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This article is an interim report on a project commis-sioned by the worldÕs major subscription agents: thedevelopment of a suite of model licenses of electroniccontent to libraries. The use of primary journals inelectronic form is a relatively recent event; both pub-lishers and librarians are feeling their way. New busi-ness models may emerge, and model licenses willhave to provide language that reßects new develop-ments as they emerge.

The driving force behind generic licenses is a rec-ognition of the need for a predictable environment inwhich model language can be found and used to ex-press the outcome of most negotiations, whatever thatoutcome might be. The variety of licenses that bothpublishers and vendors offer contain much that iscommon in substance but different in expression.As a result, legal counsel is required to review eachlicenseÑa time-consuming and expensive process. Ifacceptable wording can be found to express the manyvariables that can emerge from negotiation, then theprocess can be shortened and speeded up.

With this in mind, Þve subscription agents com-missioned John Cox Associates to develop a set ofmodels, or Òprecedents.Ó This article describes the

Cox

is Principal, John Cox Associates, The Pippins, 6Lees Close, Whittlebury, Towcester, Northants NN12 8XF,United Kingdom; e-mail: John.E.Cox@btinternet.com.

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context in which they evolved, the process that wasadopted, and ongoing development.

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We are all part of the knowledge-based economy. It ex-tends well beyond the scholarly community to includethe media, publishing, software, database, education,and Þnancial communities. While telecommunica-tions has encouraged rapid change throughout thetwentieth century and has facilitated a transformationin the ways people communicate and conduct busi-ness, it is the Internet that has had a truly revolutionaryimpact on all of us.

The scholarly community is but a small part of theonline industry. Led by the United States, it has qua-drupled in size in ten years. In 1998, the business andÞnancial communities bought 70 percent of online in-formation, but the biggest growth was in mass-marketconsumer transactions:

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¥ 25 percent of households in the United States andGermany have PCs, 22 percent in the United King-dom, and 12 percent in Japan.

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¥ World Wide Web usage is expected to grow fromsixty-nine million in 1997 to 320 million in 2002.Today, the United States has 56 percent of WWWusers; this percentage will fall to 42 percent by2002 as Western Europe and others catch up.

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It is important to recognize that the scholarly com-munity is unlikely to be a major inßuence on changesin copyright, competition, or commercial law in theface of powerful interests in the entertainment and in-formation industries. The inference to be drawn fromthese very general statistics is that the action is far re-moved from the speciÞc needs of the academy. Copy-right law in particular will reßect the world at largeand will, in any event, be driven by international trea-ties negotiated at the World Intellectual Property Or-ganization (WIPO).

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The academic community itself is beset by changesÑsome economic, some cultural, and some technologi-cal. Many of these changes go back to the optimisticdays of the 1960s.

¥ Abundant resources both for research itself andfor collecting the resulting abundant literaturematched the rapid expansion of university educa-tion in the 1960s and 1970s. Today there are twiceas many scientists conducting research as therewere in 1975. Twice as many papers are publishedper year than twenty years ago.

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The money to sup-port libraries, however, started to dry up in the1970s; library budgets have increased by only 40percent over the same period.

¥ Higher education itself is being forced to respondto studentsÕ expectations as more adults seek qual-iÞcations, and the demand for lifelong or continu-ing education and off-campus studies increases.Universities have adopted many of the techniquesof modern business in the quest to attract and retainstudents and to obtain research grants. The contem-plative culture of traditional academic life has beenreplaced by the challenges and pressures of thecompetitive marketplace where the consumer isking.

More recently, the Internet has transformed thespeed, universality, and volume of communication.Scholarly communication has been suddenly revolu-tionized. Until recently it has been conducted by tele-phone, letter, and conferenceÑitself enabled by theadvent of air transportÑand its results appeared inbooks and journals. Today, the Net is the dominantmeans of informal communication between scholarsin the Òinvisible collegeÓ and is about to transformformal scholarly communication that the printed jour-nal and monograph have dominated until now.

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When scholarly literature was published in print, allthat was needed was to bring the work to market andrely on the protection of copyright law. The high-speed photocopier made it necessary to develop li-censing systems to legitimize photocopying in univer-sities, government agencies, and the private sector,and to establish the Copyright Clearance Center andother reproduction rights organizations around theworld. But the paradigm did not shift fundamentally.

The digital information environment is unlike anywe have ever known. Most national copyright laws donot provide effective protection for electronic publica-tions. The little case law that exists provides no guid-ance on the applicability of fair use and the inter-

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library loan privileges libraries have enjoyed in theprint environment. The range of uses which digitalworks make possibleÑand the ease with which theycan be usedÑsuggest that librarians now have a tool tomeet the needs that print simply cannot satisfy:

¥ Customers demand more access rights for distancelearners, alumni, and others working with the uni-versity, and better and more speciÞc standards ofaccessibility.

¥ Budgets in many academic institutions now inhibitcoherent collection management, other than on acooperative, multi-institutional basis.

¥ Purchasing consortia are negotiating licenses fortheir members that require ÒbulkÓ prices, perfor-mance standards, and archiving requirements.

¥ The print medium does not meet the needs of manydisciplines any more, simply by virtue of increasedspecialization and complexity.

¥ The sheer volume of information in traditional formshas outstripped human ability to assimilate it.

¥ Technology now gives us the means to deal withsuch volume and complexity.

While the digital environment meets many of theseneeds, the protection of intellectual property providedby copyright law is incomplete and uncertain. More-over, it does not deal with standards of accessibilityand service that purchasers are entitled to expect.Nor does it deÞne the boundaries dividing proper useby faculty and students from unacceptable misuse.Copyright is essentially a default mechanism that isappliedÑoften in unpredictable waysÑto situationsthat can be better deÞned and agreed in a contracttailored to the needs of the parties.

It is no secret that basic copyright law is riddledwith ambiguity. Ambiguity leads to conßict. If conßictleads to litigation, the legal costs are formidable. In theUnited States, a straightforward copyright case cancost as much as US $250,000; a complex one will costmuch more. The outcome of such litigation can bequite unpredictable. No one gains from so much un-certainty about basic ground rules.

A more deliberate system that sets out what the pur-chaser can do with a work and what the supplier has toprovide is needed. The law of contract provides the so-lution. Licenses, which are in fact contracts, conferpredictability and clarity and remove the uncertaintiesinherent in the interpretation and application of copy-right law.

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In a licensing environment both publishers and li-brarians have to deÞne their needs and establish theirpolicies. Publishers were Þrst out of the gate. Theyhave met this need with a profusion of licenses thatdeÞne what

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think are the usage rights needed bythe individual institution or the members of the con-sortium. The result has been that both publishersand librarians face the daunting task of negotiatingterms, preparing and reviewing agreements, and en-suring compliance with legal and university policyrequirements for each individual license transaction.The administrative burden this entails is wholly dis-proportionate to the variety and complexity of thetransactions.

Publishers, librarians, and subscription agents des-perately need a rationalization of this process and theharmonization of the many versions of similar provi-sionsÑthe so-called Òboilerplate clausesÓÑused to im-plement license transactions. But the development of apredictable licensing environment requires better mu-tual understanding of publishersÕ and librariansÕ respec-tive requirements and concerns. It also requires cooper-ation between all members of the scholarly community.

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Neither publishers nor vendors, as suppliers of goodsand services, can discuss prices or other terms to-gether; these are matters on which they should com-pete. Under US anti-trust and European competitionlaws, they can engage in developing

pre-competitive

standards and protocols, including standard Òboiler-plateÓ provisions such as warranties and applicablelaw, that will enable publishers, librarians, and inter-mediaries to operate ßexible, market-driven arrange-ments efÞciently. So can their trade associations.

The UK Publishers Association (PA) and the JointInformation Systems Committee of the Higher Edu-cation Funding Councils (JISC) set up a working partyof publishers and librarians to develop a model licensethat they could recommend for use in the United King-dom. The Publishers/JISC license was developed overtwo years of meetings and twenty drafts; it was put inthe public domain in 1999. It is the Þrst model to bedeveloped and endorsed by both producers and cus-tomers in the UK serials community. More recently,the STM Association of ScientiÞc Technical and Med-

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ical Publishers, an international trade body, and thePharma Documentation Ring, an informal associationof librarians from twenty-eight multi-national phar-maceutical companies, have been engaged in nego-tiating a model license for the pharmaceutical industry.

