...and why it isn't working. This is from Exane BNP Paribus on the LibLicence ListServ:
* Noise around boycott against Elsevier offers short term trading opportunity
Reed Elsevier was the worst performing media stock last week. We believe this is due to investor concerns on the back of T. Gowers' petition to boycott publishing and refereeing in Elsevier's journals. We believe the share price reaction was overdone and recommend buying the shares.
* Scientists are boycotting the boycott
Similar petitions in favour of Open Access were organised in 2000 and 2007, with no impact on Elsevier's fundamentals. Our tracking not only shows that this latest petition lags behind the two preceding ones but also suggests that its momentum is slowing. Fewer than 5,000 scientists have signed up, whereas Elsevier works with more than 6m scientists worldwide. The low take-up of this petition is a sign of the scientific community's improving perception of Elsevier.
* Open Access unlikely to hurt financials in the medium term and is priced in
The proportion of Open Access is growing at less than 1% pa. Elsevier's contract lengths are getting longer and the company's growth efforts are focused on new products rather than pricing. Open Access is unlikely to hurt Elsevier in the next five years and the longer term risk is more than priced in, in our view
The killer line in that for me is that Elsevier works with Six Million authors - those "protesting" make up less that 0.1% of that base. And since studies show that 90% of academic researchers are satisfied with their access to the research literature, the whole spat just seems more like an annoyance that something that will lead to journal publishers changing their business models.
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