FTE and its effect on database subscription
Nor Edzan Che Nasir
Library
University of Malaya
ABSTRACT
 The digital era has brought about enormous changes to the
journal publishing process. Publishers are now offering
journals as digital copies packaged as a database. This move
has also affected the journal subscription process and
publishers are now offering journals as database packages.
Publishers now have to look at various journal subscription
models in order to offer the so-called “best price” to their
clients. Various factors are taken into account when
deciding on the pricing of individual journals or packaged
journals. One important factor in this instance is the fulltime equivalent or FTE. Pricing now takes into account the
FTE of potential subscribers.
 This paper attempts to explore the various definitions of
FTE and its implications, if any, on database subscription.
INTRODUCTION
 Emergence of electronic journals – changes the journal
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subscription practice in libraries – academic libraries
Researchers prefer online databases for their activities
Academic libraries migrate from print to electronic
journals – decline in demand for print
Electronic journals are now bundled as online
databases
Expensive – search engines
Problem – pricing model
RE: FTE-based pricing
To: liblicense-l@lists.yale.edu, <liblicense-l@lists.yale.edu>
Subject: RE: FTE-based pricing
From: "Tracy L. Thompson" <tracy.thompson@yale.edu>
Date: Fri, 13 Oct 2006 16:41:00 EDT
Reply-to: liblicense-l@lists.yale.edu
Sender: owner-liblicense-l@lists.yale.edu
I would really like to find a forum for a back-to-basics discussion about pricing models for e-resources
and the justifications for or arguments against them. I entered the discussion in the mid-90s after the
basic terms had already been established. I don't know what the original arguments were. How did we
even get to usage-based pricing? What industry built that model and how did we buy into it for
information? Does it still hold up? What about the inherent value of the content independent of usage?
And what about pricing models based upon "maintaining print spend?" How does that make sense for
the consumer? And what should we be advocating as the 'best' model for all involved, not just
library/consumers and not just vendor/publishers.
I feel like it's time to revisit all of these models and at least reassure ourselves that they still hold water. If
anyone else would be interested in a dialogue, or has some background or insight they'd like to share,
please respond to me directly and I'll see if there is enough interest to plan a webinar or something.
Cheers,
Tracy
At 02:46 PM 10/12/2006,
Stefanie Wittenbach wrote:
I personally believe that FTE-based pricing is quite harmful to the library
community for the following reasons: Use is not necessarily tied to the
institution's FTE. Growing campuses are penalized because the price
continues to increase, but the users of the resource may not be growing in
the same way. If anything, I think database pricing should be a flat rate or
flat rate plus some factor for high use.
Stefanie Stefanie Wittenbach Assistant Dean, Collections John Peace
Library The University of Texas at San Antonio San Antonio, TX 782490671
stefanie.wittenbach@utsa.edu
[mailto:owner-liblicense-l@lists.yale.edu] On Behalf Of Porzio, Steve
Sent: Tuesday, October 10, 2006 6:31 PM
To: liblicense-l@lists.yale.edu
Subject: FTE-based pricing
The American Statistical Association (ASA) is considering a change from its current flatrate charge for web access to its journals to a tiered, FTE-based pricing structure. I am
seeking librarians familiar with various journal pricing structures who would be willing to
answer a few questions and give me their general thoughts on this potential change. We
strongly wish to avoid harming relations with our library patrons and would much prefer to
collaborate with those who purchase our journals. If you are willing to provide input, please
contact me at steve@amstat.org.
The ASA is, among many other things, a non-profit publisher of statistical journals. More
info may be found at www.amstat.org/publications.