Developments in the United States have taken a dif-ferent form, often that of Òmegaphone diplomacy.ÓLibrarians have been vocalÑand skillfulÑin puttingforward their case. The

Principles for Licensing Elec-tronic Resources

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Statements of Current Per-spectives and Preferred Practices for the Selectionand Purchase of Electronic Information

from the In-ternational Coalition of Library Consortia (ICOLC)have succinctly set out the marketÕs requirements. TheLIBLICENSE Web site is a treasure trove of advice,examples, and shared experience. The US publishers,constrained by anti-trust law, have not managed to en-gage in the constructive dialogue achieved, for in-stance, in the United Kingdom.

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Traditionally, subscription agents have provided ser-vices that rationalize and simplify journal subscriptionordering and renewal between some 20,000 publishersand a not-much-smaller number of libraries world-wide. They provide bibliographic and managementservices to libraries. They are a proven distributionchannel for all those who publish for the library mar-ket. It is logical that they should seek an analogousrole in the digital environment: that is, to help librariesto procure the electronic journals that they select andthe rights that they require to enable them to meet theirindividual institutional needs and to relieve publishersof the burden that only the very largest can resourceproperly. They are in a unique position to apply theirtransaction-processing and negotiating skills to the ac-quisition process.

Many of the larger serials publishers have devotedconsiderable energy and resources to selling Òpack-agesÓ of their journals direct to individual universitiesand to library consortia, effectively bypassing the ven-dor. SpringerÕs LINK, Wiley InterScience, AcademicPressÕs IDEAL, Kluwer Online, and ElsevierÕs Science-Direct are all offerings of the complete journal listfrom the publisher. For consortia like OhioLINK,VIVA, Galileo, or NC LIVEÑeach of which has mem-ber libraries in research universities, four- and two-

year colleges, state and public libraries, and even schoollibrariesÑthese licenses represent a notable broaden-ing of access to databases of research literature thatthose outside the research sector would not normallypurchase in print. Moreover, the publishers have ben-eÞted by incremental increases in revenue in return.

Direct sales and licensing, however, only works forlarge publishers and for large customers: multi-sitecorporate libraries, large universities, or consortia.Such an approach does not work for the majority ofpublishers whose output is too small to justify thetime and effort involved in negotiating licenses, eventhough such publishersÕ titles may include high-impact journals that are part of any core collection inthe Þeld. Neither does it account for the speciÞc needsof individual libraries; libraries do not select journalsby publisher or in bulk lots.

The vendorsÕ response to the challenges of bulk pur-chasing and consortia has been measured. The compila-tion of publishersÕ licenses on a Web site (RoweComÕsLicense Depot, for example) was the Þrst manifesta-tion. Undoubtedly the collation of a variety of licensesin one place is a signiÞcant convenience for librarians,but it does not remove the burden of negotiation fromlibraries.

However, both the appointment of Swets as Man-aging Agent for the National Site Licensing Initiative(NESLI), the UKÕs national purchasing consortium,and the appointment of EBSCO to procure licensesfor the California State University SystemÕs JournalAccess Core Collection (JACC), indicate that vendorsare now prepared to assume a negotiating role onbehalf of consortia. It is clear that vendors will take amore active role in the negotiating process, even to theextent of being authorized to complete agreements onbehalf of their customers. The majority of publishers,who publish fewer than ten titles, can only beneÞt.

