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Textbooks, Kindle, the Apple Tablet, PDF & RIA’s

In 1994, I was hired as a consultant to Harcourt Brace College Publishers in Texas, due to my background in interactive videodisc, authoring tools and multimedia and their high degree of need to stem the downward trend of falling college textbook sales.

They were searching for ways to add value to new textbooks in order to incent faculty to specify the latest version and create a disincentive in the used book market. I was instrumental in assisting them to create an interactive CD-ROM (and saved them several hundred thousand dollars in development costs over what they thought needed to be invested!) so that the disc could be affixed to the back of the book and contain so much additional material that faculty and students would be hardpressed to ignore the newest book.

Didn’t really work, though the practice of bundling has become widespread in the college publishing marketplace. Book sale increases at Harcourt were modest at best, and the CEO and head of New Media both left within a couple of years after that (to the now defunct UOL Publishing, an online university concept). I’ve not kept appraised of this space, but my daughter buying textbooks for this coming Fall has brought this issue to the forefront once again.

Bear with me for a moment as I connect some dots surrounding the textbook space, Amazon’s Kindle, the rumored Apple Tablet, the shifts in Adobe’s Portable Document Format (PDF) and the category known as rich, internet applications, and how I am certain we’re very, very close to the tipping point for textbooks being delivered electronically.

TEXTBOOKS
In their report, College Publishing Market Forecast 2007-2008, the college publishing industry alone is estimated at $34 billion. IMHO, they’re in a position akin to the record industry before the iPod/iTunes rescued some of their revenues.

Publishers are taking steps to protect their market. The Association of American Publishers has examined the textbook arena many times. According to “Inside Higher Education”, some college textbook publishers do, in fact, offer many of their textbooks electronically (McGraw-Hill Education, for example, offers almost 95 percent of its textbooks as e-books, and the publisher has seen a steady growth in interest over the past several years, albeit from a small base).

Various initiatives like Cafescribe — a social networking/textbook delivery joint venture between six top college textbook publishers — and CourseSmart LLC are gaining traction…

…but the groundswell of angst, anger and screams by students, parents and now legislators of “ripoff!” are putting extreme pressure on college textbook publishers.

A few pieces of evidence of the trouble in the college publishing market:

  • The National Association for College Admission Counseling pointed this out in their report on textbook pricing (PDF):

“In June 2006, Congressman Howard P. McKeon (R-CA) and Congressman David Wu (D-OR) asked the federal Advisory Committee on Student Financial Assistance (ACSFA) to conduct a study on the cost of college textbooks.

According to Congressman Wu, “The cost of higher education is increasing and the buying power of financial aid is decreasing. For our knowledge-based economy, these trends pose a serious problem. The rising cost of college textbooks is part of that problem. I have received more communication in my office on this problem than any other education topic. The college textbook industry is a classic broken market. And every year that the cost of textbooks doubles compared to the overall average of prices, is another year students experience an even greater barrier to a college degree. I intend to find solutions to this problem that is plaguing our students.

  • According to this article in Diverse: Issues in Higher Education, the Federal government is addressing this problem as well: College Textbook Prices Focus of Congressional Advisory Committee Hearing: GAO report finds book prices have tripled over past 20 years.
  • Even the news media is jumping on the bandwagon as evidenced by this recent report:

WHAT NEEDS TO BE DONE?
It’s not just about the tools and technologies to build and deliver a replacement for highly expensive paper books. It’s all about aligning incentives, but here’s the kicker: I don’t think the solution is going to come from government, advocacy groups, those buying the books, open source/open content initiatives like Wikibooks, or even the backpack police concerned about kids and college students schlepping huge and heavy materials around, but rather from a vendor or vendors who deliver a platform, provide tools, and a device that will capture the imagination of everyone concerned. 

In May of 2007, a Congressional report was released by a bipartisan committee headed by Congressman David Wu (D-OR) and House Committee on Education and the Workforce Chairman Howard P. McKeon (R-CA). This committee, the Advisory Committee on Student Financial Assistance
was asked to conduct a one-year study of the cost of college textbooks and its impact on students, and to make recommendations on ways to make textbooks more affordable.

