Knowledge Exchange Multinational Licensing Tender: New alliances?

1. Knowledge Exchange Multinational Licensing Tender:New alliances? Wilma Mossink SURFfoundation IFFRO Amsterdam

2. My story today in more detail • Introduction to the Knowledge Exchange • Tendering for content • background information to the multinational licensing tender • reasons for tendering • Innovative aspects • licensing aspects • business model • Some evaluative comments on proces & results • Conclusions

3. Knowledge Exchange and tender • Umbrella organisation with 4 sponsoring partners • Denmark’s Electronic Research Library (DEFF) • German Research Foundation (DFG) • Joint Information Systems Committee (JISC)   • SURFfoundation (SURF) • Intention to make a layer of scholarly and scientific content openly available on the internet • European tender procedure for a multinational, multi-year deal for different sorts of content important element • Tender aimed at new, creative ideas and concepts from smaller publishers willing to develop and try out innovate business models

4. Background information • Initial meeting in Bonn July 2006 created a framework (Bonn Accord) • publishers will continue to play an essential role in evaluating and distributing secondary literature • partner organisations currently use different models & strategies for the procurement of digital content on a national level • engagement for a joint pilot project to procure digital content • Working group meeting, September 2006 • question: how to frame joint activity? • legal issues (is Knowledge Exchange a cartel?) • timeframe issues (running deals) • transparency issues (confidentiality clauses) • proposal: joint tender

5. Reasons for tendering • Lack of innovation among publishers: • in creating new business models for electronic resources • in creating new access strategies for content • Tender creates a ‘virtual marketplace’ to engage the publishing community • Transparency for benchmarking national licences and framework agreements • Create a route to market for content often left out of national deals

6. The destination: agreements with publishers • April 2008 agreements with 5 publishers: • TheScientificWorldJournal: a hybrid open-access / fee-based online journal in the life sciences • MultiScience Journal: an aggregator of 34 engineering journals • BioOne: an aggregation of bioscience research journals run by a non-profit consortium • SWETS/ALPSP: a collection of 543 journals from 36 diverse publishers, in a single collection with a single umbrella licence, pricing model and delivery platform • Wiley InterScience OnlineBooks: a package of e-book offers from Wiley/Blackwell

7. The outcome of the tender • Denmark: • some expressions of interest • Germany • national licence for TheScientificWorldJournal & BioOne • United Kindom • national licence for TheScientificWorldJournal • Netherlands • national licence for TheScientificWorldJournal, MultiScience & BioOne

8. Innovative aspects: licensing structure • Overarching agreement between 4 partners of Knowledge Exchange & publisher • establishes rights & obligations between publisher & Knowledge Exchange partners • Agreement contains 4 annexes • Schedule A: Basic and extended list • Schedule B: Licensed material, types of licences & fees • Schedule C: Licence agreement • Schedule D: Support • Licence agreement • agreement regarding User Rights in respect of the Licensed Material between publisher and institution via Knowledge Exchange as intermediary

9. Innovative aspects: business model • Basic list • list representing research universities and larger teaching universities • Extended list • list defining affiliated higher education and publicly funded research institutions • National & multinational licence model • Opt in framework

10. Business model: innovative elements • Publishers asked to state • Final prices (no negotiation on fees) • Single fee for all institutions on basic & extended list for each country and for countries together • Opt in framework should show an innovative character: • discount structure based on participation through subscriptions in basic list • requirement to offer discount level to subscribing institutions in both lists • tiered pricing differentiating institutions in basic & extended list

11. Business models: suggestion • 4 different levels which refer to the discount offered to all institutions included in Basic and Extended Lists. • Discount structure is based on participation through subscription by institutions included in the Basic List • Level 0: No discount • Level 1: 45 % discount plus (for journals) 4% cancellation rate permitted for all subscribing institutions • Level 2: 60 % discount plus (for journals) 5% cancellation rate permitted for all subscribing institutions • Level 3: 80 % discount plus (for journals) 6% cancellation rate permitted for all subscribing institutions • Specification of number of subscribing institutions from the Basic List required to reach each level of discount. • Tiered pricing based on standardised model that applies to all institutions in the 4 partner countries to be specified by the publisher

12. Award criteria • 3 overarching criteria: • innovation and value for money offered by the proposal (40 %) • level of compliance with the access strategy (10 %) • fit of content to the academic strategy of the country (50 %)

13. What does KE offer the publishers • No allocated money but: • provisions for a route to market to 190 research universities & large teaching universities • endorsement and promotion of the bids to the libraries • provisions for a single point for contact resulting in better efficiency • provision central evaluation of contracts by legal experts • reduction in administration costs for the publisher

14. Disadvantages of the tender • Time consuming process • time frame of tender procedure itself • writing the several documents with severe deadlines • evaluating the bids by markers • Process rather inflexible: • careful structuring of bids needed • no further negotiations on prices/licences possible • bid is final bid but considerations could possibly influence bid • Takes up time & money of the organisations involved • strong commitment of the organisations needed • Still difficulties to estimate whether prices are fair • Libraries are offered content they have not asked for

15. Advantages of the tender • Ability to benchmark the prices • Higher degree of transparency • Reaching a group of interesting/unknown publishers which normally are not on the short- or longlist of consortia • Some innovative business models & access strategies • Worthwhile discounts especially on multinational level • Concept of national licences comes into view because of economies of scale • Model licence with most favourable provisions of the 4 countries • Test system for multinational negotiation and national implementation

16. The ride: the take up • Libraries have to be convinced of taking up the offers • price • content libraries have not asked for • ALPSP interesting example • not a very good offer for the institutions on basic list • too expensive for institutions on extended list • Wiley • take up slowly rises

17. The destination and the ride: the conclusion • Raised attention to other and new products • Created new business model that rewards multi-country participation • Increased transparency • Current framework useful for future licences • Created possibility to take an active part in shaping the market • Working together in a multinational context leads to better position for libraries

18. Thank you for your attention! KE Tender working group: • Anette Schneider (DEFF) (till October 2008) • Janne Vendt (DEFF) (from October 2008) • Max Vögler (DFG) (till October 2008) • Christoph Kuemmel (DFG) (from October 2008) • Hildegard Schäffler (Bavarian State Library) • Markus Brammer (German National Library on Science & Technology) • Lorraine Estelle (JISC Collections) • Nol Verhagen (University of Amsterdam/SURFdiensten) • Wilma Mossink (SURFfoundation/SURFdiensten)