The transition to Open Access: financial implications

Kyle Brady
Thursday 1 February 2018

In our last post we discussed the headline figures disclosed in a recent report by Universities UK on the transition to Open Access. The post paid particular attention to download figures for open access content which look particularly rosy! In this post we’d like to look at some of the cost implications of this, and show some of the complexity highlighted in the report relating to the financial side of open access.

CC BY-NC. Universities UK. Monitoring the transition to open access: December 2017

The above graph shows the total APCs (Article Processing Charges) paid by 37 UK institutions. On the surface this graph appears to show us what we probably already know – those that process a lot of APCs will also spend a lot on APCs! What the report also shows here though, and something that isn’t discussed in the report, is the importance of stretching budgets to achieve greater numbers of open access content, i.e. keeping the bubble small while rising up the y-axis. This appears to be something University of Glasgow have managed to achieve (bubble 02). The report doesn’t give any detail on specific institutions here, so we can only speculate as to how University of Glasgow has achieved this, and indeed it may just be down to the way they have recorded their APC expenditure. Nevertheless, one way institutions may seek to minimise spending on APCs is by taking advantage of deals offered by publishers, these may be prepayment deals or one-off payments in return for a percentage discount on the APC charged. A list of current membership deals for University of St Andrews authors can be found on our Open Access webpages.

CC BY-NC. Universities UK. Monitoring the transition to open access: December 2017

The graph above shows the expenditure of 37 UK institutions on both APCs and subscriptions to 7 publishers. Across the 37 institutions £67.4 million was spent on APCs and subscriptions to the 7 publishers listed, and 20% if this figure was on APCs, the majority of which went to hybrid journals. This financial picture is made more complicated by off-setting deals which seek to mitigate ‘double dipping’, i.e. charging for access to open access content that has already been paid for via an APC.  So one might expect subscription costs to be lower in 2016 given the APCs paid in previous years, but looking at the graph above it is clear this isn’t happening. The report authors go on to mention a number of ways that the financial data presented may be obscured by institutions’ accounting for offsetting in different ways in their financial reports, but they also state that the deals may have merely shifted the goal posts:

[A]n increase between 2013 and 2016 of 20% in expenditure on subscriptions by our sample universities to our seven publishers has been accompanied by the development of offsetting deals and similar arrangements which provide for reduced or zero payments of APCs. Some of the costs associated with Gold OA are thus often shifted onto subscriptions.

The report also points out that the UK pays more APCs for hybrid journals than the global average. This will partly be due to the fact that the research funder RCUK has a preference for Gold open access, and provides funding to many UK institutions to pay for this. This UK preference for hybrid is set to decline however as many UK institutions have recently stopped paying for hybrid gold as RCUK funds have started to run out. One of the first Universities to report that they were stopping hybrid gold APC payments was University of Oxford in August 2017, and many others have followed suit since.

CC BY-NC. Universities UK. Monitoring the transition to open access: December 2017

At first glance the figures above might be seen to show little change overall in the publishing habits of UK authors, but there are positives to be gleaned. In Medicine & Life Sciences, Physical Sciences and Engineering, and Art and Humanities we can see that fully open access journals are gaining ground. In the Social Sciences there appears to be a marked jump in the popularity of hybrids at the expense of subscription only journals, but this may just be caused by journals adopting a hybrid approach to publishing or having been bought out by a larger publisher that offers a hybrid gold open access option. This also tallies with an earlier point in the report where the authors state that the number of  subscription only journals fell by 37% percent between 2015 and 2017. This fall may be a result of a market shift to take advantage of the potential new revenue stream from APCs. Whatever the reasons, an important potential consequence of this is that more hybrid journals could mean the UK will pay more for OA. This is because hybrids on average charge more for APCs than their fully open access cousins. Roughly speaking hybrids charge on average between £1,500-£2000 with some charging upwards of £4000. Fully open access journals typically charge between £500-£1500. Part of this difference is down to hybrids having to integrate an additional funding model into legacy systems.

CC BY-NC. Universities UK. Monitoring the transition to open access: December 2017
CC BY-NC. Universities UK. Monitoring the transition to open access: December 2017

Figures 4.5 and 4.7 above are particularly interesting because they show the results of Springer’s recent efforts to increase its open access portfolio.  As the report authors note, the rise in the number of APCs is in part due by the publisher’s acquisition of the open access publisher Biomed Central as well as a merger with Nature Publishing Group, which publishes two major open access mega journals – Nature Communications and Scientific Reports. Springer (or rather Springer Nature as they are now called) far out-paces the competition in terms of numbers, as can be shown in figure 4.5. This is also likely to be a consequence of a particular off-setting deal called the Springer Compact – a UK wide deal brokered on behalf of UK institutions by JISC. This deal gives UK corresponding authors the option to publish open access with a CC BY licence at not additional cost. Libraries do pay however as an upfront cost included in subscription price.

For many years UK academic libraries have worked together to broker better subscription deals with publishers. And indeed Scottish institutions have led the way in this, forming SHEDL in 2009 – the first purchasing consortium of its kind in the UK. Increasingly over the past few years we have seen this consortia approach feed into open access expenditure too, providing better value for money to institutions.

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