Serials Prices 2004-2008 with Projections for 2009 June 10, 2008
Serials Price Projections and Cost History

2009 Price Projections
In today’s world, planning for the future is a vital element of success. EBSCO helps our customers plan by projecting publisher price increases for the upcoming year as early as possible. We use recent information received from both large and small publishers and historical price data to calculate these projections. Caution should be exercised when using these projections as we must rely on historical trends and current estimates. Overall, the pricing information received as of the date of this release indicates base publisher price increases for 2009 will be slightly higher than those of 2008. The projected base price increase (before currency impact) for academic and academic medical libraries is seven to nine percent.

Pricing Factors
Many factors affect serials prices each year. For example, in each of the past two years, the U.S. postal service has increased rates which has in turn, impacted the price of print journals. Other factors include changes in pricing models, increases in pages and/or volumes, and overall inflation.

Whether the content is packaged, sold via standard tier pricing or through customized deals, publishers are looking for the best way to cover costs and maximize profits. This can often lead to significant price increases overall, with smaller price increases at the individual journal level. For example, bundling or packaging titles often translates into the concept of “more for pro-rata less.” The result is a lower price per title but an overall increase in expenditure. Prices per title may go down, but overall spend may outpace normal journal inflation.

Currency Impact
One of the most significant factors to price increases continues to be the fluctuations of the world’s currencies. These rates are volatile and make it especially difficult to project their impact on publisher prices. For example, over the past twelve months, the U.S. dollar has weakened against the euro, but strengthened against the pound. The U.S. dollar is roughly eight percent weaker today against the euro and five percent stronger against the pound than in the fall of 2007 when customers were invoiced and publishers were paid.

This is the third consecutive year of the dollar weakening versus the euro. The decline of the dollar against the euro over the past 24 months has been roughly 20 percent. Conversely, this is the first year of strengthening against the pound. Opinions vary as to what direction the dollar will take next. Many questions to be answered in the coming months could determine that direction. Among those are: Will the Federal Reserve continue to cut interest rates? How high will oil prices rise? Who will be elected the next President of the United States in November? Once these questions and others are answered, the direction of the dollar and overall economy will become clearer.

Anytime the value of the dollar declines relative to other currencies, this is positive news for customers outside the United States purchasing U.S. dollar priced journals. For example, customers whose invoicing currency is euros would likely see price increases below the base increase for U.S. journals. Conversely, the weak U.S. dollar could result in higher price increases for U.S. customers buying material priced by publishers in non-U.S. currencies.

Customers in Australia and New Zealand should see price increases at or below the base increase for materials priced in U.S dollars due to the strengthening of these currencies versus the U.S. dollar. However, customers in South Africa may see price increases for European materials at or above the base increase due to the decreased value of the rand versus the euro and pound.

Based on the value of the U.S. dollar at the time of this writing, we estimate overall price increases of 14 to 16 percent for customers paying in U.S. dollars for euro priced titles (this is relative to the euro versus the value of the U.S. dollar as of late 2007, when orders and payments were sent to publishers and mid-2007, when many of the larger non-U.S. publishers set U.S. dollar prices). The estimated increase in overall prices for titles priced in pounds is three to five percent.

It is important to note that a relatively small percentage of non-U.S. titles are priced by the publishers in non-U.S. currencies for the U.S. market. Most of the large international publishers that have been traditionally thought of as “European” set their prices in U.S. dollars for the U.S. market. Therefore, in more recent times, these price increases have been less impacted by the rise and fall of the U.S. dollar versus the euro and the pound each year.

See the following chart, Projected Price Increase by Customer Billing Currency, for more information. Generally, an increase of more than seven to nine percent reflects an adverse currency impact, and an increase of less than seven to nine percent reflects a favorable currency impact.

Conservative Budgeting
EBSCO recommends customers add two to four percent to the estimated price increases when budgeting to protect themselves from a weakening of the currency in which they are invoiced between now and the time subscription payments are paid. The currency exchange environment is difficult to project. EBSCO continually communicates with major publishers regarding projected price increases and monitors world currency exchange rates. Should we see major developments in these areas, we will update our information regarding projections, and proactively communicate this to you.

As mentioned above, these price projections are for individual print and electronic journals. The figures do not consider overall spending related to purchasing e-packages, which may result in spending increases above the averages presented in the table.

Historical Price Data by Library Type
The chart Five Year Journal Price Increase History (2004-2008) (PDF file) shows price fluctuations over the last five years for typical library lists invoiced in U.S. dollars. Data for each library type is based on a merged list of titles ordered by representative libraries purchasing in U.S. dollars. Each list is based on actual ordering patterns of the libraries in the sample.

An analysis of 2008 subscription prices for customers paying in U.S. dollars indicates an average increase over 2007 prices ranging from 3.34 to 9.75 percent. Association of Research Libraries (ARL) institutions experienced an average price increase of 8.52 percent; college and university libraries experienced an average increase of 8.87 percent; and academic medical libraries experienced an average increase of 8.91 percent. These figures are based on a weighted average of the actual ordering patterns of a significant number of representative libraries purchasing both U.S. and non-U.S. titles in U.S. dollars.

Other Budgeting Tools
EBSCO provides price projections to assist customers in forecasting the effect of future serials costs on their budgets. These projections should be used as one tool in the budgeting process. EBSCO offers other budgeting and collection analysis tools that provide information specific to a customer’s collection. Some of the serials management reports offered are:

• The Historical Price Analysis report, which tracks the cost of all titles ordered through EBSCO over a specified period of time and provides percentage-of-change comparisons;
• The Customized Budget Analysis report, which provides specific price projections for customers’ titles ordered through EBSCO;
• The Online Availability Report (with estimated prices), which lists journals on order with EBSCO that are available online either in combination with or separate from the print subscription (displays each publisher’s access requirements and the institutional rate for the online journal); and
• Collection Development and Assessment Reports, which allow customers to evaluate the importance of particular titles to their collections.

Please contact the EBSCO Regional Office nearest you for more information about these reports.