In a move that continues its expansion into technologies and services supporting a diverse range of research activities, Elsevier has purchased bepress, a company best known for its repository solutions for academic libraries. Bepress, based in Berkeley, CA, offers a platform and services to support institutional repositories as well as a variety of tools to support editorial processes and to highlight and assess the impact of research publications. The acquisition of bepress represents Elsevier's latest investment in products outside its traditional role as a publisher of scientific literature. In recent years—likely in response to increased interest in open access, moderation of journal pricing, and other factors in the scholarly publishing industry—Elsevier has diversified its portfolio to include tools and services that tap into other aspects of the research process.
Its core product Digital Commons enables an organization to offer an institutional repository or journal hosting platform with hosting and support from bepress without the need for local servers or technical expertise. The company also offers a variety of other tools in support of managing scholarly and professional journals as well as organizing and featuring faculty research profiles. Bepress offers analytical tools supporting scholarly communications workflows, primarily oriented to green open access publications. Bepress characterizes its products and services as ways for researchers to share and feature their work.
Details of the Acquisition
The acquisition was announced on August 2, 2017 following a decision of its board of directors to offer the company for sale. The value of the business deal was not publicly disclosed. This transaction can be considered a strategic acquisition where the target organization offers potential synergies with the acquiring entity that it would not have as a standalone company. This type of transaction usually commands a higher value than a sponsored acquisition where investors, such as private equity firms and their bankers, bid on a company primarily based on factors such as EBIDA, annualized revenue, and perceived opportunities for income growth. As discussed below, Elsevier's acquisition of bepress fits well with its strategic interest in morphing its business as the dynamics of the scholarly publishing industry increasingly present challenges to the traditional subscription-based model.
All contacts and licenses that customer organizations have made for bepress products and services remain in place under their original terms. Organizations using Digital Commons retain ownership of the content hosted on the platform. This business transaction does not impact the legal status of documents hosted on Digital Commons or data on other products and services.
Bepress will operate as a wholly owned business unit of Elsevier. The executives and workforce of bepress will continue as employees of their new parent organization.
Community Reaction
The acquisition of bepress by Elsevier has generated considerable discussion in social media and discussion lists. Many express frustration that a company that was perceived as supportive to open access and to lowering the costs of access to scholarly literature has been absorbed by one of the largest and most aggressive publishers in terms of pricing models that have strained library budgets. Libraries opted to base their institutional repositories to host journals they produce on bepress as a hedge against the commercial publishing environment. Some have felt betrayed that their open access content hosted by bepress will now become part of the ecosystem of a major commercial publisher. This change of ownership cannot alter the legal status of the content managed within the bepress infrastructure. The organizations will continue to retain ownership and control of the content hosted on bepress. In addition to gaining the revenues for that service, Elsevier also gains indirect benefits, such as access and insight into use data and workflows. Open access advocates do not necessarily favor the expansion of Elsevier's sphere of influence into the realm of open access publishing.
Time will tell whether libraries using Digital Commons will accept its new ownership arrangement or shift to other options. Unlike the integrated library system (ILS) arena, migrating to a new institutional repository is relatively easy. Digital Commons supports the OAI-PMH protocol, enabling organizations to harvest content into other discovery environments or hosting platforms. Changes in ownership of ILS products have not resulted in significant exodus of customer libraries. Many of these factors may not apply to institutional repositories.
Bepress Organizational Background
Bepress was founded in 1999 by three professors from Stanford University—Robert Cooter, Aaron Edlin, and Benjamin E. Hermalin. The company was incorporated as “Internet-Journals, Inc.” but has done business as Berkeley Electronic Press, or more recently bepress.
Jean-Gabriel Bankier joined bepress as its President and Chief Executive Officer in January 2010 and retains this role following the acquisition.
Bepress is based in Berkeley, CA and currently employs around 75 personnel, with about 20 persons involved in technology and development. The company earns an estimated $20 million in annual revenue.
Berkeley Electronic Press as an Alternative E-Journal Publisher
The initial activity of the company involved the publication of e-journals. The company emerged at a time when serials pricing was considered to be a major crisis for libraries and their academic institutions. Berkeley Electronic Press aimed to produce new or acquired e-journals at far lower costs than the contemporary commercial players. Berkeley Electronic Press was successful in developing a stable of journals across a variety of academic disciplines. These journals published by Berkeley Electronic Press were primarily in the areas of law, economics, business, natural sciences, and humanities. The company exited its involvement in the direct publication of e-journals shortly after Bankier took the reins of the company. Bepress sold its 67 journals to De Gruyter in September 2011. De Gruyter is based in Berlin, Germany and currently publishes around 700 journals and 1,300 scholarly monographs annually.
It is interesting to note that in this phase of its business Berkeley Electronic Press divested its content portfolio in favor of its hosting platform and editorial workf low solutions. This contrasts with the current phase of content providers expanding their reach into resource management and workf low solutions. Elsevier's recent acquisitions are one example; ProQuest's acquisition of Ex Libris, and EBSCO Information Systems' support of FOLIO can also be seen as part of this trend.
Repository Platforms: eScholarship and Digital Commons
Berkeley Electronic Press leveraged its expertise in e-journal hosting to develop a general purpose institutional repository hosting platform. This platform saw two early implementations— the eScholarship repository for the California Digital Library and the Digital Commons created for ProQuest.
The California Digital Library engaged Berkeley Electronic Press in October 2001 to help develop the platform for its eScholarship repository, which aimed to collect and provide access to the working papers, preprints, and other scholarly publications of researchers throughout the University of California system. This project represented one of the most ambitious repository projects, serving all 9 campuses of the University of California and the California Digital Library (CDL). eScholarship launched in August 2002 and continues today under the Publishing Group of CDL. According to statistics stated on the organization's website, the repository currently hosts almost 150,000 publications.
Berkeley Electronic Press also developed a version of its content hosting platform for ProQuest, which marketed it as Digital Commons as a commercially supported institutional repository solution. Work on the project began in December 2002, with the platform operational by June 2004. Early adopters of the ProQuest Digital Commons service included the University of Pennsylvania and the University of New Brunswick.
During this period, Digital Commons was offered as a product of ProQuest, which held exclusive rights to market the product. Berkeley Electronic Press continued its role in product development and support and received a commission of the revenues generated. This arrangement changed in July 2007 as bepress announced it would begin direct sales of Digital Commons. A subsequent announcement the next month reported that Berkeley Electronic Press had acquired full rights to the Digital Commons platform from ProQuest. From that time forward, Berkeley Electronic Press expanded its sales and support staff in support of Digital Commons as its core business activity. By the time of its acquisition by Elsevier, bepress had licensed Digital Commons to over 500 institutions.
Editorial Workflow Products
Berkeley Electronic Press also created a product based on the manuscript submission and editorial tools it had created, branded as EdiKit. This product has been licensed by a number of scholarly and professional associations to help them manage their journals. In June 2003, the American Finance Association became the external organization to license EdiKit.
ExpressO is a manuscript processing service for law reviews that automates the submission, review, and editing workflows. This product was initially launched in July 2003 and has become well established as a specialized tool for managing the complete editorial process involved in law reviews.
The Expert Gallery Suite is a set tool to track, manage, and showcase the publications and research activities of individuals and organizations. Announced in February 2016 as SelectedWorks, this service enables the library to curate faculty profiles, which features their areas of expertise and publications. It includes analytic tools to track and assess the readership and impact of faculty research.
