PII: 0364-6408(86)90002-5 Librwy Acquisitions: Practice & Theory, Vol. 10, pp. 183-197, 1986 0364-6408/86 $3.00 + .OO Printed in the USA. All rights reserved. Copyright 0 1986 Pergamon Journals Ltd. BRITISH JOURNAL PRICING: ENIGMA VARIATIONS, OR WHAT Wl.li THE U.S. MARKET BEAR? ROBERT L. HOUBECK, Jr. Head Seriais Division University of Mic~g~ Library Ann Arbor, Michigan 48109 Abe&act - ~~at~~ed with the ~a1 ~planations British pub~~hers have offered for the large price differentials between their U.K. and US. customers- explanations such as increased distribution costs and currency fluctuations- the author examined 108 journals published by seven major British publishers. He compared their U.K. and U.S. prices and price differentials against four “Value indicators”: local use, citation frequency, a listing in Katz 3 Magazines for Librar- ies, and QCLC holding libraries, He has found that high prices and high price differentials correlate with high indicators of use/value. Lie concludes that the data suggest that British publishers arepricing their journals in the U.S. market accord- ing to what that market is apparently willing to bear. He further suggests that the challenge for libraries arising from this pricing strategy is to identifv on-going mechanisms for measuring value against price, in order to ensure that the price any publ~her demands for a title corresponds to the value delivered. Musicological sleuths have long since identified the 13 friends whom Sir Edward Elgar por- trays in his Enigma Variations. The larger theme in that composition, though, which “through and over the whole set [of variations] ‘goes,’ but is not played,” has proven more elusive. That theme has never been identified. In the matter of British periodical pricing, the fate of the enigmas has been similar but reversed. The reasons for the specific differential between the U.K. and the U.S. price assigned to any particular journal remains and may always remain-to all, that is, but the publishers-a mystery [l]. Why is this title priced 59% above the U.K. rate, why is that title 697001 The larger theme, though, which ‘goes’ but is rarely admitted, can be discerned with precision. Dr. John- son, two centuries ago, described that theme: “No shopkeeper sells a yard of ribband for six- pence when the current price is seven.” At least some British publishers are acting very like Johnson’s ribband merchants. They possess products that are in demand and they are pric- ing those products accordingly. 183 184 R. L. HOUBECK, JR. Exactly why these publishers have been unwilling to acknowledge that they are acting in accord with this fundamental economic tactic is in itself a tantalizing enigma. But, admit it or not, the reasons for charging U.S. institutional customers, for the same journals, substan- tially more than equivalent U.K. subscribers are not difficult to discern. Those reasons are not, at least primarily, the reasons publishers seem ready to recite. Post- age and shipping to the U.S. is one such reason. The postage and shipping charges which American publishers add to their overseas subscriptions, when such charges are added at all, appear to increase the prices of American journals sold overseas by lO-15%. The average 1985 markup on the British titles we have examined, on the other hand, was a hefty 66%. If shipping indeed warrants that sort of markup, American libraries might better buy a 747 and ship the titles themselves. Even if by some miracle American librarians were able to get together and buy that 747, though, at least some British journal publishers would be unlikely to find that an acceptable alternative, These publishers, curiously, have become alarmed that some American libraries have been “avoiding” paying those higher US. prices. That is why many of them have been insisting that British subscription agents begin to identify the final destination of each sub- scription, even when the agent receives and reships the titles himself. In fact, what one sus- pects is that the revenues publishers are “losing” by our practice of purchasing British titles through British agents at British prices are not revenues designed primarily to cover the costs of distribution. This suspicion has been strengthened in our minds by the unspoken but real information conveyed by the prices British publishers are charging their U.K. and non-U.S. overseas cus- tomers. We know from a 1981 Royal Society study [2] that Britain accounts for 15% of total sales of British scholarly journals, that the U.S. market accounts for another 35-40070, and the remaining 50-55% of sales made elsewhere overseas. Let us assume that this general dis- tribution holds for most major British journal publishers. Most publishers charge their non- U.S. overseas subscribers either the same price as their U.K. customers, or a price IO-20% above the U.K. rate. Those lower prices-that is, the prices publishers charge to 6065% of their customers-speak clearly. They tell us the price at which the publisher can meet his costs and realize some profit. [3] The higher U.S. prices, in that context, tell us quite explicitly why British publishers are alarmed when American subscribers “avoid” paying those inflated publisher-assigned American prices. Nor have we been satisfied with the explanation that U.S. prices are higher because pub- lishers fear fluctuations in the pound. Indeed, the direction of the pound in recent years has been downward against the dollar, though never more than 15-16% in any January-December period. [4] Moreover, those American libraries which buy either directly from the publisher or through an American agent pay, not in pounds, but in dollars. If a publisher’s intent is to make about the same margin of profit on a title sold in the U.S. in dollars as on a title sold elsewhere in pounds, given the downward direction of the pound that prevailed in the 1984-85 period, there was simply no