ACES Database Negotiation: Group Case Study Tip for analyzing this case: Don't worry about using a calculator for complex calculations. Any calculations needed for this case are provided. You are Jane, an electronic resources librarian at a doctoral-granting institution, and you have received a renewal proposal for a term of 1 year, that is a 10% increase over the prior year's price for the ACES database. See Exhibit 1 for details on the offer. Exhibit 1. Initial Renewal Offer - E-mail from the sales representative who supports ACES database. Hello Jane, The price for renewing the ACES Database for 2020 is $22,000. This is an incredible value based on usage during the last year, where downloaded content if acquired individually is valued over $100,000 in the private sector. Content Area* B C D E Total Annual Use Individual Price/Use Total Value 812 $ 20 $ 16,240 505 S 75 $ 37,875 964 $ 60 S 57,840 27 2,315 S 45 $ 1,215 S 113,170 In addition, as you know we were recently acquired by Delta Information Resources. As a result, we have a new license agreement. I have attached this agreement for your perusal. Please let me know what time works for you to discuss ACES, how people are using it, and your renewal. I look forward to the discussion. Best, Donna *Note Content Area A is openly available government collected data and presents no additional value so it is not reported by the vendor. The double-digit increase automatically triggers a deeper review by a larger collections group within your library to determine whether the resource should be renewed. This group will review the offered deal to determine if the library should provide a counteroffer. If a counteroffer is made, the group needs to decide what is acceptable. The collections group has also developed a new set of guidelines for ideal license terms, which includes allowing for walk-in users and strikes out non-disclosure agreements, based on the premise that you are a public institution that is funded by taxpayer dollars. Allowing walk- in users will ensure access for public constituents, and the removal of any non-disclosure agreements ensure transparency in how library funds are spent. The larger collections group has also been directed by library administration to find a way to cut $100,000 from the resource budget this year due to flat budgets combined with high subscription inflation rate (6%). You gather the following information based on a conversation with the subject liaison supporting public health and nursing to prepare for your meeting to discuss the offer with the larger collections group. Background: ACES is a database heavily used by practitioners in public health and in a variety of other healthcare fields. The primary purchasers for this database typically are healthcare providers and government agencies. The academic market is a secondary market that purchases the database in order to help students learn to use the tools and resources commonly used in the field. There are three competitive products that provide similar content with some overlap: Beta, Gamma, and Epsilon. All four databases offer access to government data on health-related topics (Content Area A). Exhibits 2 & 3 summarize additional information you gather. Exhibit 2: Content Overlaps & Unique Attributes Data Source Overlapping Content Area A B C DE Government (Open) X Unique Attributes F G None ACES Beta Gamma Epsilon X X X X X X X X X X X X X Proprietary analysis, learning tools Proprietary analysis Proprietary analysis None Exhibit 3: Access, User experience (Difficulty), Target user, Cost Data Data Source ACES Access Difficulty Level Off-Campus Somewhat Unlimited seats difficult Target User Professional practitioner 2019 Annual Cost $20,000 (Proposed Designed for accessibility Beta In-library use only Very difficult Professional at 2 dedicated practitioner computers** Not designed to renewal price $22,000) $14,000, 2 more terminals can be added for $10,000 support accessibility Gamma Off-Campus Easy Academic students $5,000 Unlimited seats Designed for accessibility Epsilon Off-Campus Somewhat difficult Limited to 10 Professional practitioner $15,000 You can increase seats seats to 25 for $5,000 more. Some features are designed for accessibility **Library is not accessible 24 hours and your university supports online degree programs as well. Analysis of the new license agreement for Delta Information Resources (publisher of ACES database) Issues of concern: Under the termination clause in the contract, you notice that the new agreement now incorporates language that requires subscribers of the database to destroy all downloaded proprietary data upon termination of the subscription. If this is true, it would be impossible to manage, as the library cannot control where users store the database information, nor can it control the destruction of data on users' personal devices. If this license term is required, i.e. ACES will not strike that language, the University will not sign off on the agreement. A non-disclosure agreement clause is present. It is unclear in the contract whether walk-in users to the library can use this resource, and this point needs clarification and correction. Price & Usage History: Pricing has been stable for the last 5 years with no increases, so the 5-year compound annual growth rate is 1.6%. The subject liaison also reminds you that the interface for ACES was updated about 10 months ago. Immediately after the update, there were several technical issues that caused the database to be unstable, though it seems like most of the technical glitches have been worked out. Before this, the interface hadn't been updated in 8 years and appeared rather dated. Students previously found the interface confusing to use, and as a result usage had been declining overtime. Since the launch of the new interface, however, usage has increased dramatically. This resource, the three competitive resources, and the government data website are also listed in the library's subject guides and course guides. ACES is emphasized as an important database in capstone courses (senior-level) for the public health and nursing undergraduate programs, whereas the database from Gamma, which has a smaller learning curve, is emphasized more in freshman classes. Exhibit 4 summarizes price and use history. Exhibit 4. Price & Usage History Year Price Use $/Use 2014 2015 2016 2017 2018 2019 $18,500 $20,000 $20,000 $20,000 $20,000 $20,000 2,435 2,501 2,250 $7.60 $8.00 $8.89 1,815 $11.02 1,395 2,315 $14.34 $8.64 You present this information to the collections group and it is decided that, if possible, it would be good to maintain access to this database. Next, the group needs to develop a negotiation strategy that includes analyzing each parties' interests (the libraries and the vendors). These interests include: Determine priorities Identify alternatives Determine the BATNA (best alternative to negotiated agreement) Create the initial offer Define the ZOPA (zone of possible agreement) Pinpoint concessions