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As a result of pre-competitive discussion, a furtherstage in the harmonization and rationalization of thelicensing process has now been reached. A new Website (www.licensingmodels.com) contains a suite ofgeneric standard licenses for electronic journals anddetailed guidance on their use as toolsÑboth duringnegotiation and afterwardÑto record the agreementreached. These model licenses have been sponsoredby, and developed in close cooperation with, Þve majorsubscription agents: Blackwell, RoweCom, EBSCO,

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Harrassowitz, and Swets. There are four model li-censes for four categories of licensee: the single aca-demic institution; the academic consortium; the publiclibrary; and the corporate, government, or other spe-cial library. They do not re-invent what has alreadybeen developed, but rather enhance existing work andare international in applicability. Moreover, they havebeen developed in close consultation with publishersand librarians from many different countries. Their de-velopment was undertaken by John Cox Associates,an international publishing consultancy specializingin licensing and content management.

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Developing licenses is an iterative and evolutionaryprocess. In this case, the UKÕs Publishers/JISC modellicense was the starting point; it was a vital source offormat, concepts, and model provisions. The

PLER

statement, ICOLCÕs

Statements of Current Perspec-tives

and the LIBLICENSE Web site were importantsources of ideas. Policy statements from librarygroups in Germany and The Netherlands and a widerange of existing licenses from publishers, CD-ROMvendors, and database providers already in the publicarena provided ideas and an international perspective.

Each of the four license models follows a standardformat, based on the Publishers/JISC model. It startswith deÞnitions and sets out what institutions can andcannot do with the licensed material. It contains op-tions and choices, with the result that there is a formof words for most situations. It is designed to providewords to cover most outcomes from negotiations, es-pecially on those issues that are contentious betweenpublishers who are concerned about security of materialin an online environmentÑsimply to protect their on-going businessesÑand librarians who quite naturallywant the widest possible range of rights to provide theservice to customers that they feel is professional andappropriate. It does notÑand cannot, because of anti-trust and competition lawÑrecommend solutions, butit provides alternative wording to select when agree-ment is reached.

Although each of the four licenses is similar in for-mat, it was decided that there were sufÞcient differ-ences among individual university libraries, consortia,corporate and special libraries, and public libraries towarrant separate treatment.

After initial drafts were prepared, they were sub-mitted to a process of widespread consultation withpublishers and academic and special librarians. Consul-

tation was often informal and individual. A consultativeseminar was held at the American Library AssociationÕsAnnual Conference in June 1999, with representativesof the Þve sponsoring vendors and invited publishersand librarians. After a number of redrafts, the model li-censes were published in August 1999.

Effective license models demand ongoing develop-ment. Revisions were announced in September 1999,and at the time of this writing, another consultativeseminar was scheduled to convene at ALA Midwinterin January 2000.

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These licenses are in the public domain. Each followsthe same format, which is based on the Publishers/JISClicense. Much of the language is common to eachÑthere is a Þnite number of ways of expressing standardÒboilerplateÓ provisions! They are intended to helppublishers, subscription agents, and libraries to createagreements that express what they have negotiated.

They have already been adopted by three publishersÑLippincott Williams & Wilkins, MCB University Press,and Portland PressÑas the basis for their standard li-censes. Both Purdue University and the Chesapeake In-formation & Research Library Alliance (CIRLA) areusing them to develop standard licenses for procuringelectronic journal content. Many others are selectingwording for use in their own standard agreements. Inshort, these models are, as expected, being treated as aresource or tool in many different ways. Nevertheless,the greatest beneÞt to the community will be secured ifthey are used extensively as a model to create predict-able licenses.

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The issues that often prove contentious include theinclusion of Òwalk-inÓ users (including alumni) andremote users; archiving; usage data; local storage inthe electronic reserve; use in course packs; availabilitybefore print; and use of electronic Þles for supplyingcopies to other libraries, i.e., interlibrary loan. Twoexamples illustrate the approach:

¥ Supplying copies to other libraries. There is uncer-tainty about the application of current copyrightlaw on fair use and interlibrary loan privileges toelectronic Þles. To avoid confusion or argument onthis issue, the licenses have adopted a neutral word-

8 SERIALS REVIEW Ð JOHN COX Ð

ing: supply of copies to other libraries. They pro-vide three options in relation to such supply: theuse of the licensed electronic journals is not al-lowed; it is permitted in both paper and electronicform; and it is permitted from electronic Þles pro-vided that the article is printed out and then sent tothe receiving library on paper (this is a positionadopted by a number of major STM publishers). Itis not the role of the license to recommend whichone to adopt; it merely provides the words to usefor the solution that is agreed upon.