justification for charging U.S. customers who paid in dollars an average rate of f1.00 = $2.30 when the pound’s actual value at the time 1985 prices would have been set (May-June 1984) was in the range of $1.40. In those circumstances, when the pound did drop even further against the dollar, margins on titles paid in pounds would have dropped but margins on titles paid in dollars would have increased, even had Ameri- can subscribers been paying rates closer to $1.40 than those they were actually paying. Again, publishers’ pricing strategies strongly suggest that they have not been motivated primarily by a desire to protect themselves from wide fluctuations in the value of the pound, nor have they been interested in making the same margins on U.S. sales as they realize on domestic and other foreign sales. British Journal Pricing 185 The standard explanations, then, that British publishers offer for the substantial differen- tials demanded of American libraries simply fail to convince. Much more likely because more natural has seemed to us the explanation which, in any other context, would seem too obvi- ous to need stating: that British publishers are pricing their products in their various mar- kets in the same way other ordinary businesses price theirs, that is, according to what each market will bear. And why will the U.S. market bear these high differentials? Why will we pay more for the same products than other world customers? In part, no doubt, because we can pay more. In part, too, surely, because we find it wrenching to break subscription runs. But mainly, we suggest, because British publishers have done their marketing homework. Of the titles we have examined, high price differentials (i.e. 3OVo+ above the U.K. price) correlate strongly with high indicators of use/value. British publishers are marketing strong products for which, not surprisingly, they are charging strong prices. They are charging-and American librarians are paying- Wedgwood prices for products that are, arguably, Wedgwoods. Given this pricing strategy, librarians indignant at high differentials and itching to respond with large-scale can- cellations would have a tough time scratching that itch. To test this suspicion that British publishers have set high differenti~ rates on titles Ameri- can libraries would be least likely because least willing-or able-to cancel, we began by iden- tifying from an initial local study and from Hamaker and Astle’s investigations [5] seven major British publishers whose journals exhibited large differences between U.K. and U.S. price. These publishers were: Biochemical Society; Basil Blackwell; Butterworths; Cambridge Uni- versity Press (CUP); Longmans; Oxford University Press (OUP); and Taylor & Francis. We then identified as many of the periodicals of these publishers to which we subscribed as time and resources permitted. This search produced 108 titles. Price differentials for these 108 titles ranged from 16% above the U.K. price to 114%. The average U.S. price for these titles exceeded the average U.K. price by 66%. We then measured these 108 titles against four variables that we expected would give us indications of a title’s “value”: (1) local use; (2) citation frequency (i.e. the number of times articles in a journal are cited in other articles) [6]; (3) the number of OCLC holding libraries [7]; and (4) a listing in the latest edition of Katz’s Magazines for Libraries. [8] We obviously lacked key marketing information available to the individual publishers, data such as their U.K. production costs or breakdowns of subscriptions by country and by institutional/indi- vidual subscriber. We recognized that we would thus not be able to discern for any given title why the publisher had decided upon a particular U.K. and U.S. price, and hence a particu- lar differential. We did expect, though, that these four variables would provide broad com- parative indicators of a title’s value to patrons and scholars, extent of U.S. institutional market penetration, and name recognition or prestige. Using these four indicators, we wanted to know how many of the 108 titles in our pool met how many of the following “value criteria”: (1) medium or high local use; (2) a citation frequency within the first or second quartile (i.e. the upper half) of all Science Citation Index (SCI)/Social Science Citation Index (SSCI)-tracked titles; (3) holdings in at least 202 OCLC libraries (i.e. the average number of OCLC holding libraries for all 108 titles); (4) inclusion of the title in Katz. (See the Appendix tables for a list of these 108 titles, along with prices, differentials, and variables met). To be sure, each of these criteria, taken individually, are fairly blunt instruments, Cita- tion frequency, for example, as reported in ISI’s SCI/SSCI Journal Citation Reports 1984, needs to be used with considerable caution. Taken together, though, these four criteria have enabled us to make, even if in a rough way, “value” comparisons between titles published by the same or one of the other six publishers. 