There are three things keeping the academic publishers profitable.
1. Ownership of high prestige journals with high impact factors. Publication in these journals matters for review, and helps your Hirsch Index
2. Sponsorship of learned societies. The publisher provides the infrastructure for the editors and authors, and the members get a copy…
3. Promotion. The Publishers bundle the journal to sell to academic libraries and individuals. This expands the readership, say of say, the East African medical Journal or the Australian and New Zealand Journal of (insert specailty) beyond that region.

But the model is breaking down. Via slashdot, Harvard has released a memo saying that the cost of journals is now non sustainable. Harvard. Which is not poor. From the memo:

The Faculty Advisory Council to the Library, representing university faculty in all schools and in consultation with the Harvard Library leadership, reached this conclusion: major periodical subscriptions, especially to electronic journals published by historically key providers, cannot be sustained: continuing these subscriptions on their current footing is financially untenable. Doing so would seriously erode collection efforts in many other areas, already compromised.

It is untenable for contracts with at least two major providers to continue on the basis identical with past agreements. Costs are now prohibitive. Moreover, some providers bundle many journals as one subscription, with major, high-use journals bundled in with journals consulted far less frequently. Since the Library now must change its subscriptions and since faculty and graduate students are chief users, please consider the following options open to faculty and students (F) and the Library (L), state other options you think viable, and communicate your views:

1. Make sure that all of your own papers are accessible by submitting them to DASH in accordance with the faculty-initiated open-access policies (F).

2. Consider submitting articles to open-access journals, or to ones that have reasonable, sustainable subscription costs; move prestige to open access (F).

3. If on the editorial board of a journal involved, determine if it can be published as open access material, or independently from publishers that practice pricing described above. If not, consider resigning (F).

4. Contact professional organizations to raise these issues (F).

5. Encourage professional associations to take control of scholarly literature in their field or shift the management of their e-journals to library-friendly organizations (F).

6. Encourage colleagues to consider and to discuss these or other options (F).

7. Sign contracts that unbundle subscriptions and concentrate on higher-use journals (L).

8. Move journals to a sustainable pay per use system, (L).

9. Insist on subscription contracts in which the terms can be made public (L).

The memo refers to DASH, which is the Harvard online repository of papers, There are other ones, such as PLOS and arXiv.org, but these have not made a difference. I usually do not quote Monboit of the Guardian, but on this issue he is correct…

What we see here is pure rentier capitalism: monopolising a public resource then charging exorbitant fees to use it. Another term for it is economic parasitism. To obtain the knowledge for which we have already paid, we must surrender our feu to the lairds of learning.

It’s bad enough for academics, it’s worse for the laity. I refer readers to peer-reviewed papers, on the principle that claims should be followed to their sources. The readers tell me that they can’t afford to judge for themselves whether or not I have represented the research fairly. Independent researchers who try to inform themselves about important scientific issues have to fork out thousands. This is a tax on education, a stifling of the public mind. It appears to contravene the universal declaration of human rights, which says that “everyone has the right freely to … share in scientific advancement and its benefits”.
Open-access publishing, despite its promise, and some excellent resources such as the Public Library of Science and the physics database arxiv.org, has failed to displace the monopolists. In 1998 the Economist, surveying the opportunities offered by electronic publishing, predicted that “the days of 40% profit margins may soon be as dead as Robert Maxwell”. But in 2010 Elsevier’s operating profit margins were the same (36%) as they were in 1998.

The reason is that the big publishers have rounded up the journals with the highest academic impact factors, in which publication is essential for researchers trying to secure grants and advance their careers. You can start reading open-access journals, but you can’t stop reading the closed ones.

As long as we measure productivity and quality by citations, we will not be able to cut the cord. The current way forward is to demand that papers are open access as a consequence of funding. But that approach, or the boycott, will not work as well as simple economics. The publishers are pricing themselves off the market. And if your library cannot afford that closed journal, you will stop reading it.