Saturday, May 31, 2008
I commented in this blog recently about one startup, Flat World Knowledge. The founders of that company were nice enough to come to Albany to meet with me, and I have to say, I came away impressed. The more I came to understand the company and their aims, the more it helped some of my thinking about what open access and the future of stores and textbook content could be. They are a company I hope to keep in contact with going forward and I am looking forward to their product releases over the next year.
Recently I have had the opportunity to see two other start-ups that are also interesting in their own way. The first is Polar Mobile. They have an interesting technology for taking publisher content and moving it onto mobile devices. They plan to focus on the higher education market and I see some real promise in their technology. I am not convinced that mobile technology is the solution for all kinds of content, but there is certainly some types of content we could (and perhaps should) be delivering via this format. Since a story months ago about how Starbucks and Apple are working together for downloading music through the stores, I have been interested in how we might use similar technologies. Having seen their product demonstrated, this could be a company to work with and explore further some possibilities. It would be very interesting to see them connect with the right partners.
Another company I have met with a couple times now is Intellidemia, which was founded by some RPI alums. Intellidemia hopes to address some of the shortcomings they see in the traditional course management systems by starting from a fresh angle... the syllabus, and a desire for ease of use. They are also heavily focused on integrating calendars that cross boundaries in educational institutions, so that students, faculty, and institutions can manage time and calendars more effectively. Administrative concerns like accreditation activities and other analytics are high on the watch list. With the current players in the course management system market Intellidemia will have a tough row to till... however, they do have some interesting ideas about the technology design. I am curious to watch the company and its development going forward.
Friday, May 30, 2008
The digital landscape is changing rapidly, however, digital book sales are still quite small as a percentage of unit sales and revenue. The industry emphasis when it comes to digital should be on providing choice for students and preserving market share for stores. There is plenty of evidence out there to suggest that now is the time for the industry to position itself within the digital landscape.
In the general book industry we are seeing a continued uptrend in e-book sales. At the recent D6 conference, Amazon announced that for the 125,000 titles sold on the Kindle, 6% of the unit sales for those titles were sold in digital rather than print. According to figures tracked by the International Digital Publishing Forum (IDPF), digital e-book sales for March, 2008 were up over 58% compared to the prior year. The IDPF figures are based on only trade e-book sales via wholesale channels for 12-15 trade publishers. The organization estimates that actual e-book sales could be as much as double their figures. The graphic below, provided by IDPF, shows the trend over the past five years.
For textbook adoption we are also seeing several data points that signify an uptick in e-book purchases. While 18 months ago the big concern was iChapters and direct to student sales, e-book sales were still very low, typically below 1% of units and revenue. This semester we saw multiple examples of e-textbook sales over that 1% threshold—examples that begin to move beyond the anecdotal. In one pilot involving six classes at one institution, average adoption was 10% of enrollment and anywhere from 3% to 45% of total units sold (any format) in a class. In another set of pilots at two institutions project coordinators were able to get over 90% of students enrolled in the course to select the digital textbook option. Recently, one institution found that when they offered first year students a digital option among pre-ordering choices prior to the start of the semester, 20% of those students selected the e-book when it was available. Another institution reported similar numbers with over 10% of students enrolled in courses selecting digital where available. Other anecdotal examples with adoptions over 30% of unit sales are becoming increasingly common. In a few studies we have seen that roughly 18% of students prefer digital textbooks to print textbooks, with another 7-8% of students expressing no preference. In the most recent StudentWatch study sponsored by the NACS Foundation roughly 18% of students bought or accessed digital course materials this year. These figures show a trend in adoption that is likely to continue growing over the next few years as incoming students become increasingly technically sophisticated and comfortable.
Interestingly, when students were asked where they acquired their digital course materials, 33% indicated the library, 30% the college store, 25% the campus course management system (e.g., Blackboard, WebCT, Angel, Moodle, etc.), and 10% indicated other direct sales sites (e.g., direct from publisher, Freeload Press, etc.). This number should be disconcerting to college stores as it suggests erosion in market share when it comes to digital course materials. Stores are not thought of as the first source for digital textbooks. Indeed, this is perhaps not surprising when only 46% of the Large Stores Group members report offering a digital option to students, and a comparable percentage of college stores in general report being unable to handle an online transaction. These figures and trends, coupled with many other industry developments make it imperative for the industry and NACS to find a solution that ensures the college store’s place in digital textbooks.
