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    Market Forces: Demand and Supply

    Digital information in a networked environment results in lower costs of reproduction and distribution for producers and intermediaries and lower opportunity costs for users. The lower costs contribute to an increase in the supply of information. Lower costs also result in more producers providing more methods of access to more information.

    Lower costs mean new information products are produced. New publishers including universities, libraries, faculty and students find that they can produce web-based journals using low cost desktop publishing tools. This has led to an explosion in the supply of new electronic journals.

    Paradoxically, this explosion has raised some costs while lowering others. Although the costs of many new electronic journals are relatively lower than those of print journals, for libraries this ever-increasing supply of digital information can dramatically increase the total costs. As the number of subscriptions purchased rises so will the staff costs involved in cataloging these journals, both elements impacting library budgets. Patrons find that the opportunity cost of accessing any given source of information has declined, while the overwhelming increase in the number of information products results in more time being spent on digital information than was spent consuming print products. The digitization of an information product previously made available only in print or microfiche can lower the cost per unit of production, the cost per unit for subscription by libraries, and the cost of access to the information by patrons, while at the same time dramatically increasing the supply of information products. This increase in the number of information products results in substantially higher total costs of production, subscription and access to information.