186 R. L. HOUBECK, JR. Both the aggregate data and the data from individual publishers which we have gathered from these 108 titles tends to confirm our suspicion that British publishers have set high dif- ferential prices on strong titles. The data also suggests that many of the titles which, accord- ing to our criteria, are stronger tend also to bear somewhat higher differentials than the less strong titles. In Table 1 we see that 85, or nearly 80%, of the titles we examined met multiple value cri- teria. The average markup on these titles was 68%. The average markup on the 23 titles meet- ing none or only one of our four criteria was 58%-not a staggering difference, but an intriguing one. The 85 titles meeting two, three, or four criteria exhibited, on average, significant local use. They tended to be cited more frequently than titles meeting fewer of our criteria. They were also more likely to be acknowledged, in one of the basic lists of “best and most useful” English-language titles, as being key journals in their fields. These titles were also much more widely held than titles scoring less well against our criteria. High-scoring titles, too, tended to differ noticeably from lower-scoring titles in the areas of costs and revenues generated. The 85 high-scoring titles were priced in 1985, on average, 14% higher ($176.30 v. $150.78) than titles scoring comparatively less well. They also gener- ated, per individual U.S. institutional subscription, on average, a greater amount of revenue than did lower scoring titles ($67.78 above the U.K. subscription price v. $56.78 above). If one assumes that the number of OCLC holding libraries can give us a rough indication of the distribution of a publisher’s U.S. institutional subscriptions (that is, that Title A has twice as many U.S. subscribers as Title B), one can also estimate the comparative U.S. revenues each title might tend to produce. To derive such a figure for any given title, one calculates first the title’s average dollar markup over the U.K. price. One then multiplies this figure by the number of OCLC libraries holding that title. When we did the math for these 108 titles, we found that the stronger titles would have tended to generate, on average, two and one-half times more revenue on U.S. sales than might have been generated by titles meet- TABLE 1 SUMMARY DATA ON SELECTED BRITISH JOURNALS Titles Meeting Titles Meeting 2, 3 or 4 0 or 1 Value Criteria Value Criteria Number of titles 85 23 Avg. difference between U.K. & U.S. price (1985) 68% 58% Percent of titles exhibiting medium-to-high local use 83 of 84 11 of 20 Percent of titles with citation frequencies in 1st or 2nd quartiles among titles tracked by SCI/SSCI 48 of 60 Oof 11 Percent of titles listed in Katz 61 of 85 3 of 18 Avg. number of OCLC holding libraries, per title 228 105 Avg. U.S. subscription price $176.30 $150.78 Avg. amount paid by U.S. libraries, per title, above the U.K. price (per individual subscription) $67.78 $56.78 Avg. estimated amount paid by’ OCLC libraries, per title, above the U.K. price* $15,439 $5,987 *Total OCLC subscriptions in our sample multiplied by the average amount paid by U.S. libraries, per title, over the U.K. price. British Journal Pricing 187 ing fewer of our criteria. The average aggregate difference was %15,439.25 per strong title v. $5,986.76 per lower-scoring title. This pattern held for each publisher’s list, except Butterworths’. These specific dollar figures, of course, are simply indicative. Clearly, we have no access to any publisher’s U.S. circulation figures. If OCLC holdings, though, do tend to reflect a publisher’s U.S. subscription distribution, we can gain some insight into variations in differen- tials. Somewhat lower differentials on titles with higher sales can tend to generate as much or more revenue than higher differentials on titles with lower overall U.S. sales. Hence, we need not expect to see a neat correspondence between high differentials and high value indi- cators. We should, though, expect to find that strong titles- those which are used more heavily, cited more frequently, and are more highly esteemed in the judgment of experts- will be more widely held, will command higher prices, and hence will tend to generate more revenue than less strong titles. And that is indeed what the data indicate. This tendency for stronger titles to bear somewhat higher differentials was also marked in the case of two of our criteria taken separately. The 46 titles which ranked in citation fre- quency in the first or the second quartiles of the SCI/SSCI Journal Citation Reports tables were priced an average 71% above the U.K. price. The 24 titles ranked in the third or the fourth quartiles were priced 52% above the U.K. price. Similarly, the 95 titles exhibiting medium to high local use bore average differentials of 67%; the 10 titles on our list which exhibit low local use bore differentials of a still high but comparatively lower 52010. This tendency appeared, too, when we examined titles by subject. In Table 2 we clearly see that, for the 18 titles in our pool that are held by our Engineering-Transportation Library, higher use correlates strongly with higher differential rates-and with higher prices, too. The nine highest priced titles have a differential rate of 86% above the U.K. price; the nine lowest priced titles have a much lower (though still high} 57% differential. In the case of these titles, at least, it would seem that publishers recognize the relation between value and price and have set their rates accordingly. Those nine highest priced titles, too, one might note, meet an aver- age of 2.1 of our value-criteria: the nine lowest priced meet, on average, only 1 .O. This table also illustrates well the danger of focusing solely on price in isolation from various indica- tors of use or “value.” A title that costs $735 but gets 290 uses can be construed as costing, for that year, only about $2.54/use. On the other hand, a less expensive but also much less used title may be, per use and for that year, 10 or 12 times more expensive, which is another way of saying that librarians need to consider with caution the variety of ways in which use- and value-might be measured. Of the eight titles that failed to meet any of our criteria, four were relative newcomers which in any case could not have met one of our criteria (inclusion in Katz, which appeared before they were published) and could have met two others only with difficulty (a more than aver- age number of OCLC holding libraries and a citation frequency ranking in SCI/SSCI’s Jour- nal Citation Reports, which require three years of data on a title in order to calculate a ranking). These recent titles are Journal of Garden History (Taylor & Francis, 1981-, 52% above the