Tag Archives: profits

Elsevier reverses direction, becomes nonprofit

The Chairman of Reed-Elsevier, Jan Hommen, sent out a press release today announcing a completely new direction for the corporation. As of Monday, July 20, 2009, Reed-Elsevier will buy back all of the stock from their current shareholders, and they will become a private not-for-profit Open Access publisher.  This change in corporate direction will effect Elsevier, LexisNexis, and Reed Business Information.  Reed Exhibitions will be sold off.

In fact, the corporation will be giving back ALL of the profits they had garnered over the last 23 years.  How was 23 years arrived at?  He explained that the ARL started their in-depth analysis of the rise of journal prices in 1986, so 23 years seemed to be a good number.

Starting January 1, 2010, thousands of libraries and thousands of individuals will be given a large windfall from the Billions of dollars (with 7% compounded interest) Reed-Elsevier had made off the backs of libraries and other subscribers.  One very large midwestern public university plans to give $32,451,488.07 back to citizens of the state.  A medium sized east coast private university plans to reduce tuition by 21.7% starting with the Fall 2010 enrollment.  A small liberal arts college library will complete their expansion in 2011, and they plan to name the new wing after either Elsevier or Mr. Hommen.  The student body will take a vote later this summer.

Jane Michaelson, a librarian from one of the institutions noted above, said “Well thank God, it is about time they came to their senses.  During this hard economic time, this is very welcome news, indeed.  Now, I will look forward to meeting with their reps at the next library conference.”

To explain this complete reversal, the Chairman explained that he recently finished reading two books, the Starfish and the Spider: the Unstoppable Power of Leaderless Organizations and Here Comes Everybody: the Power of Organizing Without Organizations.  He realized that the company was just too big and centralized. He then compared the journal publishing industry to the music industry that currently has just five big companies.  As we all know, the music industry is in disarray, and he did not want Reed-Elsevier to go through the same shakeup and turmoil.

As of August 1, 2009, many of their websites will be changed to .org’s. In fact, some of these may currently work — reed-elsevier.org, elsevier.org, sciencedirect.org.  He also stated, “I Can’t believe how self-centered we had become; we now want to promote scholarship and scientific research instead of focusing on profits, stock prices, mergers, share holders, etc.  F*ck the share holders.”

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