Institutional Repository Competitors
Over 500 libraries have implemented Digital Commons, with the majority based in the United States and Canada. While bepress is the main commercial provider of institutional repository services, a much larger number of libraries have implemented repositories based on open source products. DuraSpace coordinates the development and support for DSpace and Fedora and maintains a registry of implementations. This registry indicates that about 2,000 organizations have implemented DSpace and 250 have repositories based on Fedora (http://www.duraspace.org/registry/). It is likely that these numbers underrepresent the actual implementations.
As a fully hosted repository, Digital Commons provides a service to organizations that either do not have interest or expertise in the implementation of one of the open source products or that choose to allocate their technical capacity to other projects. Although there are also organizations that provide support and hosting for the open source products, bepress had established a reputation as having strong customer service for a repository product with better features and usability for content submission, presentation, and discoverability.
Elsevier Company Background
From Elsevier's perspective, the acquisition of bepress can be seen as a strategic business move. The company has purchased other companies and products to deepen its involvement outside its traditional subscription-based content portfolio. Bringing institutional repositories into its fold enables it to tap into yet another aspect of the complex ecosystem of scholarly communications.
Elsevier ranks as one of the largest scholarly publishing conglomerates globally. The company began as a small Dutch publisher in 1880. It has a complex history of mergers and acquisitions, which eventually led it to become established as the dominant provider of scholarly content, including some of the world's most prestigious publications. Elsevier is owned by RELX Group, which was known as Reed Elsevier until February 2015. RELX Group is in turn owned by London- based Reed Elsevier PLC and Amsterdam-based Reed Elsevier NV. The RELX Group 2016 annual report indicated Ł6,895 million in net revenues (about $8.88 billion in today's US dollars).
Elsevier is well established as a publisher of scholarly journals, which still represent the majority of revenue for the company. The journals offered by Elsevier are made available through ScienceDirect, a consolidated content platform delivering access to books and journal articles published by Elsevier. Elsevier has also created Scopus, a citation database of scholarly literature selected from selected high-quality publications from many publishers.
Involvement in Other Research Platforms
Elsevier has in recent years purchased companies and products within the general sphere of scholarly communications in addition to acquiring additional e-journals and scholarly monographs. Some examples of Elsevier's acquisitions in this area include:
- Mendeley, a major research collaboration platform designed to help researchers and students organize, share, and discover research resources. The service was originally launched in 2008 as a privately funded startup. Elsevier acquired Mendeley in April 2013.
- Pure, a research information management system. This product was developed by Atira A/S, which was acquired by Elsevier in August 2012.
- Social Science Research Network, or SSRN, was acquired by Elsevier in May 2016. This platform operates essentially as a social network for researchers, enabling collaboration and sharing of articles and works in progress. At the time of its acquisition by Elsevier, the platform had over two million participants.
- NewsFlo, which Elsevier acquired in Jan 2015. It's a service that tracks news coverage of researchers to help measure their impact. NewsFlo monitors over 55,000 primarily English news sources. Based on this monitored content, the service is able to highlight trends in coverage and produce alerts. The service was initially created in 2012 by a group of physicists at Imperial College London.
- Plum Analtyics, which helps measure the impact of research by tracking many types of interactions, including direct downloads, blog posts, mentions in social media, in addition to traditional measures such as citations in books or articles. Plum Analytics was founded in 2012 by Andrea Michalek and Mike Buschman to create services in the increasingly important altmetrics arena that assess the impact and value of publications on measures beyond those based on traditional factors such as citations and access counts. The company was acquired by EBSCO Information Services in January 2014. In February 2017, Elsevier acquired Plum Analytics EBSCO. Elsevier announced in July 2017 that Plum Analytics metrics have integrated into Scopus, Pure, and the journals published on elsevier.com. Integration with ScienceDirect is underway.
