Objectives to Be Accomplished

The important fact is that there are numerous agents in the chain from the original creator of intellectual property to the ultimate user. And the creator-the author-may himself have divided interests. On the one hand, he may want to have the largest conceivable circulation of the work in question in order to spread his academic reputation. On the other hand-and this point is characteristically relevant only for books-he may want to maximize royalty income. Or, indeed, the

author may have a compromise solution in mind in which both royalty income and circulation get some weight.

Next in line comes the publisher who is well aware that he is selling a differentiated product that confers upon him some monopoly power: the demand curve for such products is downward sloping and raising the price will diminish the quantity demanded.^[6] The market motivations of commercial and not-for-profit publishers may not be very different, but in practice, commercial publishers appear to charge higher prices. Since print-based materials are difficult to resell (or copy in their entirety), publishers are able to practice price discrimination-that is, sell the identical product at different prices to different customers, as in the case of journal subscriptions, which are frequently priced at a higher level for libraries than for individuals.^[7] The naive view might be that a commercial publisher would charge a price to maximize short-term profit. But the example of Elsevier, particularly in its TULIP Project, suggests that the picture is much more complicated than that. While Elsevier's design of TULIP may not be compatible with long-run profit maximization, the correct interpretation of that project is still open to question.

Scholars and students want access to scholarly materials that is broad and inexpensive to them, although they do not much care whether their universities bear a large cost in acquiring these materials. On the other hand, academic administrators want to contain costs,^[8] perhaps even at the risk of reducing the flow of scholarly information, but also have a stake in preserving certain aspects of the journal and book production process (such as refereeing) as a way of maintaining their ability to judge academic excellence, even if this approach adds to the cost of library materials. The libraries, on the other hand, would like to provide as large a flow of information to their clients as possible and might seek the best combination of different library materials to accomplish this objective.

While none of us can clearly foresee how the actual prices for various types of electronic library products will evolve, there are two general ways in which electronic library products can be defined and two general ways in which they can be priced. Either the product itself can be an individual product (for example, a given journal, such as The Chicago Journal of Theoretical Computer Science, or a particular monograph, or even an individual paper or chapter), or it can be a bundle of journals or monographs with the understanding that the purchaser in this latter case buys the entire bundle or nothing. If the product is a bundle, a further question is whether the items bundled are essentially similar (that is, good substitutes for one another), as would be the case if one bundled into a single product 20 economics journals; whether the items bundled are sufficiently dissimilar so that they would not be good substitutes for one another, such as Project MUSE; or whether the bundle is a "cluster of clusters" in the sense that it contains several subsets that have the characteristic of high substitutability within but low substitutability across subsets, as is the case in JSTOR.^[9]

With regard to pricing, the vendor may offer site licenses for the product (how-

ever defined in light of the discussion above), which provide the purchaser with very substantial rights of downloading, printing, and so on, or charge the user each time the user accesses the product (known as "charging by the drink"). The principal difference here is not in who ultimately bears the cost, since even in the latter case universities may cover the tabs run up by their members. Two contrasting approaches, JSTOR and Project MUSE, are described in the papers by Kevin M. Guthrie (chapter 7) and Regier, respectively. In the case of JSTOR, both initial fees and annual maintenance charges vary by the size of the subscribing institution. Project MUSE, in addition, offers-not unproblematic-discounts for groups of institutions joined in consortia.