Stores that wait another 3 to 5 years before entering this market may find it too late to recover lost market share or declining profits from course materials. Indeed, in Ohio there is a mandate under review that would require all colleges and universities in the state of Ohio to reduce textbook costs to students by 50% within the next 1 to 2 years. Digital is expected to play a key role in the solutions that are adopted. IDC estimates that the e-learning materials market will continue to grow by roughly 25% or more in the U.S. for each of the next two years. The inability of the industry to credibly support the sale and distribution of digital textbooks is a contributing factor to the pursuit of other channels (such as direct institutional licensing) by publishers. It is also contributing to other new players entering the market, which may soon include companies like Apple and Microsoft. In a sense, by not pursuing digital options, stores are creating their own competition and encouraging both students and publishers to find other ways to exchange products and services.
Perhaps I have painted too glum a picture or been overly assertive in my position here for the college stores reading this blog, but perhaps tough love is sometimes a necessity. Consider it another of my ongoing wake-up calls. At NACS we are working on several initiatives to be unveiled later this summer that will address the concerns about market share and the trade infrastructure among college stores. Our aim is to provide an easy and affordable way for stores to become more actively involved in digital content sales and distribution. We have a number of pilots either in progress or in the design phase. We are still looking for partners in that process -- both on the content and interface sides of the equation. The signs appear to be getting clearer all of the time. If you are a college store reading this blog, what are some interesting or innovative ideas you have tried lately in the digital area? Please share.
Sunday, May 25, 2008
Saturday, May 24, 2008
Friday, May 23, 2008
Thursday, May 22, 2008
There was a piece on tracking the origins of digital content in Information Week recently. Tim-Berners-Lee won one of several grants, and his work will focus on developing a mechanism to determine the origins of a piece of content. I saw some other presentations not long ago focused on how to remove the anonymity from the web. Being able to authenticate who is contributing or generating content (or who is using it) is important from a remuneration perspective. I seem to recall some other projects working on this problem too -- ACAP maybe, with their interest in being able to track who is using the content produced by publishers, such as photos from People Magazine? Maybe this is more of the direction of future DRM -- remove anonymity and it becomes easier to track, but at what cost to society? Some of the comments to the article (particularly the first couple) are worth thinking about.
Tuesday, May 20, 2008
Publishers and technology developers sounded the same note over and over again, pointing out that the Internet has given them unprecedented access to consumer feedback, and that the way to grow the e-book market is to listen to what readers are saying.
While all the speakers seemed to agree that the book business has a long way to go before readers are as familiar and comfortable with digital books as they are with paper books, it was also clear that publishers see rapid growth in the digital book market and that the format is becoming an increasingly important part of their business.
"You have to get out there and experiment" noted Malle Vallik, director of Digital Content and Interactivity at Harlequin, and arguably one of the most innovative players in digital content and publishing. I have seen Malle present a few times now and always walk away with a new idea and wondering why "more publishers and stores don't do things that way." I hope to incorporate some of the ideas I have learned from her in one of the new big initiatives we have planned for this year at NACS.
To the point though -- there seems to be growing agreement that digital's time is coming. This means stores (and publishers) alike must begin, continue, and expand our experimentation with digital AND listen to our customers.
Monday, May 19, 2008
In a non-surprising, but notable news release last week, CourseSmart announced Ingram Digital Ventures (IDV) will provide the platform for delivering their e-textbook collection. For anyone not familiar with educational publishing these days, CourseSmart is a company founded by six of the largest higher education textbook publishers (now five, since Cengage bought Hougton Mifflin). IDV is a division within Ingram, and provides a range of services -- VitalSource and Lightning Source being among perhaps the more common IDV companies familiar to college stores.