The scholarly publishing sector currently finds itself in the midst of tremendous pressures. Open access publishing models have been gaining ground for many years. But the pressures to move quickly away from subscription-based access seems unprecedented. Many national and funder-based initiatives mandate that research results be published as open access. Academic institutions increasingly have less tolerance for a business model funded by libraries purchasing subscriptions for the output of publicly funded research. The window of opportunity for this business model may be closing. Some major libraries have terminated longstanding license arrangements, and some groups of researchers have boycotted involvement with commercial publishers. In an environment where it will be increasingly difficult to monetize content according to long-established subscription business models, companies interested in long-term survival will need to reinvent themselves based on new sources of revenue. Elsevier's acquisition of bepress is the latest—but likely not the last—in a series of moves to shift toward transactional revenue sources rather than subscriptions.
Sidebar: The Endeavor Chapter
Elsevier had made an earlier foray into the library workflows arena with its ownership of Endeavor Information Systems. Endeavor was founded in September 1994 by individuals formerly associated with NOTIS Systems, which had been acquired by Ameritech Library Systems. Shortly after its founding, Jane Burke joined as its President and Chief Executive Officer (June 1995). The company's Voyager ILS found rapid acceptance among academic libraries and eventually became established as one of the leading products in that sector. By December 1997, 100 libraries had selected Endeavor's Voyager ILS; by 1998, that number exceeded 350. The Library of Congress placed Voyager in production in October 1999. In April 2000, Elsevier acquired Endeavor from its founders. At the time, the company had 131 employees, and its Voyager ILS was used in over 650 academic libraries.
Under Elsevier's ownership, the number of academic libraries using Voyager continued to grow, gaining wide acceptance in the academic library sector. Ex Libris Aleph was as one of its key competitors. By 2004, 1,200 libraries had selected Voyager.
Endeavor also produced technologies related to electronic resource management and access. These products were of particular interest to Elsevier and received more development attention than the Voyager ILS. Endeavor expanded its product line to include the ENCompass product for managing digital collections system and providing access to subscribed electronic resources. The ENCompass for Journals OnSite was introduced in February 2004, enabling libraries to securely manage local copies of their electronic journal collections rather than access them via the internet. This product succeeded the ScienceServer platform, which Elsevier had previously developed for local hosting of electronic journals.
The genre of commercial OpenURL link resolvers began in 2000 with the launch of SFX by Ex Libris. Endeavor joined the competition with its LinkFinderPlus in 2001. The Meridian electronic resource management system was launched in June 2004, but failed to receive wide adoption.
This chapter in Elsevier's involvement in the library automation systems ended in November 2006 when it sold Endeavor Information Systems to the private equity firm Francisco Partners, which merged the company with Ex Libris, which it had acquired in June 2006. This six-year period ultimately did not make a major impact on either the library automation industry or the scholarly communications sector. Many of the synergies possible today are enabled through converged workflows of print and electronic resources and cloudbased technologies.
My article analyzing the acquisition of Endeavor by Elsevier makes observations at that time that bear remarkable similarity to the trends playing out today. Although the effort turned out not to be sustained, it is notable that even at that time Elsevier was exploring synergies between resource management and access technologies and its content products.
We have long seen a trend toward horizontal consolidation in both the library automation marketplace and the publishing business. The marketplace now seems to demand a smaller number of strong competitors that can achieve lower costs through economies of scale. Companies that can do so gain strength through acquiring the customer base and technologies of their competitors. But the acquisition of Endeavor by Elsevier Science leads the way toward vertical consolidation as well. From the library automation company's perspective, it may no longer be enough to provide a solid integrated library system. As library automation systems become mature, the points of differentiation will lie in the opportunities the companies can offer in the delivery of fulltext content. This new level of consolidation and convergence will certainly alter the landscape. Given that libraries generally share the vision of an integrated information environment, such alliances will likely result in better tools and technologies toward meeting these goals. It will also likely result in creating some unlikely and uncomfortable bedfellows.1
References
- Marshall Breeding, “Consolidation and Convergence: Elsevier Science Acquires Endeavor Information Systems,” Information Today 17, no. 5 (May 2000), https://librarytechnology.org/document/7905.
