the way of Studebaker.

W Ted Rogers, Serials Librarian  <wtr100f@shakespeare.lib.odu.edu
Old Dominion University Library  <wtr100f@oduvm.cc.odu.edu
Norfolk VA 23529-0256  USA
----------------------------Original message----------------------------
---------- Forwarded message ----------
Date: Fri, 26 Jan 1996 13:21:55 GMT
From: Keith Renwick <KDRENK@FS3.LI.UMIST.AC.UK>
Subject: JOURNALS INFLATION

One aspect of the journal inflation problem has not, as far as I am aware,
been investigated or costed, yet is fundamental to the situation in which
librarians find themselves.

Each year an unspecified number of libraries cancel journal subscriptions,
often the more expensive titles (partly because savings are easier to
achieve with the minimum amaount of effort). It also seems to be the case
that the more expensive the journal, the higher the increase in
subscription price. Is this due to the fact that more expensive titles
have higher overheads or are published by the multinationals?

An undisclosed proportion of our subscription increases are due to
cancellation of subscriptions and the increased unit costs which ensue
from that. Faxon have indicated in their recent projection for 1997
subscriptions that cancellations will account for around 4.5% of
subscription increases next year. Has anybody projected this for a few
years ahead to calculate the increasing cancellation element of
subscription price increases?

[text deleted]

Keith D. Renwick,
Head of Technical Services & Administration,
UMIST Library & Information Service,
P.O.Box 88,
Manchester M60 1QD.
Tel : (44) 161-200 4940
Fax : (44) 161-200 4941
E-Mail : K.Renwick@umist.ac.uk
----------

Date: 26 Jan 96 18:47:19 EST
From: Albert Henderson <70244.1532@compuserve.com>
Subject: JOURNALS INFLATION (fwd)

I would like to comment on the article on journals inflation.
Keith Renwick <KDRENK@FS3.LI.UMIST.AC.UK> had written the following:

> One aspect of the journal inflation problem has not, as far as I am aware,
> been investigated or costed, yet is fundamental to the situation in which
> librarians find themselves.

> Each year an unspecified number of libraries cancel journal subscriptions,
> often the more expensive titles (partly because savings are easier to
> achieve with the minimum amaount of effort). It also seems to be the case
> that the more expensive the journal, the higher the increase in
> subscription price. Is this due to the fact that more expensive titles
> have higher overheads or are published by the multinationals?

The relationship has to do with the large number of pages found in many
expensive titles and/or the very specialized nature of the publication. National
association publishers, newsletter publishers, and single-title publishers are
not excluded. Higher overheads may be associated with publishers that have paid
full-time employees, multinational offices, no tax exemptions, no page charge
subsidies, and high frequency of publication.

> An undisclosed proportion of our subscription increases are due to
> cancellation of subscriptions and the increased unit costs which ensue
> from that. Faxon have indicated in their recent projection for 1997
> subscriptions that cancellations will account for around 4.5% of
> subscription increases next year. Has anybody projected this for a few
> years ahead to calculate the increasing cancellation element of
> subscription price increases?

Based on economic research done by Donald W. King in the 1980s (which probably
should be updated) the formula to adjust for cancellations alone -- all other
factors being equal -- is  y = IUC, where I = the percentage of sales income
derived from subscriptions; U = the estimated net loss (or gain) in sales units
divided by the net units retained; and C = the percentage of fixed costs of the
total costs. See my article in Serials Librarian 21,4 (1992):33-43 on
forecasting changes in periodicals prices. A further article on pricing of
foreign science journals appeared in 23,1/2 (1992):129-134.

I hope that's helpful.

Albert Henderson, Editor, PUBLISHING RESEARCH QUARTERLY