Publishers and Business Aspects
In the 1960s and 1970s, commercial publishers began to selectively acquire "top-quality" journals which were previously published by nonprofit academic societies. Due to the inelastic demand for these journals, the commercial publishers lost little of the market when they raised the prices significantly. Although there are over 2,000 publishers, three for-profit companies (Reed Elsevier, Springer Science+Business Media, and John Wiley & Sons) account for 42% of articles published. Available data indicate that these companies have high profit margins, especially compared to the smaller publishers which likely operate with low margins. These factors have contributed to the "serials crisis" - from 1986–2005, the number of serials purchased has increased an average of 1.9% per year while total expenditures on serials has increased 7.6% per year.
Unlike most industries, in academic publishing the two most important inputs are provided "virtually free of charge". These are the articles and the peer review process. Publishers argue that they add value to the publishing process through support to the peer review group, including stipends, as well as through typesetting, printing, and web publishing. Investment analysts, however, have been skeptical of the value added by for-profit publishers, as exemplified by a 2005 Deutsche Bank analysis which stated that "we believe the publisher adds relatively little value to the publishing process... We are simply observing that if the process really were as complex, costly and value-added as the publishers protest that it is, 40% margins wouldn't be available."
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