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Chapter 7— JSTOR The Development of a Cost-Driven, Value-Based Pricing Model
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Defining The "Product"

Although JSTOR does not have to repay initial investments, it must have a mechanism to recover its ongoing costs. In developing a plan for cost recovery, our first step was to define exactly what it is that our "customers" would pay for-what is the "product"? On the face of it, this step sounds simple, but it is anything but that, especially given the rate of change of technology affecting the Internet and World Wide Web. For example, those publishers reading this paper who are working to put current issues in electronic form will know that even choosing the display format can be extremely difficult. Should the display files be images or text? If text, should they be SGML, PDF, HTML, SGML-to-HTML converted in advance, SGML-to-HTML converted on the fly, or some combination of these or other choices? The format that is chosen has far-reaching implications for present and future software capabilities, charging mechanisms, and user acceptance. It is easy to imagine how this decision alone can be paralyzing.

For nonprofit institutions like JSTOR, a key guidepost for making decisions of this type is the organization's mission. Nonprofits do not set out to maximize profits or shareholder wealth. In fact, they have been created to provide products or services that would not typically be made available by firms focused on maximizing profit. Consequently, not-for-profits cannot rely solely on quantitative approaches for decision making, even when such decisions are quantitative or financial in nature. Without such tools, having a clearly defined mission and using it to inform decisions is essential.

A good example of how JSTOR has relied on its mission for decision making is the question mentioned briefly above-choosing an appropriate display format.


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We have decided to use a combination of images and text for delivery of the journal pages. We provide the images for display-so a user reads and can print a perfect replication of the original published page-and in the background we allow users to search the full text. This decision has been criticized by some people, but it is an appropriate approach for us, given the fact that our goal is to be a trusted archive and because JSTOR is now chiefly concerned with replicating previously published pages. There would be benefits to tagging the full text with SGML and delivering 100% corrected text files to our users, but because we also are committed to covering our costs, that approach is not practical. We are building a database of millions of pages and the effort required to do so is enormous. Digitizing even a single JSTOR title is a substantial undertaking. I have heard some people wonder why JSTOR is including "only" 100 journals in its first phase when other electronic journal initiatives are projecting hundreds, even thousands of journals. Presently, the 20 JSTOR journals that are available on-line have an average run of more than 50 years. So any calculation about the effort required for converting a single title needs to be multiplied 30 to 50 times to be comparable to the effort required to publish an electronic version of a single year of a journal. That imposes very real constraints.

Having a clear understanding of our fundamental mission has also allowed us to remain flexible as we confront a rapidly evolving environment. Trying to keep up with the technology is a never-ending task. We work hard to remain open to change, and at the same time we are committed to using the appropriate technology to fulfill our objective-no more, no less. Progress can grind to a halt quickly when so much is unknown and so much is changing, but our simple goal is to keep making progress. We recognize that by pushing forward relentlessly we will make some mistakes, but we are convinced that we cannot afford to stop moving if we are to build something meaningful in this dynamic environment.

So we established goals consistent with our mission and have made adjustments as we have gained experience. As mentioned previously, one of our fundamental goals is to serve as a trusted archive of the printed record. That means that output produced by the database has to be at least as good as the printed journals. A key determining factor in the quality of JSTOR printouts is the initial resolution at which the journal pages are scanned. Our original inclination was to scan pages at a resolution of 300 dots per inch (dpi). Anne Kenney[1] was a key advocate for scanning at 600 dpi when most people advised that 300 dpi was adequate and 600 dpi too expensive. Kenney made a strong case that scanning at 600 dpi is not just better than scanning at 300 dpi, but that, for pages comprised mainly of black-andwhite text, there are rapidly diminishing perceivable improvements in the appearance of images scanned at resolutions greater than 600 dpi. It made sense, given the predominance of text in our database, to make the additional investment to gain the assurance that the images we were creating would continue to be acceptable even as technologies continued to improve. We are pleased that we made this


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choice; the quality of output now available from the JSTOR database is generally superior to a copy made from the original.

Another illustration of how it has been important for us to remain flexible concerns delivery of current issues. In the early days of JSTOR, several scholarly associations approached us with the idea that perhaps we could publish their current issues. The notion of providing scholars with access to the complete run of the journal-from the current issue back to the first issue-had (and has) enormous appeal. On the face of it, it seemed to make sense for JSTOR also to mount current issues in the database, and we began to encourage associations to think about working with us to provide both current issues and the backfiles. It was soon evident, however, that this direction was not going to work for multi-title publishers. These publishers, some of which publish journals owned by other entities such as scholarly associations, justifiably regarded a JSTOR initiative on current issues to be competition. They were not about to provide the backfile of a journal to us only to risk that journal's owners turning to JSTOR for electronic publication of current and future issues. Again, we had to make adjustments. We are now committed to working with publishers of current issues to create linkages that will allow seamless searches between their data and the JSTOR archive, but we will not ourselves publish current issues.[2] If we are to have maximum positive impact on the scholarly community, we must provide a service that benefits not only libraries and scholars but also publishers of all types, commercial and not-for-profit, multi-title and single-title. It is part of having a systemwide perspective, something that has been a central component of our approach from JSTOR's first days.


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