U.K. rate); Bioessays (CUP, 1984-, 53% above); British Journal ofMusic Educa- tion (CUP, 1983-, 56% above); and Laser & Particle Beams (CUP, 1983-, 79% above). A fifth recent title which met just one of our criteria was Behavior and Information Technol- ogy (Taylor & Francis, 1982-, 56%). It is, however, worth noting that apart from Laser & Particle Beams, which is a title covering a growth-area in the U.S. research community, the price differentials for the other four recent titles, though high, are in fact in each case well below the average U.K./U.S. price differential for the other more established titles published by each firm. This is precisely the sort of pricing pattern one would expect to see in each case. 188 R. L. HOUBECK, JR. TABLE 2 SELECTED BRITISH TITLES HELD BY U-M ENGINEERING-TRANSPORTATION LIBRARY Title Qo Difference, Citation U.K. vs. U.S. OCLC Title No. of U.S. Price Local Use* Frequency** Price Holding Listed Criteria (1985) (1984185) (quartile) (1985) Libraries In Katz?? Met Journal of Fluid Mechanics International Journal of Control International Journal of Systems Science International Journal of Electronics Fuel Cryogenics Ergonomics International Journal of Production Research Computer-aided Design Applied Mathematical Modelling Journal of the Science of Food & Agriculture Journal of Food Technology Maritime Policy & Management Engineering Structures Ultrasonics Data Processing Clay Minerals Behavior & Information Technology !§735 NA/290 $690 42/102 $560 9/20 $530 27/14 $500 24/20 $336 4/22 $320 36/89 $294 50/49 $284 132/52 $230 19/18 $215 9/11 $195 o/12 $170 3/4 $170 2/6 $150 35/9 $148 36/12 $110 5/9 $98 20/16 1st 2nd 3rd 3rd 1st 3rd 1st 4th 3rd 4th 2nd 3rd 3rd 3rd 4th 2nd 69% 89% 100% 97% 43% 43 Qo 104% 112% 29% 43% 59% 76% 106% 43% 43% 29% 57% 56% 219 Yes 137 No 85 Yes 91 No 82 Yes 187 No 223 Yes 138 No 117 No 116 No 117 No 59 No 39 Yes 74 No 138 No 84 Yes 76 No 41 N/A 3 2 3 1 3 2 4 1 1 1 1 0 2 0 1 2 1 1 *Bound/unbound reshelving statistics. **Citation frequency: drawn from Science Citation Index and Social Science Citation Index, Journal Citation Reports 1984. Cited here are quartile rankings (i.e. 1st = articles in this journal were cited during 1984 in other articles as frequently as articles in one-quarter of all journals tracked by SCI/SSCI; etc.) TKatz, William A. Magazines for Libraries. New York: Bowker, 1982, 4th ed. One can perform on the data other calculations that will confirm these patterns wherein stronger titles tend to bear somewhat higher differentials and tend as well to generate-again, if our OCLC variable gives us an accurate picture of U.S. subscription distribution for each publisher’s list-considerably more U.S. revenue than titles scoring less well. One can, for example, using that OCLC variable, project the comparative amount of U.S. revenue that each title might have generated. One can then divide each publisher’s list in half, comparing the estimated top revenue earners against the bottom earners. For each publisher, one would find that the average amount of U.S. revenue, per individual subscription and per all sub- British Journal Pricing 189 scriptions, is greater for titles scoring higher against our criteria. In the case of three publishers - Taylor & Francis, CUP, and Longmans - when examined from this perspective, stronger titles tended also to bear somewhat higher differentials. Differences between top revenue-generators and bottom revenue-generators were, respectively, 93% vs. 77%, 74% vs. 65% and 49% vs. 39%. The data we have gathered thus far in our investigations are not conclusive. Some of our indicators-such as our citation frequency variable, for example-need refinement. More- over, to get a complete picture, one ought to examine all the titles on a publisher’s list. Still, the data- and common sense -does suggest we are looking in the right direction. Specifically, the data strongly suggests that some British publishers are setting very high differential rates in the U.S. market on what are very strong titles. In this way they are able to realize higher revenues per title from their U.S. sales than they would derive were U.S. libraries paying either their general overseas rates or, where separate overseas rates are not quoted, the U.K. rate. At the same time, by setting those higher differentials on relatively stronger titles, publishers effectively minimize the risk of cancellations. The pricing strategy which CUP and Taylor & Francis appear to be following on new titles, where these titles are priced in the U.S. at rates below their “fleet average” differential for more established titles, tends also to sup- port this surmise. Finally, the data also suggests that, although virtually all the titles exam- ined bore “high” differentials, the higher differentials tended to be attached to the stronger titles. One needs to add some cautions to this latter point. The highest differentials do not in every case correspond to high indicators of value; nor do (relatively) lower differentials always cor- respond to low use or low citation frequency or to few holding libraries. Keesings, on the Longmans list, at 83% above the U.K. price meets four of our criteria and is clearly a cen- tral title by any measure. Yet Longmans in 1985 priced the equally key English Historical Review at only (!) 