Journals Nonsubscription Revenues
Journals revenues have traditionally come mainly from subscription revenues. However, other sources of income do exist and may indeed become increasingly important in the future. Below are brief descriptions of the other possible sources of journals income.
Single Copy Sales
Income is often derived from the sale of single copies of both current and back issues. It is standard for a press to print the number of copies it expects to need for a period of five years from the time of publication, including copies for both single-copy and subscription sales. (The publisher's policy on sending grace issues is important to remember when setting print runs for issues early in a journal's volume publication cycle.) Issues usually sell most heavily in the first year after publication, after which sales fall off rapidly. However, special issues may continue to sell over the long term, and the need to print additional copies should be considered.
Some journals have a market in bookstores and newsstands. These are generally sold under terms similar to those applied to books, either through special distributors or through direct order from bookstores, with most distributors requesting full credit for affidavit returns. Single issues should be priced higher than the subscription per unit price in order to encourage subscription ordering. Although the income from such sales is lower per unit than with subscription sales, because discounts are taken by both retailers and distributors, there is an important promotional value to placing journals in these bookstores and newsstands. It is advisable to include a blow-in card or tear-out order form in these copies to facilitate ordering of subscriptions. Bookstores increasingly require a UPC code be printed on all journal issues.
Scholarly journals also have the potential to sell advertising space. Prices are usually set on a per-page basis by journal, frequently with a discount offered for multiple placements in the same journal. Generally, this is not a large percentage of income for scholarly journals. Success in selling advertising is largely dependent upon size of the subscription list and the special niche the journal occupies. Ads are sold directly and also through advertising agencies, which generally request a standard 15 percent discount. (Not all presses allow these discounts, however.) Ads are billed and collected after the issue has been published. Since this is generally a small amount of money, publishers usually record the income on a cash basis as payments are received, rather than accrue receivables. However, there should be a follow-up procedure to make sure such amounts are collected.
While sale of advertising space to publishers and others whose ads relate directly to the informational and educational mission of a journal is clearly permissible, sale of advertising space to commercial advertisers with products not directly related to a journal's content (for example, to airline companies in a journal of international affairs) may create problems related to Unrelated Business In come Tax for nonprofit publishers. In cases of doubt on this matter, legal advice should be sought by the press.
Publishers may choose to rent a journal's mailing list to other publishers promoting their products. This is handled in a similar fashion to advertising, but prices are usually set on a per- name rather than a per-list basis. Publishers may order direct or through a list broker. Brokers expect to receive a discount of up to 20 percent for handling the transaction. Again, since this is usually a small portion of income, most presses recognize the income when it is received rather than carrying a receivable until the payment is collected.
Journals publishers may offer offprints of journal articles to authors or the general public. Offprints are usually produced as overruns of the issue printing but are sometimes done separately through special reprint shops. Some printers have reprint businesses whereby they sell bulk copies of articles and give the publisher a portion of the income.
If offprints are offered, authors are asked to order at some point in the production process. Payment at that time is encouraged, but frequently authors pay through purchase orders from their universities. Most presses recognize this income when it is received rather than carrying a receivable until the payment is collected.
In some disciplines, authors are accustomed to paying page charges, which help to defray the cost of publication. This usually occurs when the author has grant funds supporting his or her research that can be used to support publication. In some fields, voluntary page charges are acceptable.
There are a number of subsidiary rights arrangements that can generate income for the press: microfilm/fiche arrangements, photocopying per missions, reprint permissions, CD-ROM subsidiary rights arrangements, commercial document delivery, and (potentially) electronic distribution rights. The percentage of royalties from subsidiary sales given to the publisher varies, but this has the potential to become a bigger portion of income in the future as new rights opportunities become avail able. Tracking and managing permissions and subsidiary rights is a very time-consuming process, however, and presses should not expect to be able to do it well without allocating considerable staff time to it (including managerial time to figure out how, in these times of change, these matters should best be handled). The key to having the opportunity to generate income from this source is receiving the copyright and all subsidiary rights from the author. The copyright transfer form should be carefully drawn in order to enable the press to disseminate the journal's articles through these subsidiary forms of publication. In cases where a press allows an author to retain copyright, it is important to have a nonexclusive form that still allows the press to license these subsidiary forms. Endless complications can result from permitting multitudinous exceptions and variations to interfere with otherwise straightforward blanket agreements.
There are many secondary companies that produce microfilm/fiche editions of journal issues, photocopies of articles, and indexing publications (hard copy, CD-ROM, etc.). Increasingly, these companies are developing products that include full text of articles. Payment for such licenses (which can usually be made nonexclusive) is usually in the form of an annual payment of a royalty on net sales. Blanket contracts can be signed with these companies for a press's entire journals list, or they can be done on an individual publication basis. Contracts do not have to be accepted in the form offered by the company. Alterations to terms can often be negotiated.
Photocopying permissions are usually paid on a per-article basis rather than a royalty basis. Either a charge per article can be set or a charge per page per copy. Again, blanket contracts can be made with some of these suppliers (Kinko's, NACS) and can even take into account articles that are exceptions for which the publisher does not have the rights. Commercial document delivery services are now being developed that will pay the publisher a per-article fee as photocopies are generated and faxed to the end user.
Electronic rights are coming more and more into play at the time this is being written, but no consensus on how to handle them has emerged to date. It does appear important for publishers to get these rights from authors, to be cautious about exclusive arrangements at this early stage, and to consider licensing such rights for initial two- to three-year trial periods.