on 1 Jun 2006 Kim Maxwell <kmaxwell@MIT.EDU> wrote:

> I could easily be wrong about this, so please no one quote me.  But I think
> the institutional price is the "real" price of the subscription, and the
> individual price is deeply discounted so that individuals can purchase their
> own copies.  If someone out there knows better than I, please do correct me.

	Having studied prices of a number of publishers,
	I would say this is essentially correct. Projections
	forward are based on the institutional price. The
	member or individual prices need cover only the
	added cost of producing and mailing an additional
	copy.

	Practical approaches to this theory may vary. ACS in
	the 1970s set its member prices at 1/4 the
	institutional prices. As a membership organization, it
	enforced anti-leakage of member copies as a member
	benefit with possible loss of membership as a penalty.

	ACS was sued by IRS, who claimed the discount was
	'inurement,' jeapordizing its nonprofit status. It
	was rumored that university lobbies were behind the
	IRS complaint.

	To make a long story short, the IRS lost.

	My analysis of the consequences, if the IRS had won,
	was that there would be no more subscriptions at the
	member price. In other words, the institutional price
	is the 'real' price.

On Behalf Of Thomas, Susan Elaine wrote:
>
> Has anyone ever asked why libraries are asked to pay more in
> the first place?  Why are publishers allowed to charge
> libraries more?  Is the product that libraries receive
> somehow more enhanced than the individual subscription?  Is
> it in a better binding?  Are libraries essentially being
> asked to pay more for the same product because we never said
> no to the higher rate in the first place?  Has anyone tried
> to say no to the institutional rate?  What would happen?
> Would the publisher say I am not sending you the
> subscription?  What if we all said no collectively?

	The research universities that dominate spending
	on scientific journals started cutting their
	library budgets around 1970, resulting in
	thousands of subscription cancellations.

	Publishers, faced with exponential increases in
	journal articles, simply raised their rates to
	cover increased production + CPI + the declining
	value of the dollar.

	I think the question should be: Why are science
	libraries not recognized in the nation's growing
	science R&D spending?

	Best wishes,

Sincerely,

Albert Henderson,
former Editor PUBLISHING RESEARCH QUARTERLY 1994-2000.