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Journal Economics During an Economic Downturn

As the slow economic recovery continues to impact state budgets and endowments, many libraries experienced budget cuts or static budgets while journal prices continued to increase. In Ebsco's Serials Price Projections for 2013, the expected overall publisher prices increased for academic and academic/medial libraries to be in the range of 5 to 7 percent. An emerging trend noted by Ebsco is the continued momentum of the open access model of academic publishing. However, the implications of the open access model of publishing on publisher prices and library budgets remains to be seen. In Ebsco's Serials Price Projections for 2012, the estimated overall price increase for academic and academic/medical libraries is anticipated to be 4 to 6 percent.  This is the same as the Serials Price Projections for 2011. Although this increase is also comparable to 2010 (5 percant range), and lower than the increases in previous years (8 to 10 percent), it is still beyond the reach of many library budgets which are either stagnant, or are being cut.
Many examples can be found of the impact of budget cuts on libraries' ability to purchase journals and other library materials. In a survey by Ebsco in 2011, over 30 percent of librarians forecast budget decreases of more than 5 percent. (See Serials Price Projections for 2012 above). 
New Mexico State University announced cancellations of 723 print and electronic journals, databases, standing orders and microforms (see NMSU Final Cancellations) in response to a 27% reduction in the library's materials budget. New Mexico is hardly alone. In Georgia, budget cuts led to a cancelation of 660 journals at the University of Georgia. In Virginia, the University of Virginia cancelled over 1,000 journals in response to budget cuts. Private schools have not been immune from budget cuts and journal cancellations. Yale University Library has announced reductions in the collections budget of 10%, with an additional 5% resulting in futher journal and database cancellations.
The extensive nature of these reductions in journal collections, both in terms of numbers of universities cancelling journals and number of journals being cancelled, has garnered the attention of scientists. In an article in The Scientist "Library cuts threaten research" the loss of access to journals is considered to have a direct negative impact on scientist's ability to do research and complete grant applications.
Librarians have not been silent during these budget cuts, and have publicly appealed to vendors and publishers to contain rising costs during this difficult economic time. In January 2009, the International Coalition of Library Consortia (ICOLC) issued a Statement on the Global Economic Crisis and Its Impact on Consortial Licenses. The Statement asks for 'flexible pricing' and 'creative solutions' from publishers to benefit both libraries and publishers in the long-term and during the ongoing economic crisis.
In addition, the University of California drafted an Open Letter to Licensed Content Vendors in May 2009 advising publishers and content vendors of the serious economic challenges faced by libraries in California. In June 2010, the University of California publicly and strongly objected to what it perceived as unjustified price increases by Nature for journal renewals. In August 2010, University of California and Nature Publishing Group issued a joint statement on the progress of their negotiations. The very public aspect of these negotiations was unusual, including the possibility of a call for UC faculty to boycott publishing in Nature, and brought to light aspects of price negotiations that are often conducted behind closed doors with the results being held in confidence.
In response to confidentiality clauses in license agreements, ARL issued a statement encouraging members to refrain from signing licenses with confidentiality clauses. The resolution was adopted because of concerns that these clauses have a 'negative impact on effective negotiations' with publishers.
The response from the publishing community has been varied. Some publishers have heeded the call from libraries, while others have not. For example, the Medical Library Association has a list of publishers who have frozen prices for 2010. In contrast, some publishers who have multi-year contracts with libraries have maintained the price increases specified in those contracts which were often negotiated before the economic downturn.
The ultimate effects of the current economic crisis are unknown on both libraries and publishers. Libraries are re-considering the way in which they do business, including whether bundled packages of journals (often called 'the big deal') are a good value since these deals often lack flexibility and include little used titles. In addition, some have proposed that the economic downturn provides an opportunity to reconsider scholarly communication and promote new ways for universities to support Open Access.