EDI Special Events and Conferences Library/Publishing Standards Price Projections US		Industry Resources Price Projections US 2001 Preliminary Price Projections 2002 Preliminary, 2001 Preliminary, 2000 Actual, 2000 Preliminary, 1999 Preliminary, 1998 Actual, 1998 Preliminary, 1997 Preliminary, 1996 Actual Based on discussions with publishers and on the latest information on publisher price changes, world economic conditions, the current and projected values of the U.S. dollar, and the latest electronic journal trends, Faxon, Rowecom is projecting an approximate overall increase of just over 10% for a sample journal collection. This estimate is based largely upon our expectation that paper prices will increase slightly, the U.S. dollar will remain strong against all major currencies (including the Euro and the British pound sterling), and that other key factors will remain much the same as for 2000. Please note that these are preliminary projections based on current conditions and information and are subject to change as the year progresses. Publisher located in North America Continental Europe U.K. Other General Inflation 2.5% 2.5% 2.5% 3.0% Publishing Factors Paper 2.0% 2.0% 2.0% 2.0% Postage 0.5% 0 0.2% 0 Page/Volume Increases 2.8% 3.4% 3.3% 3.0% Cancellations 2.2% 3.50% 3.0% 2.0% Currency 0 0 to -1% 0 to -1% 0 to -2% TOTAL 10% 9.9 to 10.9% 10.0 to 11.0% 8.0 to 10.0% Sample Collection Increase: % of Budget $ x Increase = Total North America 50% x 10.0% = 5.0% Continental Europe 30% x 9.9 to 10.9% = 2.97 to 3.27% U.K. 15% x 10.0 to 11.0% = 1.5 to 1.65% Other 5% x 8.0 to 10.0% = 0.40 to 0.50% TOTAL 9.87 to 10.42% To determine the overall increase for your collection, multiply the % of Budget $ of your collection for each category above by the Increase listed, and add the resulting numbers as illustrated above. Key Assumptions Paper and postage: Although the increase in the number of electronic journals has been dramatic over the past year and will continue to rise in 2000 and 2001, most subscriptions are still either paper only or electronic bundled with paper. Thus, the costs for paper and postage continue to be a factor. Paper prices have remained stable since 1994/95, when a substantial increase occurred. Printing sources indicate the price change for 2001 may well fall short of the expected general inflation rate. Postage: The U.S. Postal Service has applied for a significant rate increase for 2001: an average of 15% on periodicals and 5% in general library rates. The Magazine Publishers of American have announced a $10 million campaign to reform the U.S.P.S. and fight the rate hike. Regardless of the outcome, either the rate hike itself or the costs of the battle are likely to impact serials prices. In the UK postage is expected to rise by 2-5% as it did in '99. Page/Volume Increases: As prepublication on the web and article-by-article posting expand, so too are the pages and volume of printed material likely to increase. Until the journals switch entirely to electronic publication, this pressure to publish will result in higher costs for additional content. Cancellations: Subscription cancellations will continue to affect publishers' pricing models. We are projecting slightly higher impact for cancellations of European (including British) journals because of their generally higher prices. We will monitor this factor closely throughout the year, especially as publishers analyze their 2000 renewal rates. Movement from print to electronic format may offset the cancellation rate slightly, but publishers will also be factoring in changes in revenue streams resulting from consortial sales and from any trend towards document delivery or pay-per-view in lieu of subscriptions. In addition, to prevent the erosion of subscriptions, some publishers are offering low price increases in exchange for guaranteed 100% renewals over 1 or more years, or for purchase of journal packages. Currency: We expect the US dollar to continue its strong position. Current projections in the financial markets suggest that the key currency exchange rates will see relatively little change over the next year. The effect of the Euro has stabilized the European currencies with regard to each other, and may thus even out the more extreme swings in exchange rates among the major currencies, including the U.S. dollar. Electronic Journals: Pricing models for print and electronic journals are likely to continue following a few basic patterns: bundled (electronic included with print, or more recently print included with electronic), electronic-only at a modest discount from the print price, and a combination at a modest premium over either print or electronic alone. What we're also beginning to see this year is various pricing models for the same material from one publisher. As an example, a publisher might offer titles on a free with print basis for a one-workstation license; for a site license, the price is significantly higher. The logic from the publisher's perspective is that limited experimentation with providing electronic resources should be freely encouraged whereas serious initiation of electronic services for a library's end users implies that the library is ready to acknowledge that these resources have a value. We compared the percentage of free with print titles in License Depot before we started adding 2000 pricing and after. In the Fall, free with print titles made up 45.2% of the LD database, whereas in the end of March 2000, free with print titles make up 45.6% of this database. In that time period, we've added about 400 new titles to the database, but the percentage is still holding relatively steady. The final report on Elsevier's PEAK experiment is due in 2000, which may suggest other ways of purchasing content. Publishers are also exploring variable pricing based on previous or expected usage, or type and size of institution. The trend id likely to become more significant in the coming years. Librarians contemplating a choice between maintaining print and switching to electronic only subscriptions have been concerned about the archiving of these journals. As more publishers issue guarantees of long-term access capabilities, though perhaps at some additional cost, librarians may feel more comfortable making this switch, for enhanced access and a price incentive. The effects are more likely to be seen in 2002, however, since publishers do not expect the balance to tilt to electronic-only in 2001. As publishers evaluate usage patterns and subscriptions in the early part of 2000, pricing trends may become clearer. Faxon, Rowecom will continue to monitor publishers' pricing models closely and update its price projections accordingly. General Inflation: While contributing to overall price increases, inflation, particularly in the U.S., Canada, and Western Europe is projected to remain at a moderate and consistent level into 2001. Other factors: The ongoing consolidation of publishers via mergers and buyouts may affect prices, but it is not clear what effect they will have. In some cases, particularly in the short term, any efficiencies expected from scaling are initially offset by costs of conversion and realignment. In other cases, these efficencies may be realized quickly. New publishing ventures, such as the SPARC initiative, are not likely to have an immediate effect on prices in general, although publishers will be following their progress and success with interest. And finally, 2000 is a U.S. election year, which is a quadrennial wild card.
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