***************************
Stephen Porzio
Associate Executive Director and
Director of Operations
American Statistical Association
Alexandria, Virginia 22314-1943
www.amstat.org
PRICING MODELS
 Subscription is to an individual or to an institution
 Databases in academic libraries are heavily used
 Therefore, there is a tolerance for differential pricing
based on institution size and intensity of use
 Various pricing models available
PRICING MODELS
 Print-only or online-only = either format available independently either
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at the same price or at different prices
Print-and-online = both format bundled for one price
Print-plus-online = online available for a surcharge on top of the printonly price
Online-plus-print = print available for a surcharge on top of the printonly price
Pay-per-hit
Pay-per-view (PpV)
Pay-per-download
Pay-per-print
Deeply discounted pricing
FTE based pricing – most costly
Transaction-based pricing - cheaper but difficult to anticipate usage &
library has to constantly monitor & even restrict usage
A combination of these
PRICING MODELS
 Most used is the banded or tier-based pricing
 Dependent on
 Type of institution
 Number of full-time equivalent students (FTE) at an
institution
 Number of sites included in the license
 Number of concurrent users able to access the service
 Or some combination of these measures
FULL-TIME EQUIVALENT
 FTE
 Measures the size of an organisation & is not an
indicator of actual usage
 For a university = number of full-time students (or
equivalent) plus total number of faculty and teaching
staff across all subject areas and all types of students
across the sites that will have online access
 Most popularly used now but is expensive for older
universities with large numbers
 Vendors have discounted – 10-20% on FTE & 10-20%
on subscription
FULL-TIME EQUIVALENT
 Good for highly used titles
 Bad for specialised titles
 Anticipated and not actual use
 Low usage – disadvantage
 Low usage – still pay by FTE-based
EXAMPLE OF TIERING BY FTE
 Tier 1 = 1 – 5,000 FTE
 Tier 2 = 5,001 - 10,000 FTE
 Tier 3 = 10,001 - 20,000 FTE
 Tier 4 = 20,001 + FTE
RECOMMENDATIONS
 Tiered subscription model = FTE based pricing for
general interest high use titles BUT
 FTE should be based on usage and not absolute FTE
 FTE for current year based on usage in previous year
 Concurrent user pricing model = specialised
databases with limited use
 Single site licensing = one city = a university having
different campuses in one city
 Multiple site licensing = a university having different
campuses in different cities
 From single site & restrict IP address to that site only =
single licence with site FTE only
RECOMMENDATIONS
 Usage-based pricing model that allows a library to convert
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from PpV to subscription model once it reaches a specified
usage threshold
Subscription to core titles only in the database, others PpV
Price locked for a stipulated time
Price increase must be reflected in quality of services
rendered, change in interface of website, improved access
to database
Consortium pricing – negotiate aggressively
Look for open access journals on the Web & provide links
on your website & alert users of their availability
CONCLUSION
 No universally acceptable pricing and licensing model.
 Suppliers need to talk about this to libraries
 Suppliers need to be aware of financial status of
libraries & need to develop a more “friendly” pricing
model.
 MOLEC – need to look at this and develop a favourable
model applicable to Malaysian libraries
REFERENCES
 Bist, R.S. (2005). Managing and Handling Electronic Journals : Some
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Issues. Retrieved from:
http://shodhganga.inflibnet.ac.in/dxml/handle/1944/1410
Crow, R. (2010). Subscription Options and Pricing. Retrieved from the
Connexions Web site: http://cnx.org/content/m34287/1.1/
Goudar, I.R.N. & Narayana, P. (2004). Emerging pricing models for
Ejournals Consortia and Indian Initaitives. Retrieved from: .http://nalir.nal.res.in/3984/1/ICDL-Consort-pricing.pdf
Mikkonen, F. (2006) Analyzing E=book Pricing Options and Models
Based on FinE Lib E-book Strategy. Retrieved from:
http://archive.ifla.org/IV/ifla72/papers/154-Mikkonen-en.pdf
Sreekumar, M.J. & Sunitha, T. (2005). Library Capacity Building
Through E-journal Consortia : the Indian Senario. Retrieved from:
dspace.iimk.ac.in/bitstream/2259/249/1/09-mgs-sunithapaper+new.pdf ·
Thompson, T. L. (2006). RE: FTE-based Pricing. Retrieved from:
http://www.library.yale.edu/~llicense/ListArchives/0610/msg00071.ht
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