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Environmental
Scan of Pricing Models for Online Content
Prepared by Albert W. Darimont
OnDisC Project
November 2001
OnDisC Alliance 2001
1.
Executive Summary
2. Introduction
3. E-Business
Models
4. E-resources
in Today's Academic Libraries
5. Library
E-business
6. E-journals
7. Subject Based Gateways
8. Content
Aggregators
9. Non-profit,
subsidized
10. Content
Providers
11. Conclusion
12. References
Subject Based Gateways
Subject Based Gateways (SBG) are web sites which
are created and maintained to provide pointers
to free, high quality Internet resources for
specific subject areas. Thus far they are largely
of European origin in general and British origin
in particular. The Electronic Libraries Programme
(eLib) projected, supported by the Joint Information
Systems Committee (JISC) funded the development
of a number of SBGs and research studies concerning
their use. One supporting study by Haynes et
al. evaluated three different economic models
by which the SBGs could move beyond supported
project status into a sustainable service. The
recommended model was one in which the SBGs
should continue to receive funding from JISC
for two years during which time they would move
towards 50-50 funding from JISC and other sponsors.
Haynes also recommended that many functions
of the various SBGs such as marketing and training
be rationalized and centralized to reduce costs
and this led to the creation of the Resource
Discovery Network Centre.
Some examples of active SBGs include: the Art,
Design, Architecture & Media Information
Gateway (ADAM) http://www.adam.ac.uk/;
The Biz/ed Internet Catalogue http://bized.ac.uk/;
and the Arts and Humanities Data Service (AHDS)
http://ahds.ac.uk/.
A general subject gateway is the Bulletin Board
for Libraries (BUBL) http://bubl.ac.uk/link/ which contains pointers
to a large number of subject areas. The Multimedia
Educational Resource for Learning and On-line
Teaching (MERLOT) http://www.merlot.org/Home.po,
is a SBG created in 1997 by the California State
University-Center for Distributed Learning.
It now serves over 1,400 campuses worldwide.
Typically the SBGs are highly organized and
contain annotated and classified links (using
Dewey Decimal Classification) that are located
and reviewed by subject experts. The above SBGs
are free and without advertising; their source
for operating revenue is not apparent. In contrast
a North American SBG, Netfirst http://www.oclc.org/oclc/netfirst.htm,
is available through paid subscription to OCLC,
an online non-profit bibliographic and cataloguing
service.
Discussion
Electronic journals allow for flexibility in
the supply of academic articles that was not
possible when print was the only viable medium
for distribution. Pricing models are available
which can give libraries access to a larger
number of titles while at the same time requiring
them to pay for only the journal articles that
are requested by their patrons. OnDisC could
offer this kind of flexibility to libraries
(or institutions) which are considering paying
a fee to access the content of OnDisC. One possibility
would be to offer different prepaid levels of
access, for example a value membership would
pay in advance for 1,000 object downloads/month
while a premium membership would pay a larger
membership fee for 5,000 downloads/month. This
kind of metering does entail some cost and risk
however. There would be the extra administrative
costs of setting up and managing accounts and
users may be reluctant to freely use a resource
that is “limited”. There is also the risk
that institutions, if facing budget restrictions,
would look first to save money by maintaining
the service at a lower level (i.e. a price reduction
is easier than outright cancellation).
Another way to take advantage of the flexibility
of the digital distribution channel would be
to offer different sets of OnDisC bundles in
a manner analogous to the way cable companies
offer different cable TV packages to subscribers.
It might even be possible to combine bundling
with metering. For example, an institution might
wish to purchase 3,000 downloads per month for
a highly relevant collection, but may wish to
purchase only 500 downloads per month from a
less relevant collection. They may consider
buying a 4,000 download bundle of the two collections.
Again however, this type of pricing model would
incur additional administration costs.
Subject Based Gateways are similar in several
respects to OnDisC. First they both provide
an access function to separate content entities
and the content ‘collective’ acquires much
needed critical mass that can give the individual
entities a degree of exposure they would not
receive on their own. Secondly, both SBGs and
OnDisC provide a quality assurance function
to their constituent entities; SBGs by reviewing
and excluding sites that do not reflect a certain
level of quality and OnDisC by providing technical
and marketing assistance. Both SBGs and OnDisC
thus add value to the information content supplied
by the constituent entities or members. Where
they differ is in the relationships to their
members. SBG websites are more or less completely
independent from their content ‘providers’
and they could appear in any number of other
SBGs. OnDisC and it's members have an exclusive
two way relationship that includes financial
and legal components. This difference is a major
one and should be taken into account when examining
SBG business models for their relevance to an
organization like OnDisC.
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