36% above the British market. Still, even at one-third the price of Kees- ings and with that lower differential, based on its probably wider U.S. circulation, we esti- mate that EHR might have generated in the U.S. market nearly half as much revenue as the title bearing the higher differential. Clearly, one ought not to press variations among absolute differentials too hard. Differen- tials, after all, tell us as much about the British as about the U.S. price. Public Administra- tion, for example, met only one of our criteria yet in 1985 was priced 89% above the U.K. price. From OCLC, we assume that comparatively few U.S. libraries hold the title. Yet this title has by far the highest total circulation (as reported in Uirich’s) of any title on our Black- well list. Its circulation, one might speculate, may well be relatively wider among British librar- ies; the title may even be targeted principally to the U.K. and Commonwealth market. Many of its articles deal with aspects of British politics and government. Moreover, its overseas rate is significantly lower than the rates of the other Blackwell titles we examined (9070 above the U.K. price v. 20-25070 for the other titles). Blackwell’s, then, may be pricing Public Admin- istration primarily for its domestic and non-North American market. Hence the high differ- ential might in this case be the result, not of a desire to extract from American librarians the last possible farthing, but rather of a recognition of this title’s limited ability to penetrate the U.S. market coupled with a desire on the part of Blackwell to keep its price in Britain and in some Commonwealth markets attractively low. Particular differentials, then, are surely as conditioned by the U.K. as by the U.S. market. All of which, though, still leaves unan- swered the question: Why price this title to those fewer U.S. subscribers 89% above that lower U.K. price? Other overseas customers pay only f2.50 more than British customers. U.S. sub- scribers pay an average f24 more. 190 R. L. HOUBECK, JR. If it would be a mistake to focus too narrowly on specific differentials between particular titles, U.S. librarians, reflecting on the overall magnitude of the differentials and the high quality of the titles to which they are attached, can legitimately surmise that many British publishers have targeted their strongest titles for high, if not always the highest, differentials. After all, of the 108 titles we examined, 103 (95%) were in 1985 priced at ieast 30% above the U.K. price; 96 (89%) were priced at least 40% above the U.K. rate; 84 (78?‘0) were priced at least 50% above the U.K. rate. If the U.K. price for a title tells us what is at least the pub- lisher’s break-even price, those high U.S. differential rates in turn indicate the sort of profit margins British publishers are realizing from their U.S. sales. It would be a mistake, too, to regard the mere narrowing of these differentials as a sign of “victory” for the American library community. Those rates could be narrowed by a lower- ing of the U.S. price-which will not happen, at least not without some dramatic action by American institutional consumers. They could be narrowed, as Taylor & Francis has been narrowing its 1986 differentials, by a rise in the British price- which is no service to our British colleagues who are also struggling to keep their patrons supplied with ready access to these same research publications. Similarly, a single price for the entire world would have the same negative effect upon-British libraries (not to mention the libraries of far less affluent parts of the world) with no corresponding advantage to us. The single world price, we may be cer- tain, would be the higher U.S. price, not the lower British. More than bare price differentials between countries, our data indicate that American librar- ians ought to be taking a second look at the actual prices we are being charged for British journals. Those prices suggest that we may need to become more alert-and discriminating - consumers. Consider, for example, one of those anomalies on our list, Taylor & Francis’ His- tory o~~~~c~~jo~. This title failed to meet our value criteria in a single category. Its 1985 issues cost U.S. libraries a hefty 112% above the price charged U.K. subscribers. But even more surprisingly, those issues cost U.S. libraries $131.00. Now, according to Horn and Len- zini, 191 the average 1985 U.S. education periodical costs only $37.81. History of Education may well be a better title than the average U.S. education periodical. Still, rather than focusing only on that 112% differential, American librarians ought to be asking how they might go about deciding whether this title is worth 247% more than the average U.S. education peri- odical. This question of worth-to whom and by what measures-is one of the key questions raised by this phenomenon of differential pricing. In Table 3 we set out the results of a spot comparison of 1985 U.S. prices for various cat- egories of British journals versus the average 1985 prices for U.S. periodicals in the same sub- ject areas. In philosophy and religion, political science, and economics the prices of the British periodicals we examined exceeded those of their average US. counterparts by 145%, 117%, and 91070, respectively. Clearly, more work needs to be done with these sorts of comparisons. For one thing, we ought to attempt to identify the true peers and the true competitors for each of these titles and compare those prices one with another. Very likely many British jour- nals are far better titles than the “average” U.S. title in the same field. Still, these wide vari- ations in price for journals in the same subject area are worth both further investigation and reflection. In particular these variations are worth reflection because they point to the question: What for any journal is the upper limit to which its price could rise before librarians would find that its price exceeded its usefulness? This question, in an institutional setting, where the people who use a journal-and those who will someday use the journal-are not the people who bear the direct costs of that jour- nal, is particularly difficult. Yet, in the light of Table 4, the question for U.S. librarians may well become increasingly apposite. British Journal Pricing 191 TABLE 3 AVERAGE 1985 U.S. PRICES OF SELECTED BRITISH PERIODICALS VERSUS AVERAGE 1985 PRICES FOR U.S. PERIODICALS IN THE SAME SUBJECT AREAS U.S. Average* British Average** Philosophy and religion Political