Business Models and Funding Models for Open Access E-books

On Business Models and Funding Models for Open Access E-books:  We have only just left the starting line.

During our plenary session on Blurring Lines in the University Library at the Charleston Conference in November, I asked Rick Anderson if university libraries moving into book publishing would necessarily bring with it business model innovation in open access publishing. Rick’s answer was that it depends on the university’s mission and objectives. I suspect the answer is more straightforward than this because I believe almost any university that moves publishing into the library, or begins a new monographic publishing program from the library, is deeply engaged with open access as a major objective. But this positioning on the question by Rick and my alternative response is indicative of the fogginess about the way forward in open access ebook publishing.

The way forward in open access publishing in the journal world is much clearer. Journals went digital before books and demand for open access journals has grown rapidly and driven a reasonably uniform business model response from publishers that is based on author submission fees, open archives of pre-publication versions of articles, and hybrid purchase models for libraries that combine author submission fees with discounted subscription fees. I don’t want to suggest that there is not ample opportunity for business model innovation in the journal world, but when compared to the world of ebooks, where the way forward is much less clear, journals have found an open access business model that provides a widely accepted context for framing discussion. In this column I will explore existing and emerging business models for open access ebook publishing and make some observations about the need for as-yet undiscovered revenue-generating business models to push open access ebook publishing forward in a more broadly accepted context.

There are four current models for open access ebook publishing that have gained enough momentum to be considered sustainable if not widely accepted. They are: 1) foundation and/or institution funded, 2) “freemium,” 3) crowd funded (either by individuals or institutions) and 4) author fees. I will discuss each of these in turn.

Foundation and/or Institution Funded

Funding for open access ebook publishing has come from state-led legislation, as in California for open e-textbooks, from Universities such as the Open Stax initiative at Rice University and from numerous non-profit and other organizations dedicated to underwriting the advancement of knowledge such as Open Access Publishing in European Networks (OAPEN), which is focused on scholarly works in the humanities and social sciences. These many founts of underwriting the cost of open access publishing and distribution share a common commitment to the advancement of a social good. In the humanities and social sciences, where scholarly monographic publishing matches or trumps journal publishing in terms of importance for career advancement for scholars, these initiatives take on major importance for the professorial community. But foundation and government funding is a limited resource that ebbs and flows significantly with turns in the overall economy, the capriciousness of donors and changes of strategic direction in the foundations and government organizations that do the underwriting.  And this model suffers from an even greater liability in terms of attracting the very best authors. Top faculty talent, especially for the authoring of classroom material, are looking for meaningful financial return for their efforts; and the profit-motive does not align easily with governmental and foundation funded publishing efforts.


The “freemium” model of open access ebook publishing has been expressed in a number of variations, especially with textbooks and fiction publishing. In the textbook space the approach has been based on offering a static, low-resolution version of an e-textbook open access and then hoping to upsell to a more interactive, study-tool enabled version of the ebook.  At Flat World Knowledge (FWK), a previously open access textbook publisher, an open access version of the textbook in html was available for reading and manipulation through a creative commons license. This was at the heart of the FWK business model and mission. In January of this year FWK changed course and no longer offers a free version of the e-textbook. Boundless, however, continues with a similar model albeit the free versions of e-textbooks are not readily visible on the website and require a bit of digging. Boundless has made the open access version of many of its e-textbooks less central to its marketing message but still maintains a commitment to offering an open access experience.

Other examples of freemium e-book publishing seem to be limited to the world of fiction where self-published authors (known and completely unknown) have chosen to serialize content with early postings delivered open access and then instituting a pay-wall once a critical mass of readers has been reached. This model has been widely used in China by Shanda Literature and others. Better known authors have allowed open access to some of their work in order to entice new readers willing to pay for subsequent published works. The freemium model has, I think, a largely untapped future and merits more attention in the scholarly and trade publishing world, especially in those fields where monographic publishing can reach beyond scholarly audiences.

Crowd Funding

Crowd funding, via the web, is being used in creative ways to raise capital for everything from new businesses to community building projects and, of course, open access ebook publishing.  We have only just begun to experiment with the various ways in which crowd funding can be used to construct a direct funding model for open access ebook publishing or become part of a hybrid business model to propel open access forward.  Two organizations, both operating with a focus on scholarly monographs, have emerged to test the crowd funding model., founded by Eric Hellman, works with authors and publishers to establish a funding goal and “book lovers chip in to meet it.” After the funding goal has been met the ebook becomes open access for all. Knowledge Unlatched has taken a slightly different approach. Rather than crowd funding from essentially anonymous individuals, Knowledge Unlatched is seeking a minimum of 200 library members for its pilot collection of ebooks. Once the membership target is met, the ebook collection becomes open access for all. If more than 200 libraries want to participate the then cost per institution reduces proportionately. Strictly speaking, this is a membership-funded model and not necessarily the same as an anonymous, individual-reader focused model, as with But the concept of setting a revenue goal after which the ebook or ebooks become open access is consistent with the principle of crowd funding.

Author Fees

This is the most well-known model, drawn directly from the experience gained in the journal world. Palgrave/Macmillan notes on their website that they “… are taking the lead in responding to the academic community’s request” to offer the open access model across three publication outputs: journal articles, mid-form and long-form research with an author-fee model. I suspect this will become the norm as, I noted above, the author fee (Gold OA) has become the starting point for almost all discussions about open access in journal publishing and it seems logical this will extend to monograph publishing, especially for those publishers with journal and book programs.

A Revenue Generating Future

The type of output may well go a long way in determining the model used most widely to bring open access ebooks to the library. Scholarly works, especially scholarly works that have little or no revenue-generating potential beyond the library, will provide fertile testing ground for crowd-funded models that build in some author remuneration. E-textbooks, with the potential for wide global adoption and use, provide ample space for experimentation with business models that combine crowd-funding and freemium plays. But I think it is too easy to draw a line between scholarly content and learning content and suggest that the two necessarily require different business models to fully propagate open access. We should be scanning the university and library business environment constantly for new approaches to open access ebook publishing that have a monetization model at their core. We need a model that fairly rewards authors for writing, publishers for vetting, curating and bringing to market and ensures as affordable a price as possible for all university libraries world-wide. And I believe we need to break down the walls between scholarly, professional and learning ebook publishing to uncover a business model that drives us forward.

David Parker

David Parker

David Parker is head of business products for Alexander Street Press, the leading provider of multi-media databases to the global university library market. David founded Business Expert Press and served as the President of its sister company, Momentum Press. BEP and MP specialize in applied, concise ebooks for advanced business and engineering students. Prior to that, David was editor-in-chief for business publishing at Pearson Education. David holds a bachelor’s degree in international studies from George Fox University and a Master’s Degree in anthropology from the University of Arizona. He has also completed executive education at City University Seattle and the University of Chicago. David serves on the publisher’s advisory board to SIPX (Stanford Intellectual Property Exchange).