¥ Course packs. The licenses provide two alternatives:permitting the use of the electronic Þles as a sourcefor course pack material, and prohibiting such usewithout further permission of the publisher.

The provision of such options and alternatives is afeature of all four licenses. The intention is that what-ever the parties agree to, they will Þnd a set of wordsin a recognizable format to incorporate in a formal li-cense. The licenses are tools to minimize the legalcomplexity so that publishers, libraries, and agentscan concentrate on the real business issues.

NEW BUSINESS MODELS MUST BE REFLECTED IN MODEL LICENSES

These licenses cannot stand still. Much research andexperimentation is needed in structuring informationand designing formats for easy location, retrieval, andviewing on screen. Every publisher needs to be in-volved with every librarian in the development of stan-dards such as the DOI, in creating better metadata, andin the economic and cultural issue of archiving. Thiswill inevitably affect the business models and pricingschemes used by publishers. Just as consortium li-censing has changed the reliance on the individualjournal subscription, it is likely that new and differentforms of doing business will emerge:

¥ Pre-payment for access at the article level, asElsevier has been testing with the University ofMichigan in its PEAK project

¥ Package pricing by discipline or subdiscipline; thismay be single publisher offerings, or aggregationsof multi-publisher materials

¥ Transactional, or pay-by-the-drink, models similarto document delivery

¥ The database, or Pay-TV, model, where the sub-

scription provides access to a core collection oftitles, including back volumes, for a set periodÑusually a yearÑat the end of which access is deniedunless the subscription is renewed. This is similar toa cable-TV subscription, which secures access to agroup of TV channels for the subscription period.Access can only be maintained if the subscriptionis renewed. While this is unlikely to attract academiclibraries concerned about continuing access andarchival rights, it may be appropriate where researchpriorities change, for instance, in industrial research,or where the price is favorable.

¥ Micro pricing, in which a payment will becomedue every time an item of information is accessed.The item might be a diagram, table, or paragraph;access might be downloading, printing, or simplyviewing for more than a set period of time, but theunit price per access will be low.

New ways of doing business require a predictable, nota standardized, licensing environment. Standardizationis, of course, the enemy of innovation. No publisherwants to lose the competitive advantage of devisinginnovative terms of use or an attractive new price struc-ture. No librarian could contemplate being deprived ofthe advantage of accepting them. As more online prod-ucts and services become available, and as publishersbegin to offer librarians a variety of different pricingschemes for their online literature, an effective licensingmodel has to be maintained to accommodate changes.The sponsoring agents are committed to doing so.

LICENSES ARE TOOLS OF THE TRADE

Licenses should not be seen as a matter of competitiveadvantage, but rather as tools to be used to help bothpublishers and librarians. The preparation of these li-censes would not have been possible without the Þvesubscription agentsÕ recognition of this. While a num-ber of major publishers have initiated direct negotia-tions with libraries, including consortia, there is clearlya hunger in all parts of the serials community to sim-plify the process.

The development of model licenses is in the interestsof the whole serials community. Licenses are but asmall part of the development of the formal electroniccommunication of scholarship and research, but theywill reduce the time and effort of negotiation and helpthe development of a settled and predictable licensing

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environment. This will only be possible if they evolveas technology and business approaches change. Andthat depends on feedback from usersÑpublishers or li-brarians. The future of this process is in your hands.

NOTES

1. DTI/Spectrum, Moving into the Electronic Age: AnInternational Benchmarking Study (London, 1998).

2. Ibid.

3. International Data Corporation, Internet: The GlobalMarket Forecast for Internet Usage and Commerce (Lon-don, 1998).

4. Carol Tenopir and Donald W. King, ÒTrends in Scien-tiÞc Scholarly Journal Publishing in the United States,ÓJournal of Scholarly Publishing 28 (July 1997): 135Ð70.

5. See http://www.uksg.org/pa.htm; http://www.library.yale.edu/consortia; and http://www.library.yale.edu/~llicense.