The report, “Turn the Page: Making College Textbooks More Affordable” was released (PDF) in May of last year which made the case for a “National Digital Marketplace” and a way to align incentives that, IMHO, hasn’t a chance for success.

TECHNOLOGIES
In my view, here are the items driving us toward a tipping point in the college textbook (and probably K-12) marketplace:

  • The obvious and widespread market dissatisfaction amongst students, faculty and parents
  • A deep desire for college publishers to discover new ways to deliver their content that scales, maintains or increases their gross margins, and protects the investments they have to make in creating this content
  • Amazon ships the Kindle with purchasing, auto-delivered ebooks/publications/blogs, wireless connectivity for purchasing and much more…and it goes far beyond any previous e-reader device
  • Apple’s incredibly successful iPhone — with extremely simple to use touch screen technology and now 3G access — is leading the way with rumors of a Tablet and that iTunes trademark now includes the word “books”. Apple’s ability to deliver a device consumers want and is easy to use — along with the extremely intuitive and delightful touch screen technologies in its human interface — will undoubtedly leap the ereading category forward quickly if they do deliver just such a tablet
  • Adobe’s creation of a Portable Document Format (see about PDF, which is now an open standard) has recently grown to include the capability of embedding Flash videos inside a PDF as well as combining any digital file (or combination of files) inside what’s dubbed a “PDF Portfolio”, means that they’ve delivered a richer, more robust platform that could easily and dramatically extend a flat, 2D textbook
  • The rich, internet application (RIA or sometimes called “hybrid” apps) space is one in its infancy but holding great promise (see my posts on this RIA category here) :
    • Adobe AIR is a ‘container’ that delivers an application with many abilities like auto-updating, video, audio, and programmatic functionality
    • Microsoft Silverlightis a cross-browser, cross-platform, and cross-device plug-in for delivering the next generation of media experiences and rich interactive applications for the Web.
    • Mozilla Prism is an open source offering targeted at hybrid applications that work as both desktop and “cloud computing” delivery mechanisms. and, frankly, they really state the case for RIA’s well: “Personal computing is currently in a state of transition. While traditionally users have interacted mostly with desktop applications, more and more of them are using web applications.”
    • Apple’s iPhone App Store is giving us a glimpse in to how application functionality may be delivered going forward and how apps might be purchased for that rumored Apple tablet.
      • Apple’s Safari browser is also based on the open source WebKit, but more revealing is the session at their June Worldwide Developers Conference with their session entitled “Building Native Look-and-Feel Web Applications Using SproutCore.”  Though little has been intimated publicly on what Apple might do in the RIA space, it’s clear that they’re driving forward in this area.

Think for a moment about the opportunity represented by a combination of a development platform with tools, a way to combine content that delivers most of it on a device but has connection to the internet and application functionality in “the cloud”. There could be tremendous upside potential in an ongoing stream of content updates, connections with other students (like CafeScribe does with its social networking component), and the textbook would become a living, breathing and dynamic offering vs. something the college publishing industry manipulates in order to maintain revenues and gross margin.

 

About Steve Borsch

I'm CEO of Marketing Directions, Inc., a trend forecasting, consulting and publishing firm in Minnesota. Prior to that I was Vice President, Strategic Alliances at Lawson Software in St. Paul where I was responsible for all partnerships at this major vendor of enterprise resource planning software products and services. Read more about me here unless you're already weary of me telling you how incredible and awesome I am.

Comments

  1. PXLated says:

    Good post.

  2. Great post. I’m excited to see where all this is going. Hardware, like the Kindle, OLPC XO and other affordable laptops are going to make an impact on publishing, especially textbooks.

    Imagine is a low income district could invest in district subscription to a text book each year rather than purchasing textbooks.

    I’m assuming that costs will plummet. They should. The only cost will be writing and layout. The cost for a website to download is minimal compared to printing and binding a book.

    The grad school class that I co-teach doesn’t even use a text book. We simply link to articles, chapters and other resources on the internet. The students appreciate not having to purchase a book but I think their learning goes much deeper because of the internet access.

    It truly is an interesting time!

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