Headquartered in London, Exact Editions was founded in the first wave of digital magazine apps that appeared circa 2005. The company was an early pioneer in its goal to deliver digital magazines exactly as they appeared in print, but not as PDF files which were the default setting at the time.
The company also took the view that digital magazines should include all available back issues as part of a searchable archive, allowing publishers to monetise their back catalogue, which in many cases spanned decades. Exact Editions’ tech platform soon came to the attention of various institutions and libraries, not least because back issues are often used in academic research. Fast forward to 2018 and Exact Editions is now a world leader in archiving digital publications for both publishers and institutions.
WNIP caught up with Exact Editions’ Ellie Burnage and the company’s Co-Founder, Adam Hodgkin, to gain deeper insights into their technology and to discover how magazine publishers can monetise their digital archives.
What business problem is your company addressing?
The digital institutional market for consumer and professional periodicals and magazines has been surprisingly neglected. As it happens, many consumer magazines are quite widely stocked by university libraries; but they are not widely used in their paper versions. We solve that problem for the library and the campus by providing a clean and simple digital site-license solution.
For the magazine publisher we solve a distribution problem that cannot be tackled by a publisher working on its own – libraries will expect support, software and cataloguing data that needs market expertise. Institutions expect a level of service and integration that only a platform solution like ours can deliver.
What is your core product addressing this problem?
One of the key features of our solution is that each magazine retains its own identity and is sold on its own account at a price that is determined in consultation with the publisher. Pricing is per magazine and per institution and this is another key point. The University of Vienna (with over 100,000 registered users) will be prepared to, and is expected to, pay more for its subscription than a small art college or music school.
Furthermore, a high profile magazine that is published weekly will be priced higher than a poetry magazine that comes out twice a year. We use a matrix with 9 pricing levels for magazines, and four ‘sizes’ of institution. This matrix sets prices that can be as low as $150 per year up to $5,000 per year.
How does your platform work?
Digital libraries require, or at least prefer, that their resources are licensed for the whole institution. We handle this by recognising all of the IP addresses on their network. This guarantees that all users on the campus have unlimited access for the term of the subscription. The Exact Editions platform is an ‘access’ or ‘streaming’ solution, which means that the resource is only available and usable for the term of the subscription. We also enable ‘off-campus’ access by the standard protocols that libraries use for this. Finally, we ensure that subscriptions can be easily renewed, and this is key for the publishers because the rate of renewals is so high.
What are other people doing in the space and why?
Very few of the platforms that sell digital magazines offer any kind of license deal to libraries, although Zinio has been in this space with a slightly different licensing approach (per seat, or per simultaneous user) for public libraries in North America. Some of the biggest library suppliers offer very large bundles of magazine archives – but these solutions tend not to offer current or recent issues to the licensee.
This is a global market opportunity and 75% of our institutional sales are ex-UK, with roughly 50% by value coming from North America.
For the publisher, the main cost is a commission for which Exact Editions will manage all delivery, sales, support and maintenance issues as well as the promotion and marketing of the resource to the libraries. Our standard commission is 40% (i.e. 60% to the publisher). The publisher will also pay an annual account fee of $250 per magazine as well as extra charges for a large archive contributing to our databasing costs and scanning costs, if necessary. These are one-off development charges and depend on the size of the archive.
How do you view the future?
We think the future for digital institutional sales of magazines (professional and consumer) is much larger than most magazine professionals realise. Few magazine publishers recognise that their magazine might command an annual subscription of $2,000 or $3,000 from a single institution. Catching a share of this market is a unique opportunity for any magazine.
Some of the magazines we host are now earning more than half their digital revenues from institutional licensing.
Any magazine that has £20,000/$30,000 or more of digital subscription sales to individuals will have a reasonable potential market in institutions. Any magazine publisher who wants to assess the potential for digital licensing to institutions should review their print distribution list – if more than 100 copies are going to university or library addresses, then the magazine has potential.
The second test would be to enter the title of the magazine in the Worldcat database and review how many libraries have holdings of the magazine in print. If this totals over 100, then this is at the very least interesting; if over 500, then a good opportunity awaits. As an example, the New Statesman appears in over 1600 libraries in the WorldCat database.
Thank you, we look forward to catching up in due course.