science Economics $24.30 $70.63 $32.72 $70.14 $44.41 $84.77 *Horn, Judith G. and Lenzini, Rebecca T., “Price Indexes for 1985: U.S. Periodicals,” Library Journal (Aug 1985), p. 54. **Philosophy & religion = 11 titles (Analysts, British Journal of Aesthetics, Journal of Ecclesiastical History, Metaphilosophy, Mind, New Testament Studies, Philosophical Books, Philosophical Quarterly, Philosophy, Ratio, Religious Studies). Political science = 7 titles (British tiournatof Political Science, Journal of Common Market Studies, Journal of Latin American Studies, Journal of Social Policy, Parliamentary Affairs, Soviet Studies, Studies in Comparative Communism). Economics = 8 titles (British Journal of Industrial Relations, Bulletin of Economic Research, Economic Journal, Energy Economics, Journal of Industrial Economics, Oxford Bulletin of Economics and Statistics, Oxford Eco- nomic Papers, World Economy). TABLE 4 PRICE DIFFERENTIALS AND VARIABLE SUMMARIES, BY PUBLISHER Avg. % Avg. U.S. Avg. Avg. Avg. OCLC No. of Avg. No. No. of Difference, Price Local Quartile Holding Titles Criteria Titles U.S./U.K. (1985) Use Rank Libraries In Katz Met Taylor & Francis 19 84% $333 Medium 2.0 126 s* 1.9 Biochemical Society 4 82% $321 High 1.0 289 3 3.5 Basil Blackwell 16 69% $66 Medium n/a** 196 12 2.1 Cambridge Univ. Press 35 69% $166 High 1.7 233 26* 2.9 Oxford Univ. Press 14 55% $58 Med-High n/a** 249 14 2.7 Longmans 10 44% $95 Med-High 2.0 211 4 2.3 Butterworths 10 40% $218 Medium 3.2 127 4 1.4 *Two Taylor & Francis titles and three Cambridge titles were published after Katz’s volume appeared. **Citation frequency data exists for fewer than half the titles examined. Taylor & Francis, for whatever reasons, feels confident pricing its titles in the U.S. mar- ket an average 84% above the U.K. price. How long will it take other British publishers, with titles equally strong or even stronger, to consider whether their titles are not underpriced in the U.S. market? How high, after all, could the U.S. price for Mind or for The Journal of African History rise, regardless of the U.K. price, before American librarians balked? There are already indications that German publishers are watching closely the reactions of the Ameri- can library community to the pricing strategies of their British counterparts. One, VCH, has taken action. Nor should we expect that American publishers will fail to notice how we respond to this issue. The real challenge differential pricing raises is not the challenge of inducing British pub- 192 R. L. HOUBECK, JR. lishers to narrow their differential rates. Any narrowing will not likely work to the advan- tage of their major institutional customers- us. Rather, the real challenge to American librarians is to begin acting more like the consumers we are. We need to begin aggressively to let the market carry our message. That message must be: We will cancel titles that do not meet and continue to meet minimum standards of value. But in order to send that message we need to be designing and sharing with one another mechanisms that will enable us to dis- cern, for our various disciplines, the relative value to our patrons of the products we pur- chase for their use, and purchase in most cases with public money. The indicators we selected for this study may not be the best ones or even the right ones. Indeed, one will likely need a variety of criteria and indicators for our various disciplines. Yet indicators we will need. Nor ought we to construct these mechanisms out of a mean-spirited resentment of British publishers and their high differential prices. Frankly, many of us have found these differen- tials higher than would seem reasonable. Still, publishing is a business. Businesses run on profits. And as people in business for the long run, these publishers surely need sufficient revenues for capital investments, for shoring-up lower-earning but important titles as well as for beginning and shepherding new titles. Without more information, we can only record our puzzlement and look for patterns. Yet, if we cannot, from the outside, decree what any given title “ought” to cost, we can very well say what for any given title we are willing to pay. The key question for us, then, is not: What’s the other fellow paying? Nor is it even: What’s that fellow raking in? Rather, it is: Am I getting what I’m paying for? If British titles, in comparison to their counter- parts, are indeed Wedgwoods-and many of them surely are- then we ought to expect to pay Wedgwood prices. What we need, though, are ways not only to distinguish the Wedgwoods from the budget brands. We need to know how we will weigh price against value. In any case, what we ought not to do is to continue to distort the journal pricing market, whether through inattention or timidity, by continuing to pay whatever we are asked simply because we are afraid to break a complete run or to do the hard work necessary to convince faculty of the need to balance value against price in our journal collections. With every renewal we send a message. Every renewal tends both to confirm this year’s price and to ground next year’s. To that extent we are in a measure responsible for the prices we pay. As managers of other people’s resources, before we pay many more additional install- ments, let’s start examining the china. APPENDIX In Tables Al-A7 we list the 108 titles used in our study, along with prices, differentials, and variables met. REFERENCES 1. In fact, it is more accurate to speak of a differential range, since the differential will expand or contract with fluctuations in the value of the pound. 2. Royal Society of London. Scientific Information Committee. A Study of the Scientific Information System in the United Kingdom. London: The Society, 1981. 