Executive Summary

Elsevier recently completed its planned acquisition of Interfolio, the leader in a rapidly emerging category of products known as Faculty Information Systems (FIS). This deal exemplifies many of the worrying trends described in SPARC’s ongoing market analyses over the past four years.¹ In addition to increasing consolidation and presenting new threats to competition, this acquisition highlights the conflicts of interest that can be created when a single entity both publishes and assesses research—and also owns the leading platform through which that assessment takes place.

SPARC will be closely following this acquisition’s overall effects. We recommend that libraries and academic institutions watch for specific negative impacts that may surface in individual interactions with Elsevier and document these where possible. Documenting institutions’ experience may reduce the risk of these negative effects and help encourage regulators to act on any instances of anticompetitive behavior or consumer harm.

Specifically, close attention should be paid to the issues summarized below. If your institution encounters these effects that may be linked to the acquisition, or experiences other effects that may not be listed here, please reach out to SPARC directly by emailing nick@sparcopen.org.

1. Any arrangements that bundle or contractually connect Interfolio with other Elsevier products. These arrangements could take a variety of forms, from bundled packages to discounts on Interfolio based on purchases of another Elsevier product line (or vice versa), to the inclusion of terms about data control in a contract with one part of an institution that supersede terms that have been separately negotiated by another.

Libraries in particular should watch for arrangements that provide discounts on Elsevier tools used by administrators or other campus units (e.g. Interfolio, Pure) that are dependent on the purchase of journal packages, which could substantially increase the lock-in for libraries in these packages (described further in section 3.1).

2. Preferential treatment or integration of Elsevier products within Interfolio. If pursued, Elsevier’s preferential integration of its own products within Interfolio (particularly those related to research assessment) could drive Interfolio institutions to adopt Elseiver products over competitors’ offerings. This would be a significant step toward an Elsevier platform model where institutions could be pushed to adopt an integrated product ecosystem and, as a result, would find it increasingly difficult to select different vendors for different needs (described further in section 2).

3. Significant shifts in pricing for Interfolio or Elsevier research analytics products. Given Elsevier’s strong position in multiple markets, the company may consider providing some products at below-market prices in order to weaken competitors and clear the path for future price increases. For example, if Elsevier were to discount its research analytics products for Interfolio users, such a move could weaken Elsevier’s largest rivals, drive small firms from the market, and discourage the launch of new entrants. Alternatively, if Interfolio provides Elsevier with a sufficient market advantage, the company may move directly to raise prices at a faster rate of increase (described further in section 3.2).

4. Interfolio customers shifting to Elsevier research analytics products over competitors’ offerings, or conversely, current Elsevier research analytics customers adopting Interfolio. In the points above, we describe possible ways Elsevier could leverage strengths in one market to advantage itself in others. Tracking how decisions about using Elsevier products occur in practice will be important in determining how these threats to competition are playing out. If your institution is making this switch, please consider sharing your experience with SPARC.

5. Elsevier marketing products directly to other university units in ways that undermine libraries. We are aware of instances where Elsevier has directly approached university administrators and faculty in ways that undermine the library’s goals during journal subscription negotiations. The Interfolio acquisition will expand Elsevier’s opportunity to strengthen direct relationships with administrators and to engage in behavior that could negatively impact libraries (described further in section 3.1).

6. Post-acquisition changes to Interfolio’s privacy policy and contract language related to privacy. Interfolio represents a rich source of proprietary, often-sensitive data that Elsevier could use to power new research analytics metrics or that its parent company, RELX, might use in other products. Following the acquisition, Interfolio data will exist within the same corporate entity as RELX’s suite of “risk” products—products that have been described as “offer[ing] an oceanic computerized view of a person’s existence” that can provide government entities and law enforcement with “the data it needs to locate people with little if any oversight.”² Changes in Interfolio’s contract language and privacy policy could be an indicator of problematic data uses that may become permissible (described further in section 3.3).

From Publisher to Platform?

The Interfolio acquisition brings the nascent market for Faculty Information Systems (FIS) to the threshold of meeting regulators’ definition of being highly concentrated, as we describe in section 1. The combined strength of Elsevier and Interfolio is likely to push this market past that threshold, and competition in this space should be closely monitored for further deterioration.

Given Elsevier’s reach across the research lifecycle, the acquisition of Interfolio strengthens the company’s ability to transform the process of research itself into an online platform business. The potential negative impacts merit close scrutiny and should raise concerns across the academic community. Specifically, as we describe in sections 2 and 3, this acquisition threatens to further reduce competition and could lead to less consumer choice, higher prices, and decreased product quality across the markets in which Interfolio and Elsevier operate.

In response, there are a variety of actions that academic institutions should consider taking, which we describe in section 4. These range from steps aimed at minimizing negative impacts from the acquisition to documenting and sharing information regarding these impacts when they do occur.

As the pace of market concentration continues to accelerate across the research enterprise, the academic community will be best served by adopting a proactive approach that considers, in advance, the potential for future consolidation and begins to build the case for regulatory intervention before the next merger or acquisition is announced.