Acquisitions

Sorting out sortia - Buying via consortium

Lian Todd, DA Information Services

Objective for today

To address ...
The role of consortia and collaborative access to e-journals and other sources of electronic information...

• Is there a role for an agent?

Note:
I have been asked to talk about the benefits and pitfalls of negotiating consortia tonight. To do this, it is also important to understand:
Why consortia happen.
Where the libraries and the publishers are coming from.
What are the expectations of libraries and what are the expectations of publishers when embarking on consortia activities?

Definition

• Consortium v's buying group
  
  • 'Co-operation of several powers or large interests to effect some common purpose' Concise Oxford dictionary
  • One offer, one invoice, cross sharing
  • Buying group - several interested parties gather together for volume buying purposes
  • One offer, several invoices, individual collections

Why consortia?

• Increased access to information ... (collaborative or otherwise)
  
  
• Combine buying power
  
  
• Costs and time savings
  
  
• The common good?

Note:
Single driving force behind libraries pursuing consortium purchase is the opportunity to increase access to information which would otherwise not be available to them.

Why not consortia?

• Very expensive and trying to both libraries and publishers
  
  • Negotiating consortium deals is time consuming (up to 18 months or more) and expensive in staff time for both sides
  • Doing only marginally different deals for different permutations of basically the same libraries is wasteful and inefficient
    
    
• Initiating, co-ordinating, negotiating and managing consortia requires many skills that often do not reside with one person
  
  
• Long gestation period from expressions of interest to the actual purchase
  
  • Messy and convoluted
  • 'Herding cats' - libraries often have different agendas
    
    
• Lowest common denominator solution
  
  • Compromise unique needs of individual libraries

Note:
Planning, background work such as:
Getting a group together, setting parameters, determining what products, collecting information on user population, number of sites, method of access (IP or password), writing the proposal, approaching /publishers, setting the terms, organising trials, gathering feedback, doing evaluations.
Negotiating terms, negotiating payments, discounts, etc.
Support for the e products.
Renewals - it starts again

Why libraries do it?

• Shrinking budgets
  
  • Increased bargaining power
  • Reduce costs, increase affordability
    
    
• 'We want it'
  
  • Increased demand from users as the range and amount of information becomes more easily available ... electronically
    
    
• Consortia can provide increased access to more information at lower costs.

With significantly more money to spend, the libraries naturally will have more bargaining power to wield. Publishers are more inclined to offer bigger discounts and more favourable conditions in negotiations where the amount is exponentially larger then if dealing with one institution.

Why publishers oblige?

• We love you really
• Increase sales (for less effort?)
• Market share
• Customers' requests

Note:
We love you really. Publishing is a business and publishers are business people. They are here to sell us their databases - some we really want, others we are not too fussed about. As librarians, it pays to understand this.
However, publishers and vendors are not our enemies. To put it objectively, their job is to sell you their products and our job is to buy them at the best possible price and terms that we can negotiate for.
Increased sales: Bigger sale for less effort - although this is not always true! Consortium may be harder work then publishers expect because of the nature of librarians (herding cats).
Market share: Publishers looking to establish or increase their market share, to get their products accepted in the market place. They will also have a bigger customer base, reaching libraries which they won't if not for the consortium.
Customers' requests: Basically, you have asked for it and publishers will try to oblige, especially if there is something in it for them. When publishers sells via consortium, they usually take less profit.
Publishers have been know to offer a consortium with no immediate gain to themselves initially. The gain may come later and that's a gamble (or trust, depending on where you stand) they take.

We are but very little...

• Some facts:
  
  • Globally, Australia and NZ is a small market.
  • Geographically we are more removed from the action.
  • Strategically, whilst of some importance, we are not indispensable.
    
    
• But, we need to make sure that publishers take notice of us and our needs.

Note:
Australia's population of 19 million is the size of Illinois.
NZ's population of 3 million is the size of Melbourne.
At best, we make up 20 per cent of most publishers' global business.
OZ is far away from the centre (US and UK, Europe) where strategic planning and development of databases happens.
How do we make sure that publishers take notice of us?
Lobby them, buy more?

Types of Consortia

• By group
  
  • Common interests eg. CEIRC, VALAG, FLIN...
    
    
• By publisher/vendor
  
  • OCLC, ISI, CSA, PIL
    
    
• By discipline
  
  • Medical, health, law, agriculture, etc
    
    
• By databases or product (subject-specific)
  
  • eg. netLibary, WoK, RefWorks, knovel...

Note:
Consortium offers come about in a number of ways.
1. Agent/publisher generated -
This is where the agent who is closer to the market and gets the feedback from customers, initiates a consortium offer with the relevant publisher. The publisher, working with an agent, takes the initiative to put together a consortium offer for a particular group of customers.
In this case, we will do some market research, find out who's got what, maybe estimate the amount of use, etc, and work out what the product or suite of products to offer, set the pricing and then take it to the market. Then the negotiations begin.

Elements in a consortium

• Information
• Content
• Pricing
• Licensing

Elements in a consortium

Information

• Libraries
  
  • Who are interested?
  • What e-journals/or databases required?
  • What consortia model suits?
  • How much will they pay?
    
    
• Publisher
  
  • Interested libraries?
  • Which products?
  • Staff, potential users?
  • Number of sites?
  • Access conditions?
  • Authentication?

Note:
It will be very useful before embarking on the consortium path for libraries to do some preparation.
It is important that the consortium is clear about what it wants before going into negotiations with publishers.
Publishers also need to gather some basic information before they can make an offer to a consortium.
The information is needed to ensure that they are offering you a good and fair deal without undermining their bottom line.

Content

• What are you buying?
• What is the publisher offering access to?
• What do you get access to?
• What do you want to get access to?

Note:
Content: What databases/full text journals/books are the consortium interested in purchasing? Who is accessing what and where from?
Pricing: This depends on factors like:
Types of libraries: Profit Vs non-profitm academic Vs non-academic, user population and potential users, number and location of sites, remote access, physical boundaries - state, national, international.
Licencing: Important that someone understands the license that the consortium is signing with the publishers. No matter how tedious, read through it and make sure that all the issues agreed to are included in the license are included. Eg. Listing of the insititutions and sites allow to access the databases.
Check definations of terms like 'site' 'user'
Inter library loans? Electronic transmission of data?
Publishers are reasonable, unless customers persistantly break the rules set out in the license.
Invoicing: The paperwork. One invoice v's many invoices?

Pricing

• Discount structure?
• E only or e plus p?
• One or multiple year pricing?
• Fixed or flexible renewal pricing?
• Currency protection?
• One invoice? Multiple invoices?

Note:
Discount structure: FTE? Band? Tiered? Spend? No of sites? Usage?
Multiple year pricing: ability to cap and therefore manage the price increases.

Licensing

• Generic licences
• Australia-only license

The consortium

• Should be managable - start small
• Common goals and objectives
• Commitment and support from all members
• Expectations reasonable and fair

The negotiation

• Appoint a liaison person
• Be clear on your aims and objectives
• Communicate with your group
• Provide the necessary information to facilitate the negotiations
• Be flexible...be prepared to vary your requirements, to compromise.
• Don't lose sight of your main objective... is it access? Price? What will you give up to get it?
• Don't get bogged down by details.

Note:
Liaison person - This person can be a member of the group or a professional negotiator. It is helpful to have one contact point for the publisher to work with as it makes negotiations easier and more controlled.
Be very clear about what your group is looking for in terms of content, access, price, etc.
Communication with your group is very important to keep them up to date with what you have negotiated with the publisher.

Consortia models

• One price
• Tiered pricing
• A fixed price
• Variable price
• Bundling
• Units
• Open consortium
• Closed consortium
• Simultaneous users
• Site access
• Unlimited access
• Single or multiple databases
• Pay your subs, but see the rest
• Transactional access

The agent's role in consortia

• Adding value
  
  • To libraries (customers)
  • To publishers

How do we do this?

• Experience
• Expertise
• Choice

Experience

• Local knowledge, library professionals
• Product knowledge and its applications
• Liaison between publishers and libraries
• Done lots of these before...

Note:
Breath and depth of representation:
As an agent for a wide range of publishers, and servicing libraries across all sectors, DA is able to represent the views and needs of our markets to these publishers and vice versa.
DA is an Australian-owned company. For many years, the library profession had used DA to represent their views to publishers; for leverage in negotiating deals, etc.
Local knowledge:
Publishers also depended on DA's local knowledge to help the understand our customers and market their products here.
Ability to understand local needs and issues and effectively communicate these and liaise between libraries and publishers (in management of e-journals).
Currency: Publishers' acknolwdgemnt of Aust conditions, eg. currency relative to world markets DA's role in developing this understanding - leading to benefits within the pricing or consortia offers.
Agent's role in currency fluctuation/declining budgets.
I.e. development of consortia , reduicing cost of product purchsing by using consortia.
Licences: local conditions, multiple sites.
Local content: DA working closely with publishers to include local content into their databases.

Expertise

• Understands both sides
  
  • Knows the market and understands the needs of the libraries
  • Knows what the publishers requires in a deal
    
    
• Posses well-honed negotiation skills
  
  
• Vested interested in the success of a deal
  
  • Leads to 'creative thinking' in finding solutions.

Choice

• Wide range of publishers
• Choice of products and databases - A&I, Ebooks, Ejournals, Doc Del
• Choice of formats - disks, CD-ROM, web
• Choice of payments, terms, currency
• Choice of customer service and technical support

Which model is best for?

• One price
• Tiered pricing
• A fixed price
• Variable price
• Bundling
• Units
• Open consortium
• Closed consortium
• Simultaneous users
• Site access
• Unlimited access
• Single or multiple databases
• Pay your subs, but see the rest
• Transactional access

Best consortium model?

• You decide!
  
  • Based on the factors that are important to your group
    
    
• Use all the resources available to you
  
  • Your colleagues
  • Your profession
  • Your agents