3. Nigel Cross reports that journal publishers will admit to profit margins of 20%. Some speculate margins can be as high as 50%. See his interesting piece: “The Economics of Learned Journal Publishing,” Times Literary Supplement (23 November 1984), p. 1348. British Journal Pricing 193 TABLE Al BIOCHEMICAL SOCIETY, SELECTED TITLES Title Citation Avg. 1985 1985 %U.S. Rate Frequency Holding Title No. of U.S. Price* U.S. Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) U.K. Rate* rank)** In OCLC Katz?t Use Met Journal of Embryology & Experimental Morphology 125.00 $345.00 97% 1st 297 No High 3 Journal of Experimental Biology 115.00 $315.00 96% 1st 355 Yes High 4 Journal of Cell Science 150.00 $405.00 93% 1st 282 Yes High 4 Journal of Reproduction & Fertility 110.00 $220.00 43% 1st 221 No High 3 *Calculated at pounds f 1 .OO = $1.40 [exchange rate (approx.) as of 5/84 and 9/85)]. **Citation frequency = Avg. number of times an average article in a journal was cited in another article during 1984 (derived from “impact factor” data and ranking in Science Citation Index and Socioi Science Citation Index, Journal Citation Reports 1984, Vols. 15 and 7, respectively). Rank indicates where journal stands in relation to other science/social science journals in respect to frquency of citation (i.e. top 25%. second 25%. etc.) tKatz, William A. Magazines for Libraries. New York: Bowker. 1982, 4th ed. 4. For data on the period through 1984 see International Monetary Fund. international Financial Statistics. Sup- plement on Exchunge Rates. Washington, D.C.: IMF, 1985. p, 102. 5. Hamaker, Charles and Astle, Deana. “Recent Pricing Patterns in British Journal Publishing,” Library Acquisi- tfons: Practice & Theory, 8:4 (1984), 225-232. 6. For citation frequency rankings we have relied upon data which can be found in Science Citation Index 1984. Philadelphia: Institute for Scientific Information, 1985, Vol. 15: Journal Citation Reports and Sociul Science Citation Index 1984. Philadelphia: Institute for Scientific Information, 1985, Vol. 7: Journal Citation Reports. IS1 compiles data on the total number of articles published in a journal during 1982 and 1983 and the number of times articles from those issues were cited in other articles during 1984. They then calculate from this data an “impact factor*‘: that is, they divide the number of citations by the number of articles. This value represents the number of times an average article in the journal was cited during the previous year. In another table IS1 lists In rank order by “impact factor“ (i.e. citation frqucncy) all titles tracked. We derived our quartile ranking from this list. Thus a title such as Economic Journal, with a citation frequency ranking of 104th of 1357 titles tracked by SSCI, we have described as ranking in citation frequency in the first quartile of social science jour- nals. We have been able to furnish citation frequencies only for science and social science titles. IS1 does not publish citation frequency data for arts and humanities titles. (Citation frquency measures for such titles may be of more dubious value. To be at all a true measure of title’s value to scholars, citation frequency for such titles should be calculated over a much longer period of time.) Finally, our use of ISI’s indicators has been extremely broad-scale. More valuable would be comparisons of citation frequency between journals in the same subject areas. Yet even these sorts of comparisons need to be made with caution and a clear sense of the limitations of any such merely numeric measures. 7. To derive data on this variable, we searched each title in OCLC and counted the number of holding libraries. Since some titles have two or more records and since OCLC does not list actual holdings, these figures are approx- imate. WC have assumed, for purposes of this analysis, that libraries which indicated holdings for a title receive that title currently. 8. Katz, William A. Maguzines for Libraries. New York: Bowker, 1982, 4th ed. 9. Horn, Judith G. and Lenzini, Rebecca T. “Price Indexes for 1985: U.S. Periodicals,” Library Journal (August 1985), p.54. 194 R. L. HOUBECK, JR. TABLE A2 BASIL BLACKWELL, SELECTED TITLES Title Citation Avg. 1985 1985 %U.S Rate Frequency Holding Title No. of U.S. Price* U.S. Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) U.K. Rate* rank)** In QCLC Katz?7 Use Met Analysis Public administration Ratio Journal of Common Market Studies Universities Quarterly German Life & Letters Oxford Bulletin of Economics & Statistics Journal for the Theory of Social Behaviour World Economy Philosophical Books Metaphilosophy Journal of Industrial Economics Philosophical Quarterly British Journal of Industrial Relations Bulletin of Economic Research British Journal of Educational Studies I I .-Is 21.50 22.95 $33.00 $72.50 $59.95 100% 89% SW0 n/a n/a n/a 295 Yes 72 Yes 165 Yes Medium Low High 3 1 2 3 1 2 2 3 2 2 2 4 3 2 1 1 31.00 $78.95 82% 24.00 $61.00 81% 32.00 S80.00 79% 4th n/a n/a 235 Yes Medium 139 No Medium 226 No Medium 33.50 883.90 79% 3rd 1.55 Yes High High Medium Medium High 32.75 %S!.OO 76% 42.00 $100.00 71% 23.50 $55.50 69% 28.00 $65.00 66% 2nd 2nd n/a n/a 182 Yes 84 No 156 Yes 185 Yes 29.00 $65.75 62% 26.00 $57.50 58% 2nd n/a 289 Yes High 316 Yes Medium 19.50 $42.50 56% 3rd 135 Yes High 27.00 $58.65 55% n/a 80 No Medium 39.50 $76.75 39% 3rd 22s No Low TABLE A3 BUTTERWORTHS. SELECTED TITLES Citation Avg. 1985 1985 % U.S. Rate Frequency Holding Title No. of U.S. Price* U.S. Price Above (quartile Libraries Listed in Local Criteria Title (Sterling) (Dollars) U.K. Rate* rank)** In OCLC Katz?! Use Met Applied Mathematical Modelling 115.00 $230.00 43 % 4th 117 No Medium 1 Cryogenics 168.00 $336.00 43% 3rd 188 No High 1 Energy economics 88.00 $176.00 43% 3rd 80 Yes Medium 2 Engineering Structures 85.00 $170.00 43% 3rd 74 No Low 0 Fuel 250.00 $500.00 43% 1st I28 Yes High 3 Studies in Comparative Communism 17.50 $35.00 43% 4th 260 Yes High 3 Ultrasonics 7s .OO $150.00 43% 3rd 138 No Medium 1 Food Policy 79.00 $153.00 38% 4th 67 No Low 0 Data Processing 82.00 $148.00 29% 4th 99 Yes High 2 Computer-aided Design 158.00 $284.00 29% 3rd 117 No High 1 Title British Journal Pricing 195 TABLE A4 CAMBRIDGE UNIVERSITY PRESS, SELECTED TITLES 070 Citation Avg. 1985 1985 U.S. Rate Frequency Holding Title No. of U.S. Price U.S. Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) U.K. Rate rank) In OCLC Katz?? Use Met Journal of American Studies Journal of Social Policy British Journal of Nutrition Nutrition Society, Proceedings British Journal of Political Science Geological Magazine Journal of Hygiene Laser and Particle Beams Philosophy Journal of Latin American Studies Journal of Plasma Physics New Testament Studies Historical Journal Regional Studies Parasitology Journal of Anatomy Psychological Medicine Genetical Research Language Teaching Journal of Linguistics Annals of Human Genetics Religious Studies Journal of Physiology Journal of African History Journal of Fluid Mechanics Modern Asian Studies British Mycological Society, Transactions Journal of Ecclesiastical History Economic Journal British Journal of Music Education Journal of Child Language BioEssays International Journal of Middle East Studies Language in Society Comparative Studies in Society and History 28.00 $74.00 89% n/a 380 38.00 $98.00 84% 2nd 177 110.00 $280.00 82% 1st 195 55.00 $104.00 82% 1st 161 41.00 $104.00 81% 1st 63.00 $160.00 81% 2nd 39.00 $97.50 79% 1st 54.00 $135.00 79% n/a 48.00 $120.00 79% n/a 277 195 143 40 330 28.00 $70.00 79% 80.00 $197.00 76% 28.00 $69.00 76% 48.00 $118.00 76% 53.00 $130.00 75% 102.00 $250.00 75% 119.00 $290.00 74% ‘80.00 $195.00 74% 72.00 $175.00 74% 27.00 $65.00 72% 25.00 $60.00 71% 44.00 $105.00 71% 44.00 $105.00 71% 435.00 $1030.00 69% 35.00 $83.00 69% 312.00 $735.00 69% 47.00 $110.00 67% 3rd 2nd n/a n/a 1st 1st 2nd 1st 1st n/a 2nd 1st n/a 1st 2nd 1st 3rd 335 124 243 302 165 205 187 120 249 214 288 197 321 380 451 219 191 80.00 $187.50 67% 2nd 151 45.00 $105.00 66% n/a 261 45.00 $100.00 59% 1st 502 16.00 $35 .OO 56% n/a 37 41 .OO $89.00 55% 2nd 262 63.00 $135.00 53% n/a 48 42.00 $80.00 36% 3rd 257 40.00 $70.00 25% 1st 225 33.00 $57.00 24% 3rd 321 Yes High 3 Yes Medium 3 Yes High 3 Yes High 3 Yes High 4 Yes High 3 No High 2 n/a n/a 0 Yes Medium 3 Yes High 3 Yes Medium 3 Yes High 3 Yes High 3 Yes Medium 3 No High 3 No High 2 Yes High 3 Yes High 4 Yes Medium 3 Yes High 4 No High 2 Yes Medium 3 Yes Medium 4 Yes High 4 Yes High 4 Yes High 2 No High 2 Yes High 3 Yes High 4 n/a n/a 0 Yes High 4 n/a n/a 0 Yes High 3 Yes High 4 Yes High 3 1% Title R. L. HOUBECK, JR. TABLE A3 LONGMANS, SELECTED TITLES % Citation Avg. 1985 1985 U.S. Rate Frequency Hofdhg Title No. of U.S. Price U.S. Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) U.K. Rate rank) In OCLC Katz?? Use Met Kecsings Contemporary Archives British Journal of Urology Urban Studies Tissue and Cell Tubercle Soviet Studies British Journal of Addiction English Historical Review Paraplegia British Journal of Plastic Surgery 70.00 %179&o 83% n/a 308 Yes 4 2 4 2 2 4 2 3 0 1 32&O 32,oO 120.00 38.00 28.00 $68.~ S64.00 $240.00 $75.00 SSS.00 51% 43% 43% 41% 41% 2nd 1st 2nd 2nd 2nd 149 No 250 Yes 176 No 76 No 330 Yes High Medium Medium High High 40.00 $76.00 36eTo 1st 63 No High 29.00 $55.00 36% n/a 566 Yes Medium 45.00 $86.00 36% 3rd 75 No Low 30.00 s55.00 31% 3rd 112 No High TABLE A6 OXFORD UNIVERSITY PRESS, SELECTED TITLES Title % Citation Avg. 1985 1985 U.S. Rate Frequency Hofdhsg Title No. of U.S. Price U.S, Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) UK. Rate rank) In OCLC Katz?? use Met English Language Teaching Journal Classical Review Journal of Southern African Studies Classical Quarterly Cambridge Quarterly Greece and Rome Oxford Economic Papers British Journa! of Aesthetics Parliamentary Affairs Journal of Experimental Botany Review of English Studies African Affairs Theatre Research international Quarterly Mind 13.00 $32.00 76% n/a 218 Yes Medium 19.00 $45.00 69% n/a 325 Yes High High High Medium High High 3 3 2 3 2 3 4 2 3 4 3 3 1 3 19.00 21.00 20.00 14.00 29.00 $45.00 $49.00 $45.00 $30.00 560.00 69% n/a 66% n/a 61% n/a 53alo n/a 49% 2nd 82 Yes 267 Yes 190 Yes 237 Yes 307 Yes 24.00 S50.00 49% n/a 264 Yes Low 24.00 S50.00 49% 4th 228 Yes Medium 110.00 $230.00 49% 1st 230 Yes High 24.00 $50.00 49% n/a 494 Yes High 22.00 $45.00 46% 3rd 231 Yes High 22.00 S45.00 46% n/a 164 Yes Low 16.00 $32.30 45% n/a 389 Yes High British Journal Pricing 197 TABLE A7 TAYLOR & FRANCIS, SELECTED TITLES Title @IO Citation Avg. 1985 1985 U.S. Rate Frequency Holding Title No. of U.S. Price U.S. Price Above (quartile Libraries Listed in Local Criteria (Sterling) (Dollars) U.K. Rate rank) In OCLC Katz?? Use Met Annals of Science International Journal of Production Research History of Education Maritime Policy and Management Ergonomics Annals of Human Biology Contemporary Physics International Journal of Systems Science International Journal of Electronics Optica Acta International Journal of Mathematical Education International Journal of Control Molecular Physics Journal of Natural History International Journal of Radiation Biology & Related Studies in. . . Xenobiotica Behavior and Infor- mation Technology Journal of Garden History History of Photography 87.00 99.00 44.00 59.00 112.08 67.00 65.00 200.00 192.80 178.00 65.00 260.00 348.00 173.00 209.08 168.09 45.00 45.00 $96.00 38.00 %60.00 $260.08 114% $294.00 112% $131.00 112% $170.00 106% $320.08 104% WO.CiJ $184.00 $560.60 $530.00 $490.08 103% 2nd 71 102% 1st 290 loos70 2nd 85 97% 3rd 91 %% 2nd 118 $176.08 $690.00 $860.00 $380.00 94% n/a 178 89% 2nd 137 77% 1st 205 57% 3rd 112 $460.00 $370.00 57% 2nd 154 57% 1st 83 $98.06 56% 52% 16% 2nd 174 4th 138 n/a 41 n/a 39 2nd 223 n/a 41 n/a 78 n/a 165 Yes No No Yes Yes No Yes Yes No Yes Medium High Low Medium High High High High Medium Medium No No No Yes No No n/a n/a Yes Medium High Medium High High Medium Medium Low Low 3 1 0 2 4 2 4 3 1 3 1 2 3 2 2 2 1 0 1