The partnership adds to the scalability of the e-textbook solution CourseSmart will be able to provide to the market. One interesting aspect of this arrangement is that IDV will "provide a customized e-book reader application to enrich CourseSmart eTextbooks with interactive functionalities." Given that another IDV company, VitalSource, is in the same business, it is a curious, or at least interesting, development. It will be interesting to see how similar or different the two e-reader environments are at the end of the day. The end result should provide benefit to consumers.
It's Monday, so pop a bag of popcorn and prepare to enjoy about 5-10 minutes of spoof videos.
Sunday, May 18, 2008
- Most publishers support authors right to digital download royalties, but most have no mechanism to manage the payment of those royalties.
- Nearly 4/5ths of publishers believed they should be allowed to sell directly to consumers, and 56% said they already are!
- 89% said they believe there is still very much a place for bookstores.
- 83% believe consumers will fully accept e-book readers.
- Academic titles were considered to be among the most likely areas where e-books will be used
This survey has shown that publishers are very much moving towards the modern
digital world. [...] However, there are still plenty that do not have any
systems in place at all for online sales and these publishers need to rapidly
re-think their strategy if they are to succeed in the modern high-tech future of
the publishing industry.
The same could be said for many booksellers. An interesting article though with some equally interesting findings. I think it would be interesting to see the full set of data they collected .... something worth tracking down.
Saturday, May 17, 2008
A couple quotes from the article that I found particularly interesting:
- On the topic of online sales, Rebuck said that publishers' opportunities to sell direct to consumers via their own websites were intrinsically limited.
- "Consumers are not interested in publishing company brands; people buy books because of the author or topic, not because it is published by Random House, but because it is written by John Grisham or Jacqueline Wilson. Only aggregating sites such as Amazon or Waterstones.com can offer the range a serious book buyer is looking for."
These are interesting comments for us in the college store industry and offer some insight into the strategic direction we are headed in this space. More on that in the months to come...
The full text of Rebuck's talk is also available for reading. I think it is a well-crafted address, with a nice storyline and several interesting points. I found the discussion of the stages of digitization, along with her discussions of how technology is and will radically change publishing and bookselling, while still leaving some of the core elements particularly interesting. It is worth the read if you have the time.
Wednesday, May 14, 2008
First, experimentation. Experimentation keeps us moving forward, allows us to figure out what works and what does not work, helps us identify new opportunities, and helps mitigate future costs. Organizations that are risk adverse can start with small experiments. The point is to try something new. Experimentation is an important process in helping organizations adapt to change.
Second, share our knowledge. By sharing our knowledge we can better leverage the risks embedded in our experiments. We can learn from each other and instead of repeating each other's errors, we can create new ones.
Third, partner. Again, in periods of rapid technological or environmental change, the survivors are most likely to be those who develop effective networks of strategic partnerships. By partnering with others we can identify collaborative opportunities to experiment, further reducing the cost and risk involved with experimentation.
Fourth, measure. As Rich McDaniels says, Measure what Matters. It is critical that we establish goals and measure our progress toward those goals. What good is an experiment if we do not know the effect. I used to do a lot of performance management work when I was in management consulting, and have taught classes on the topic as a faculty member. The skinny is that measurement helps us determine what worked and what did not work -- enabling us to get a much greater ROI for money and time spent in experimentation.
The panelists at the BISG panel appear to represent all four of these ideas. Experimentation is something I have been pushing at stores since arriving in this position 3 years ago this week. For example, all stores should be experimenting with selling digital textbooks at this point. Even if sales are currently low, they will not always remain so. Try marketing the content in a different way, or delivering it in a different way. Did that affect sales? Waiting to even try digital will reduce sales in the future as others establish market share and mind share in what is the traditional domain of publishers and the college store. There are lots of opportunities out there for those who look, partner, and are willing to experiment.
Monday, May 12, 2008
Strategic thinking and planning takes time, and college stores should be taking some time every day to think strategically. I have heard a few interesting stories lately from different stores and some of the things they are doing. UCLA's bookstore recently created a "Course Materials Strategist" position to think more about what is ahead. I think that is an excellent move. I have helped a few other college stores rethink the job description for their textbook manager as well. We have lots of opportunities out there, but if we are not doing the environmental scanning and strategic thinking about the implications, then the odds that we will be the ones to capitalize on those opportunities is fairly slim. Just something to think about on a Monday.
