Why should advisers encourage their students to publish? For the answer, read this post by TR Gregory.
Why is the publishing industry afraid of open access? I can't answer that question, but I can point you to the evidence for their fear: it's right here. Jonathan Eisen points out why PRISM, the anti-open access lobbying group, is total bullshit. The Open Reading Frame doesn't like it either.
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PRISM smacks of hypocrisy, first and foremost for not paying for their homepage images until bloggers across the internet pointed out that they were in infringement:
http://www.itgumbo.com/mumbogumbo/2007/08/hypocrisy_scandals_shock_inte…