Re: Response from Ted Bergstrom to Ann Okerson

[Ann Okerson <ann.okerson@yale.edu>]

Phil, I see the situation differently from what's described below and by
others who have posted on this thread.  My perspective comes from nearly
10 years of steadily working on/with/signing contracts for both Yale and
for the NERL consortium, having now dealt with hundreds of these.

1.  Non-disclosure of terms was a much bigger issue in the "early" days,
i.e., a decade ago, than it is today.  I'd guess that relatively few of
our contracts now have such clauses -- of the hundreds of licenses in
effect at this time.  Non-disclosure is to be resisted, and the library
community has done so with increasinlgy good effect; publishers have
"lightened up" on this as on so many other contractual issues.  We've all
come a long way since that initial Academic press contract of 1996 --
though I'm not sure AP is a good example, since I can't attest that it
asked for non-disclosure! Anyhow, I no longer see non-disclosure as that
much of a "last frontier of licensing."

2.  Many or most of our e-journal packages are licensed consortially. My
perception is that in nearly all cases we've negotiated within standard
frameworks or models offered by the publishers, and these are available to
all consortia in much the same way as to NERL.  For example, one chooses
whether one wants e-only, e- plus print; AND the entire package, selected
subject packages, or individual titles.  Those basic choices are most
often (though not by all publishers) tied to cost of titles a library used
to take in print (that is gradually changing but very gradually and we
need newer, better pricing models for this, which would eliminate the
construct of 'list price' altogether).

The consortial pricing variations arise depending on a few factors, the
*most* common of which are probably (this list isn't exhaustive):

* length of contract the group is willing to sign, with slightly better
discounts for longer contract (last time Elsevier gave our consortium a
chance to mix contract lengths so members within the arrangement could
pick 1, 3, or 5 years, as they wished).  Longer periods were worth -- if I
recall -- 1/2 percent discount off the e-fee.

* how many members or FTE join the contract.  More customers might yield
another 1/2 percent discount than fewer.

* sometimes we can get small libraries really good deals on contracts, --
libraries that have not been able to be customers -- for a token price for
the full resource set.

None of the above are particularly mysterious or secret, so I don't
imagine that either as a Yale librarian or moderator of this list I could
possibly be hauled off to the pokey for divulging trade secrets or
engaging in restraint of trade practices.  I'm not sure I know trade
secrets!  The great majority of publishers wish to be seen to deal with
library customers consistently and fairly and evenly.

A final point re. sharing pricing information, as several on this list
have advocated:  This is complicated, but not for reasons of secrecy.  
Imagine a situation wherein NERL negotiates an all-journals contract with
FRED'S PUBLISHING, INC for our 26 core members and 44 affiliate members.  
(BTW, In our consortium, only libraries who wish to sign on for a license
do so -- others do not; there is no obligation for all to join.)  So, some
of our contracts have had 3-5 takers; others have had close to 100%
participation.

The pricing for FRED is calculated something like this:

1.  Yale takes 200 of FRED's 500 subscriptions in print.  Yale's price for
e- and p- is now calculated at the list price of the 200 subscriptions
plus a 7% surcharge for access to the entire rest of the package in
electronic format.  Result is e-access to all 500 titles plus the ones the
library wishes to keep as print.  (This access to the full 500 is much
cheaper than the labor cost of sending articles around via ILL so there's
an offsetting savings on the backroom processing costs.)  Contract allows
move to e-only for 95% of print price, and let's say that Yale might
decide do to that in the second year of the contract.  If/when we do this,
we will reap a 5% one-time savings off our overall pricing with FRED.

2.  Smaller-NERL-Member than Yale takes 76 of FRED's 500 subscriptions in
print.  Smaller's price for e- and p- is now calculated at the price of
the 76 print subscriptions plus a 7% surcharge for the entire rest of the
package in electronic format.  Smaller now decides to drop all its print
subscriptions, so the net result for Smaller is the price of the 76 print
subscriptions minus the 5% for e-only.

3.  NERL affiliate (really small member) takes only 5 of FRED's 500
subscriptions.  Affiliate's price is now calculated at the price of the 5
print subscriptions plus either a surcharge for its existing print or a
discount of 5% if it drops the print entirely.

So, each library that chose to sign onto the package has gotten e-access
to 500 titles; the prices each is paying for those 500 titles are indeed
different, being the prices for what they'd previously chosen to afford in
print and modified by length of contract and whether they change to e-only
or not.  Maybe the consortial negotations have gotten some concessions on
a reduction in backfiles pricing, or some other adjunct terms.

The deal is concluded and then NERL is billed by the publisher for the
libraries that have chosen to sign up.  Let's say that's 14 libraries and
the bill is -- hypothetically -- $1/2Million, which is apportioned among
the libraries in our group as per original calculations for their "print
spend."  I'm not asserting this is or is not the perfect contract -- only
that it is, for this moment in time, a somewhat typical one.

What I've been trying to say in my previous message and in this one is, I
don't any longer know how to (by what groundrules) calculate the price per
title under such a consortial package deal.  The calculations could be
done, of course.  The challenge is how to make and present these
caculations in ways that make sense and have meaning.  Even when one does,
they won't be comparable to pricing for other libraries in other
consortia.  This difficulty is in no way related to secrecy about pricing.

Also, as an aside, in the above scenario, the libraries are generally
satisfied with value and terms/conditions. Where -- as all librarians
point out -- we become cranky (justifiably cranky!) is if we want to
change subscriptions, or particularly, downsize the package.  Then the
same flexibility that has become ours through taking "everything," can
begin to become a liability.

Fortunately, package publishers pretty much let us swap out titles within
these arrangements, but generally dollar volume has to be maintained.  
Fewer allow us a cancellation rate during the term of the contract or
between contracts, though some do; and still fewer consortia have found a
way to negotiate orderly downsizing.  OhioLink is the one consortium known
to me to have had some success.  (See
<http://www.dlib.org/dlib/october04/gatten/10gatten.html>)

Others of us persist in trying and regard package downsizing as one of the
"last frontiers of licensing."  Like the other frontiers that have been
addressed (many with success), it will be resolved in useful and creative
ways.  At least, that's one of the (many) challenges that keeps me coming
to work each day.

Cheers, Ann Okerson/Yale Library


>Phil Davis wrote:
>
> At present, electronic subscriptions are bound by a legal obligation
> between the publisher and each institution (or consortium if it is signing
> on their behalf).  I am not talking about willfully ignoring these
> contracts, yet it is important for libraries to resist confidentiality
> clauses that prevent them from sharing details about cost or use with
> other institutions.  Without the ability to share and aggregate data from
> other institutions, we will all find ourselves paying more money for less
> information than if we openly shared information. Those institutions that
> belong to open-records states or have not already signed confidentiality
> clauses are in an ideal position to provide the initial leadership for
> this project.
> 
> --Phil Davis