Just a cool emerging technology to think about on a Monday afternoon.
Wednesday, May 7, 2008
Some other new readers are expected on the market later this year. I think I am content to wait and upgrade mine once the next round of innovative devices hits the market. Although, I may have to break down and ask for a Kindle later this year. I like my Sony Reader now that I have gotten use to it, but the wireless aspect of the Kindle is attractive. If I bought a Kindle I would want to be able to share books across the two devices so that my wife could use one and we could trade books as we often do when we finish reading them.
There have been a couple news stories lately about online testing and study aids for students. Two in particular seem to be getting some attention: ACETheExam.com and Flat World Knowledge.
ACETheExam was announced in a press release earlier this week. It is a new initiative by Houghton Mifflin Harcourt to offer students practice exams in four popular courseareas: Intro Psych, US History, Principles of Economics and General Chemistry. In brief, the tool allows students to buy self-scoring practice exams made up of 15-20 questions that cover key topics in the course, drawn from a typical textbook. When I taught as a faculty member, this is the type of content students used to get for "free" as part of the "add-ons" that came with textbooks. It may be a publisher strategy though to reduce the cost of traditional textbooks and make more money off of the ancilliaries, since many states and students are pushing for a separation of the add-ons from the traditional texts.
Given the current state of technology, I expected this tool do more than just self-score quizzes at 5-6 cents per question. The SAT exam prep tools by ETS might be a good model to look at. If you get an answer wrong, it may ask you more questions, and then take you to lessons to explain the concepts. Such an approach allows for more self-directed learning. Perhaps I am a bit idealistic, but in the end, shouldn't it be about learning and not just the test? Perhaps when several people pushed me the link on this new development I was expecting a bit more.
Flat World Knowledge
Flat World Knowledge (FWK) is another group that has been getting a lot of press lately. Thanks, perhaps in large part, to the press stories coming out of the Student PIRGS lately that focus on open source textbooks. I have received a good number of e-mails on stories about FWK, and several requests for my opinion. The marketing certainly has been interesting, with the cute stick-figure videos. The real product does not come out to 2009, however. I have not seen the actual product yet, and screenshots are not enough to quel my ingrained faculty cynicism, so it is difficult to assess the real quality.
That said, I do have to admit that I like some of the basic elements of the business model -- faculty pick the content, students pick the format. This is an idea I have pushed for a while now. We are working on some initiatives to do the same. The faculty are a barrier though. Some of the student data I have seen suggests that students are afraid (for lack of a better word) to buy textbooks in a format other than what the faculty member is using. This is changing, and faculty are becoming more sensitive to textbook prices (and their role in causing textbook prices to increase). Faculty really have to be won over though. Solving that puzzle is critical.
It is interesting that they plan to give the digital away for free, but then charge if students want other formats. Their site explains:
We then turn around and sell things of value to that large market – more
convenient ways to consume our free book (print, audio, PDF) and efficient ways
to study (study aids). Sure, we’ll make less money per student than the big
guys. But that’s okay. We’ll be selling to a lot more of them, and we’ll be
doing it for a lot less money (thanks to technology like web-hosted services,
XML, print-on-demand, and more). Like we said… just a smarter way to do
business. For all of us.
So here is the dilemma. Most students do not currently like digital versions of textbooks. While there appear to be no statistical difference in student outcomes when they use the digital versus the print, students do report greater eye fatigue with current delivery options. This gets coupled with the digital divide problem -- students who can make best use of the digital option are typically the more economically well-positioned, because they have better access to computing technology, higher quality displays, and are more likely to have had more exposure and experience with technology -- allowing them to be more comfortable with the digital option. Thus, students who need the lower cost option most, the socio-economically disadvantaged, are likely to have to rely on the traditional media more. So the dilemma is that poorer students still have to pay more to get content in the format that best matches their needs, experience, and access to technology.
That said, there is no perfect solution to this problem out there. We are working to solve this problem too, and our solution will also have its problems. As the Japanese saying goes, "nothing is so good that it cannot be improved." While it means competition for us, in my opinion FWK is a good step forward for the course materials industry as it will help further test out models where the content and the format are separated. FWK, like AceTheExam, will charge for access to study guides (and likely other ancilliaries), further emphasizing the split among pieces of content. It will also test out some new business models to reduce costs that could work to the whole industry's advantage -- such as print-on-demand.
While it means competition for us, FWK's business model also represents opportunity. By separating the content and the format, I also see opportunities for FWK to work with college stores. Our paired strengths may create a greater win-win for students and institutions than separate initiatives. There are advantages for a company like FWK to work with college stores -- and for college stores to work with FWK. Both sides have some unique advantages. Anyone from FWK reading this note who might want to have a discussion?
Saturday, May 3, 2008
Gettysburg College recently used the Kindle in the classroom. As part of that experiment, they conducted an end-of-the-semester focus group with the students from the class. One of the student observations was that they had a hard time searching the digital content to find particular passages or information they were looking for. One of the focus group observers asked the students why they did not use the search button at the bottom of the device. The students essentially asked, "Search button? Where's that?" The students reported that they did not use the buttons so much and were more inclined to use the menus. This was apparently different from how adults their parents age used the device -- relying more on buttons than menus.
Just an interesting observation. Make of it what you will. As we look at digital course materials though, we should keep in mind who is using it and that their expectations are likely to be quite different from ours.
At Kodak, Some Old Things Are New Again -- an interesting story on digital's role today at Kodak, the company that created the digital camera, and then essentially shelved the concept to avoid hurting their traditional core of film sales. (Sound like there is a lesson in there for some other traditional industries???) While just a fraction of who they used to be in the past, today Kodak is producing a number of new innovations. How they are transforming the company, and some of the technologies they have in their pocket are truly fascinating. The story is an interesting lesson on organizational re-evaluation and change.
Amazon Sues Over State Law on Collection of Sales Tax. This is an interesting and important case to watch from the digital course materials perspective. As course materials move digital, there have already been questions as to whether sales tax is collected or not. A number of states use sales tax to fund education. However, if in-state businesses must collect state sales tax, while out-of-state businessses do not, in-state economies and businesses are put at risk. While this article does tackle the course materials topic directly, it is a case to watch as it could set some precedence for future cases that are likely to arise that hit closer to home.
Informal Style of Electronic Messages Is Showing Up in Schoolwork, Study Finds -- We have all seen the jokes about the "new language" that has emerged in the texting generation. Now it is finding its way into homework. I have met kids who know how to keyboard (or type as we used to call it) but never really learned how to write in cursive. An interesting piece on how the next generation to enter the college classroom is different from the past. Different is not necessarily bad, but it will increase pressure to find ways to communicate across the culture gap.
There are many more stories of interest as well, but the above sampling might give you an idea of what I am talking about. NYT also started a Tech Talk podcast about a month ago (I think, based on the archives). That also provides an interesting summary of some of the news stories from the week. Easy to download to my ipod and listen to on the plane.
The NBC executive behind the initiative said the initiative is based on the premise that "video will replace the textbook." An interesting concept. It is worth noting that in another piece
from last summer Cisco identified two trends in K-12 they saw as significant for education. One of those was the dramatic increase in the use of digitally downloadable video for use in the classroom.
The concept of video as the textbook may be taking things a bit far, but perhaps not too far. The future will likely be more interactive media -- or true multi-media. Video will certainly be a significant part of that. It also brings another new set of players into the course materials content market. This perspective is echoed again in the first article where the author reports: NBC tried to find a way to work on the project with textbook publishers but couldn't find common ground, he says, adding that textbook publishers have held a virtual monopoly over educational materials. Change is certainly in the air.
We are seeing many new content producers and content aggregators entering the field of educational materials -- and digital delivery is lowering the barriers to entry. An explosion of content providers will not necessarily make things easier or better for faculty and students. What we need is a way to aggregate the aggregators in an effective way, that allows for rating and evaluating the quality of the content being contributed, and which enables easier content discovery. That is the role college stores and campus libraries have played in the past. How might we work together to fill that role again in the future?