LONDON (ShareCast) - (Sharecast News) - Shares in RELX took a hit after the University of California cancelled its subscriptions with the company's Elsevier academic journals arm.
"Despite months of contract negotiations, Elsevier was unwilling to meet UC's key goal: securing universal open access to UC research while containing the rapidly escalating costs associated with for-profit journals," the university said.

The UC system, which accounts for nearly 10% of all US research published, wanted research from UC authors under any deal to be made available for free, while Elsevier demanded that authors would pay a fee for their research to be distributed on an Open Access basis.

"This is big news," said analyst Ian Whittaker at Liberum, adding "the fact this has happened when Elsevier is having disputes with other universities will raise questions".

He said the two questions are how much this impacts RELX's numbers, with recent full year results showing Elsevier maintaining its 2% organic revenue growth, with academic journals stronger.

Elsevier said it had around 12,000 contracts worldwide, of which disputed contracts were only 5-6 of these.

"However, not all contracts are the same and the UC contract would have been one of their biggest," said Whittaker. "Nevertheless, our overall conclusion is this will not change the numbers that much (although it may impact the ability of Elsevier's organic revenue growth to accelerate from 2% to 3%)."

But the second question was the degree to which this encourages other universities to take a similar line.

"That would presumably be the issue for Elsevier as UC's very open move could encourage others to follow suit," Whittaker said.

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE