NACS Board Greenlights Digital Content Venture

Many of you will have seen (or will soon see) the article in today's Campus Marketplace which announces an exciting new initiative in the digital content space for college stores. This new venture is an important component in implementing the strategic goals for the digital content area approved by the NACS Board earlier this year. Those goals were outlined in a prior post to this blog. Both those goals and this model grow out of ideas and discussions that surfaced in other initiatives, such as the Forum on New Modes of Information Delivery NACS co-hosted with EDUCAUSE and ACRL back in March 2007.

There is still much work to be done and we are very interested in talking with content providers in course materials and digital content, as well as some potential partners on the infrastructure side. In the coming weeks and months I will post more information about the initiative here and answer questions submitted to me where possible. We are still working out many of the technology and content partnerships, but approval by the NACS Board for the conceptual business design and model is a key step forward in providing stores with an easy, affordable, and scalable solution to digital content delivery on campus. We see opportunities for stores whether they be institutional, organizational, independent, private, or contract managed. The platform created by the new venture will ultimately give stores new opportunities to provide products and services to students and faculty, and open doors for new conversations with campus libraries, technology units, and other campus constituents.

This initiative is also being announced by Melanie Sparks, President of the NACS Board, in her opening remarks at Innovate! 2008 which begins today. More on that in this weekend's postings.

Movies as Textbooks...

A store colleage forwarded a couple links that have some interesting content. The first is a link to a posting on another blog -- paleo-future.com. The posting quotes a 2006 book on technology based change that argues most future-predictions of the effects of technology change are overhyped. I have not had the opportunity to read the book (yet), but I did do some searching on the post, the book and several reviews.

The point of the book and the post remind me of another book about "surfing fads in the boardroom." People often chase after what is new and hot and expect that it will change the world. In that sense, I think the author's point is important to observe-- we must be sceptical of new technologies and scrutinize them carefully. The challenge is to not to go in the reverse direction and assume that all technological change is slow paced and that no disruptive technologies will come along to change an industry in short order. The iPod and digital music downloads are an example of the reverse. It is difficult to predict the likelihood that one specific technology will be the dominant design or will be adopted by a population for a new usage. While "tech-hype" is certainly a problem, and people change in response to technology more slowly than technology itself changes, the pace of technology-based change is increasing.

So, how do we tell if a particular technology or form of technology-based change is the one that will change an industry? We look for signs of growing adoption. We look at why similar technologies failed in the past and why they failed to see if the new technology is any different. I believe that the current technologies with e-books for education come close to meeting those standards, although they are not quite there yet. There are still several hurdles to be overcome, but we are making and seeing progress on each of those hurdles. We should be preparing now for whatever format the content or the textbook takes in the future -- which will certainly include some element of digital.

World e-book fair...

There was a recent piece about the World eBook Fair in Information Today. The theme of this year's fair is "Own your own library" and more than 1.2 million e-books will be offered for free download by the participating organizations. The event runs from July 4th through August 4th from 2006 through 2009. This particular article has a number of good links to other online resources for free e-books. For stores that like to provide content to students for free, or are working on initiatives like faculty editions of classics, POD content, or other projects, these links could be useful.

Time to go load up my e-reader before my flight...

Readius Returns

I mentioned the new Readius e-reader about 6 months ago, but an article in the NYTimes over the weekend has an interesting piece on the technology. The innovation of the Readius over other e-readers is use of the new flexible/rollable displays.

The above picture link can be seen more clearly in the original article. The display uses eInk technology, as we see in the Kindle and Sony displays, and will probably cost slightly more than the Kindle. It is expected to be available in the US early in 2009, following earlier releases in the UK, Italy and Germany this fall.

Flexible displays are an interesting and important step forward and could enable a whole range of new products and services -- beyond more rugged and flexible e-readers. The Readius will also use an innovation on active matrix technology, which could ultimately enable both color and an image quality comparable to many LCDs. Apparently the company demo'd a color version a few weeks ago. This seems like a technology to watch.

Online textbook rentals...

Yet another competitor enters the textbook market. It seems hard to keep track these days. This one is another online textook rental company. You can learn more about the company in an posting I came across in another blog this week. The most interesting thing I saw in the blog, was not the main posting, but the final tagline. It said:

In a perfect world, of course, all these textbooks would be available as digital
downloads for you to consume on your preferred reading device. But until that
day, you might as well free up some beer money by renting the textbooks you
don't need to keep.

Hmm... any course content in any format so that students could choose which content and which device. Keep that thought in mind -- there is more news to follow later this week.

Follett and the K-12 Classroom

In a press release from earlier in the week, Follett Digital Resources announced a new content delivery system aimed toward the K-12 environment. The tool uses several "2.0" technologies, enabling better content discovery and sharing. The tool sounds like it has some great features. So... when does the higher education version hit the streets?

Textbook piracy

It has been said before, but it is worth repeating -- customers will eventually get what they want -- legally or illegally. Content piracy is a perfect example. In the P2P (Peer to Peer) space, piracy began with music because consumers wanted only part of an album (such as a song, rather than the whole CD). A while back I posted an article on this blog about Student Bay -- the initiative in Sweden involving content piracy for textbooks.

Just this week, there was an article in the Chronicle of Higher Education on textbook piracy. The article notes that:

One Web site, called Textbook Torrents, promises more than 5,000 textbooks for
download in PDF format, complete with the original textbook layout and
full-color illustrations. [...] Other textbook-download sites are even easier to
use, offering digital books at the click of a mouse.

The Textbook Torrents site encourages students to scan their textbooks into an electronic format and supply them for sharing on the site, much as Student Bay proposed ahead of them. This trend is likely to continue, and get worse, as long as students do not see the value of the textbook as reflected in its cost. As a quote in the article reflects:

"We knew that this would happen, and it has happened very rapidly," he said. "It's not going to go away—it's only going to get worse."

One of the pieces I found disconcerting in the article is one of the possible solutions:

He said that if the problem worsens, publishers may have to take other steps to prevent piracy, such as releasing a new version of most textbooks every semester. The versions could include slight modifications that could be changed easily—such as altering the numbers in math problems. "They may compelled to," he said, "in order to stay one step ahead of the pirates."

New editions even more frequently? That does not sound like a win-win for anybody -- particularly if cost is a driving factor promoting the illegal versions to begin with.

So what is the store's role in addressing this problem? Certainly many of us are aware of illegal versions of course materials on some campuses, posted by faculty or students into campus course management systems. The problem is a complex one -- but one that does affect us. Part of the solution lies in finding a way to allow students to get the content they want (such as just the chapters being used in class) at lower cost (which could mean digital). This is an important discussion in which stores have a stake. What innovative solutions can people think of to help address this challenge?

Thinking like an entrepreneur

There was a great opinion piece/editorial that appeared in Inside Higher Education last week. It is well worth the read. The author (Kevin Guthrie, President of Ithaka) begins with a set of views of how the reproduction and distribution of information in print is being disrupted by the economics of digital media. One of the challenges he describes is the difficulty scholars have in launching and sustaining successful digital initiatives, because they do not think like entrepreneurs. Some could argue the same problem exists for a number of college stores that operate on various college campuses. Guthrie's piece makes some good recommendations and observations of what is required to develop the entrepreneurial mindset that is critical to the success of digital initiatives in higher education -- many of which could be applied to college stores.

The aspects of entrepreneurship he identified as particularly important to creating sustainable digital projects are listed below. I think as one moves through the list, the elements become increasingly relevant and important for stores to consider and internalize in their own terms and context. Here is the list, explanations and insight are added in the full piece.

#1 Grants are for start-up, not sustainability.
#2 Cost recovery is not sufficient: growth is necessary
#3 Value is determined by impact.
#4 Projects should think in terms of building scale through partnerships, collaborations, mergers and even acquisitions.
#5 In a competitive world, strategic planning is imperative. (my personal favorite)
#6 Flexibility, mimbleness, and responsiveness are key.
#7 Dedicated and fully accountable leadership is essential

The full piece is perhaps 1-2 pages in length and is worth the read.

April 2008 ebook sales stats...

eBook sales statistics for April 2008 have been released from the Association of American Publishers (AAP) who collects these statistics in conjunction with the IDPF. Trade eBook sales were $3,400,000 for April 2008, a 19.9% increase over April 2007.

The statistics, historical data and information about the numbers can be viewed at:
http://www.idpf.org/doc_library/industrystats.htm

Please keep in mind the following:

• This data represents United States revenues only
• This data represents only trade eBook sales via wholesale channels.
• Retail numbers may be as much as double the above figures due to industry wholesale discounts.
• This data represents only data submitted from approx. 12 to 15 trade publishers
• This data does not include library, educational or professional electronic sales
• The numbers reflect the wholesale revenues of publishers
• The definition used for reporting electronic book sales is "All books delivered electronically over the Internet OR to hand-held reading devices"
• The IDPF and AAP began collecting data together starting in Q1 2006

Buzz on ebrary study...

I have been seeing a lot of buzz (for and against) a recent study by ebrary on e-book usage by students. A short synopsis can be found in the Chronicle of Higher Education last week. The synopsis is not as interesting as some of the comments to the synopsis. I thought the Chronicle slant was interesting, primarily in its glass half empty slant. I actually thought the fact that 49% of students had used an e-book was a pretty high number, and higher than I had seen anywhere else. However, the Chronicle chose to look at this as over half of students have never used an e-book. Consistent with other studies, over half of the students who do not use e-books say that they do not do so because they do not know where to find them (or something similar).

It is important to note that the ebrary study does seem to have some methodological issues that call into question the real meaning of the findings. As one point in a constellation of other data points, it does point to a general movement towards great adoption of e-books by students, and to some of the persistent barriers to adoption that need to be addressed.

Another blog of interest

It's Friday -- almost time to kick back and relax for the weekend. Or, if you are like me, almost time to catch up on all the work or projects I did not have time for during the week. If you are looking for another blog with some interesting posts, articles, and links related to e-books, then check out TeleRead: Bring the E-Books Home. If you scroll through TeleRead's postings, you will find several items worth reading. I thought the pieces comparing P versus E were interesting -- particularly the entry citing that e-book sales in 2007 beat those for MP3s in 2004.

Of course, when you are done reading TeleRead, please come back to the CITE again!

Have a good weekend, everyone.

Speculation on what is next from Apple...

Following yesterday's theme, we move from speculation on Amazon's sales to speculation on what is next from Apple. MacNewsWorld had an interesting speculation piece on where Apple might go following the iPhone and iTunes. The perspective on how Apple might make decisions to enter markets was interesting. The comment about e-books was interesting:

In this context, Apple might be ripe to reinvent e-book readers, dive into the video game market, or get into car electronics. However, each of these three areas presents obstacles for Apple, Stephen Baker said. E-book readers still seem to be too small a market to pursue. Video gaming already comes with a great experience, and the margins are difficult to control. As for car electronics, the auto manufacturers need very long lead times. They aren't so easy to deal with, and Apple wouldn't be in control. On the other hand, some sort of Mac tablet or mobile Internet device (MID) seems like a real possibility.

The article provides some other interesting speculation as well. If the criteria for entry are control to drive margins, size of the current market, and ability to leverage existing platforms, then e-books could become more ripe as the e-book and e-textbook markets begin to grow and mature. It does seem like e-books are an obvious gap in Apple's current content strategy. Perhaps that will be next on the list after TV?

More speculation on e-book sales...

A number of articles appeared in the past few days on projections of future Amazon e-book sales. I believe most track back to an article on paidcontent.org. The gut of the article is another speculation piece on what Amazon's e-book sales are currently at, and where they may be within 5 years time. In addition to some stats, the article has some links to related articles.

K-12: Pros and Cons of e-Textbooks

An article appeared in the June 9th issue of Education Week's Digital Directions. The article does an interesting review of the benefits and drawbacks of digital textbooks in the k-12 space.

Pulling a couple ideas from the article of relevance to higher ed -- the article provided some "tips" for getting digital textbooks adapted in k-12. However, with a little modification, these could provide good tips for college stores interacting with their campus administrations and faculty as well. Here is a quick attempt at a revision for our audiences:

TIPS
1. Get the administrative green light. Does the administrative leadership and faculty in your institution understand the positive impact virtual textbooks can have on learning?

2. Identify an on-site advocate and expert. You need staff member at each store or elsewhere on campus to keep faculty focused and to train and support them in e-textbook integration.

3. Build a technical-support team. Faculty need classroom hardware and software support so they can focus primarily on creating and teaching academic content, rather than troubleshooting technical problems. College stores should be part of this support team by becoming familiar with the e-textbook options available to students and faculty.

4. Showcase the results of using e-textbooks. Faculty need to see how digital books can help improve instruction at a faster rate than traditional texts.

5. Share ideas and lessons learned. Are other institutions using virtual textbooks? What have they learned? Same is true at the college store level -- some stores are more successful than others at selling e-textbooks. How can we improve our sharing of best practices?

6. Solicit feedback from faculty curriculum experts. They can look beyond the bells and whistles and measure the usefulness of the e-textbooks’ interactive features. Arranging a demo with faculty technology or curriculum committees could be effective avenues to engage faculty, librarians, and IT staff in this discussion.

The article has a number of other interesting points -- addressing topics of cost, preparedness, expectations of publishers, and new entrants. Many of these issues reflect some of our own challenges. An interesting read.

E-textbook sales surge, survey uncovers drivers

Thanks to Mariana McCulley for the heads up on a new press release from Ingram Digital. According to the release, Ingram Digital saw a 400% increase in e-Textbook sales this semester over 2007 sales. Of particular interest in the press release is some of the data they share from a recent study. In Q2, Ingram Digital surveyed more than 600 of its e-book users to uncover the key drivers behind their decision to switch to digital. Results revealed that cost, convenience, and interactivity were the top three factors contributing to students' decision to purchase e-Textbooks.

News and studies like this provide some important insights into the future direction of digital course materials from the consumer/student perspective. It will be interesting to see what the fall sales numbers look like compared to this spring. By this fall, the amount of digital inventory for textbooks is expected to increase signficantly -- and will continue to do so through 2009. I would expect the main textbook publishers (which represent over 80-85% of the industry) will all have their frontlists available in digital format for sale and distribution by sometime in 2009 if not sooner. Inventory has been a barrier to adoption in the past. Other forthcoming developments in the industry will address some of the cost and convenience factors as well.

Economist piece

There was an article on e-books that appeared in this month's Economist. The article makes reference to the fact that in some book categories (with textbooks being the specific example) digital is growing rapidly. They do not cite numbers or sources though. The do go on to say that digital could help publishers recapture the used textbook market, however. The article also makes interesting references to other technologies -- such as POD. I am not sure I fully agree with the last paragraph of the article (of which some of the commenters also make note). There are some unique values provided by other players in the distribution chain (between authors and consumers) that add value, and are able to do so at a lower cost than the publishers could do directly. Improving efficiencies along the supply chain -- definitely a thing we should do. Complete disintermediation, however, is much less likely at this point in time.

A very interesting video of new technology

A friend from Canada sent me this great video clip of the first telepresence holographic video conferencing demonstration performed recently by Cisco. The demonstration is interesting, and I could see this technology having some interesting implications for higher education. Hire one prof to teach large lecture sections of "Intro 101" across many institutions -- taking Open Courseware to a whole new level, for example. Or enable a wider range of global speakers to "come" to a campus at far lower cost. Or enable multi-national student or administrative teams to work more seamlessly with each other. Or even make distance education seem to be occuring less 'at a distance.'

My favorite quote from the video occurs in a 25-30 second clip at about 4 minutes 20 seconds into the video. John Chambers, CEO for Cisco comments:

"... It should be any device to any content over any combination of networks. This is why it has to be an architectural decision and not a decision on an individual product."

That is my point precisely when it comes to course materials. We should be able to deliver any content to any device over any combination of networks, dictated by faculty requirements and student needs and preferences. Developing an architecture and infrastructure to support this type of flexibility is a key requirement for stores wishing to participate in a digital future at nearly any reasonable level.

Cost and the future of the e-book

My posting from a couple days ago on the future of the e-book generated a few comment-posts and some e-mails. I decided to take one of those comment-posts and make it into a regular blog entry. Here is the comment-post:

Anonymous said...
I am a prolific reader. One of the things that I do not understand about e-books is the cost. Why do publishers want you to pay so much? If you consider that e-books have no paper, ink, glue, etc. the cost should be much less than a hardcover or even a paperback book. Until the price of an e-book goes down to a reasonable level I will not buy into this technology. I'll continue to read for free from the library.
June 18, 2008 9:13 AM

Cost of e-books has been complicated. As one publisher noted to me, they did not know what to charge for the content separate from the format. The two have almost always been linked, but with digital, that linkage is potentially broken. That aside, there are some differences when talking about trade publications versus textbooks.

Textbooks are the more costly to produce in a digital format. It can cost upwards of five times as much to convert a textbook to different formats as it does trade books. Why? Some of it is in the complexity of the material -- inserts, graphics that might span pages, more complicated indicies, etc. With textbooks in general, there are also additional expenses that come from producing ancilliaries to support faculty (e.g., test banks, powerpoints, etc.), required peer review processes, and other factors all of which increase the cost. As we look toward digital textbooks, creating the "pdf version" of the book is one thing, but producing a "born digital version" is another. Producing such interactive versions, incorporating full multimedia and a richer learning environment is far more costly than producing the traditional version of the textbook. Reproduction and distribution costs may be lower, but development costs are significantly higher. The skilled labor to develop such born digital texts is expensive and in fairly short supply, plus we are still in the early stages, so the costs of assessing the learning outcome from different digital approaches makes things more complex yet. This gets back to the question of what is a proper price for the content. Business models are still in flux.

All this raises some degree of question around what is the source of the cost of a book -- is it for the format or for the content (plus marketing, etc.)? It is possible that the format itself (i.e., print versus electronic) has little impact on the final price. I learned this morning that the SPARK (?) group for the Association of Research Libraries (ARL) has apparently done some good work on evaluating the costs of distribution versus costs of content creation, but I have not seen the information yet. I do know there are a number of publishers who read this blog on occasion. Anyone willing (even anonymously) to share some information or shed some light on some of the economic complexities of digital versus print books?

Venture capitalists believe in digital...

I just read ashort synopsis of a study released this week. The study was conducted by KPMG and utilized a survey of 300 venture capitalists, corporate executives, and investment bankers. The study focused on digital content for entertainment. Among the interesting findings --

52% of the respondents say venture capital investment in digital content creation will increase over the next two years.

90% of respondents believe mass adoption of mobile video consumption will take off in the next 5 years, and 60 percent expect it will happen within the next three years.

There are some other interesting stats too. What is interesting here some recognition that digital content adoption is increasing across formats and that the market for digital content related goods and services are likely to increase significantly in the next 3-5 years. This seems to be mirrored in other sources on the e-book side where more publishers and other content providers are working rapidly toward releasing more digital assets into the marketplace.

Future of the ebook

In the Technology section of CNN.com there was a recent article on ebook readers, their limitations and their future. The article starts off with nothing all that new -- i.e., that ebooks, and the Kindle, are "not quite there yet," but getting close. Three key limitations are noted --

(1) Lack of extensive wireless, or wireless options outside of the States.
(2) Current readers are focused on text and mostly limited to "text-only, grayscale versiouns of otherwise colorful and lively" content.
(3) Lack of ebook inventory diversity.

Each of these limitations are ultimately surmountable the piece argues. In that process, the article does provide some interesting content and quotes. Here are some of the points of interest:

• For E Ink, the next frontier is color. Qualcomm's mirasol technology, still in development, uses biomimetics to engineer low-power, flat-panel, color-rich displays viewable in any
  lighting condition, based on butterfly wings.
• There is some interesting coverage of the recent history of e-book readers, from Sony's Librie, to the Iliad by iRex, and of course, the Amazon Kindle.
• Technology takes time to be adopted. It begins with everyone saying, "why would I ever use that," and eventually becomes a mainstream concept. Note the last quote below (noted as my favorite) for a samplinng.

And here are some of the more "quotable quotes":

• In response to the lingering fetish for the printed page, Bezos sighed: "I'm sure people loved their horses too, but you're not going to keep riding a horse to work."
• E-book sales are still a small, but fast-growing segment of our overall revenue," says Simon & Schuster's Adam Rothberg. "In 2007 we experienced a 40 percent growth over 2006. If current trends for 2008 hold, we expect that we will double or better that growth."
• Long before the success of "Brokeback Mountain," Fiction Pulitzer Prize winner Annie Proulx infamously told the New York Times in 1994: "Nobody is going to sit down and read a novel on a twitchy little screen. Ever." Today, no less than seven of her authored books are available in Kindle edition from Amazon.
• The main thing," Silicon Valley-based user-interface engineer Darryl Chin, 31, continues, "and seemingly always will be with e-books, is content. Give me all the books I want. Like CDs to MP3s, give me everything I can get physically, digitally."

And my favorite quote from the piece is from Rita Toews, author of several e-books and founder of the annual "Read an E-book Week" in March. She quips:

Print books, on the other hand, have their place. Nothing can replace a beautiful art book, or a book of photography. E-books are simply a different format for something we've had for hundreds of years. When penny dreadfuls were introduced in the 1800s they were scoffed at, as were paperback novels in the 1930s. Also in the 1930s, as farmers were being signed up for rural electrification, one of the most common responses was: "Why do we need electricity? We have lanterns!"

He

Update on Caravan Project Pilot

The following posting went out to schools participating in our pilot initiative with the Caravan Project. I am reposting it here due to other inquiries. The timing is also good as there was an excellent update and summary of the Caravan Project as a whole that appeared in the Shelf Awareness newsletter on Friday of last week.

------------------------
Originally distributed: Friday, 13 June, 2008

Hi everyone,

I am writing to provide an update on the Caravan pilot project. As we indicated back in late April and early May, just before our first meetings and the kickoff of the project, we learned that we would need to change the planned order of the project. This required moving the activities originally planned for late summer or fall (specifically, getting access to the digital assets) up by several months. In attempting to gain access to the Caravan digital assets other positive developments occurred.

First, one of the companies holding Caravan digital assets (OverDrive) informed us that they were not particularly interested in working with us to provide only the Caravan titles. It would be just as much work for them to provide us the 60-90 Caravan titles as it would be to provide all 60,000+ digital assets they provide. Having the larger set of titles and content to work with should make this project more robust. However, it also led us to realize that we could move up the proposed timeline on several other initiatives as well (more on that in a moment). Second, the other major company holding the Caravan digital assets (Ingram) has been less responsive. However, we have scheduled a meeting with them for the last week of June and we expect to make progress at that point. We expect their position to be similar to that of OverDrive.

These required changes in project scope, required some rethinking to determine what is best for both participating stores and the industry so that we can yield a successful result. The exploration into how to deliver the content in multiple formats, coupled with the sudden potential access to a much wider range of content options, has led us to several exciting new possibilities. In addition to the 14 stores currently participating in the pilot, over a dozen others have requested to participate in the past 6-8 weeks. Many of these inquiries would provide a broader range of participants, leading to a more robust pilot. Many of these other stores do not sell many university press titles, and thus might not gain much from the project as originally conceived. However, with access to the larger digital asset inventories, the project becomes more interesting and viable for other groups of stores to consider. In many ways, just by trying to launch the Caravan pilot project we have realized several outcomes of benefit. In addition to getting wider interest in participation than we hoped, we also found methods to provide a wider array of content via an equally wider array of delivery mechanisms and formats. It resulted in discovering a path to implementing the digital content strategy approved by the NACS Board in February that we had not foreseen as possible in the short term.

As noted above, our having access to a much, much larger set of digital assets opens up several other opportunities for this pilot project. It also speeds up several other timelines, encouraging us to rethink our direction. Following several discussions, we have a proposal going before the NACS Board at next week's meeting. If that proposal is approved, this project will take a different direction that will provide participating stores access to a wider array of digital content options, and some additional technical options and assistance. I am limited in the information I can share at this time, but following the Board meeting next Friday and Saturday I should be able to provide additional information and have a clearer indication of the direction this pilot project will go.

The developments in this project all represent positive opportunities for the pilot stores and the college store industry as a whole as it relates to digital content delivery. We are still working toward having working pilots in place by mid-to-late fall. Which direction we go with those pilots will depend somewhat on what the NACS Board decides at their meeting next week. Any stores currently participating in the Caravan pilot project will have the option of stepping out if the new direction is of less interest. As soon as I have more information to share, I will certainly be in touch. In the interim, please feel free to contact me with any questions you may have about the current or future state of this pilot project.

Addendum to prior post...

I pre-posted the earlier message. I recieved two responses though worth sharing:

Response #1:
FYI, this bill passed the Arizona House but failed in the Senate. The comments under the story are interesting, and rightly point out that the schools would still have to pay for most digital textbooks. They might not end up saving much, if anything.

My comments:
Those are important points -- people tend to assume that digital will be cheaper, but there is no guarantee. Many of the publishers I have spoke with suggest that the cost of producing digital materials (beyond the ".pdf version of traditional books") are more than those for producing traditional textbooks. Perhaps that is because the tools and skills required to develop "born digital" textbooks are not yet in great supply, and there is much research and validation to be done to verify that born digital content produces better learning outcomes. All of that takes money. Long term, perhaps digital will reduce the cost of textbooks for all -- but in the short term, that seems less likely.

Response #2:
The one phrase of Leff’s (paraphrased) I find interesting is: Computer-based learning is becoming the norm, she said, and can provide a variety of viewpoints, instead of those in just one textbook. That sounds potentially like code for slipping creationism in. Leff was involved in a bill to mandate, among other things, the following: Requires a public educational institution to permit the following activities in the same manner and to the same extent that secular activities are permitted: Prayer or engagement in religious activities or religious expression before, during, and after the school day. Admittedly a little paranoiac, but makes me wonder if we could end up seeing anti-Evolution/pro-Creation efforts masquerading as (or piggybacking on) digital curriculum legislation.

My comments:
Yet another interesting perspective. It relates to an article by Judith Shapiro that appeared in Inside Higher Education on Friday. Some of the comments in response to Judith's article are very interesting too and offer some interesting counter-points and considerations.

Program to replace textbooks in K-12

A recent article reports that a proposal made in the State of Arizona would ban printed textbooks in favor of digital or e-learning materials (when available). By moving to digital curriculums and banning traditional textbooks, new monies might be made available for computers in schools (K-12). State Senator Barbara Leff noted that, "The modern world has moved beyond textbooks." Opponents to the bill noted the continued presence of a "digital divide" and concerns that lower income students, or poorer school districts would be disadvantaged in this shift. Many other states are also experimenting with digital initiatives in the K-12 space. I just thought this piece was an interesting example of the theme and some of the issues. It could have some interesting implications for higher education, and it is a program that could be interesting to watch.

Text-to-speech for the iPod

Just an interesting technology tidbit -- Expressivo is now available for the iPod/iPod Touch -- allowing text-to-speech conversion. While the marketing materials say this is as good as the real person, it still sounds a little computer-like to me. Maybe because computers still just read the text in monotone and without the intonation and meaning embedded in the actual content. Anyway, for those who do not like to read their books, you can now have them read to you. You can learn a little more about this via the following article. Steve Jobs did say that people do not read anymore -- however, I doubt this is the final solution for delivering e-books on an Apple device. It could be an interesting add-on feature, though.

Follow-up piece on Copyright...

It seems draconian copyright protection is the norm today. I have spent a bit more time reading and researching the copyright and IP issues with the proposed Canadian bill. In doing so, I came across this article from New Zealand that came out yesterday. It references a discussion paper for an "Anti-Counterfeiting Trade Agreement" to be discussed at an upcoming G8 meeting. I have seen a few other references to such seizure of physical devices at borders. I wonder how it will really be implemented? My personal opinion here, but it seems like there are a lot of other things countries could be spending money on when it comes to enforcement, and it is not clear what benefit will come from this. It seems like it could be used more for international espionage than protecting IP rights. As with all things, there is more than one perspective. I am sure all of this proposal is very rationale to someone, and that in the media things have become confused or less clear. Could someone point me to some documents or provide some grounded information to help illucidate some of what is happening in this space?

Proposed changes to Canadian Copyright

A new Copyright Reform bill was introduced in the Canadian Parliament yesterday. The bill updates provisions related to digital rights management, P2P file sharing, and attempts to circumvent copyright protections. In one news article posted today, I thought it was interesting that Canada's Industry Minister couched this as a "Made in Canada" bill and not a replication of US copyright efforts. I also thought the fine structure was interesting -- minimal penalties for those downloading content illegally, and more hefty fines for those who post or distribute content illegally.

Another news article on the topic points to some serious concerns about the bill. As the piece notes:

Casting aside the concerns of major business, education, and consumer groups, the bill seeks to dramatically tilt Canadian law toward greater enforcement and restrictions on the use of digital content, leading Liberal industry critic Scott Brison to warn that it could result in a "police state."

The last comparison seems a bit dramatic to me, but reading these two and a few other pieces in the last hour does suggest that the emphasis of the bill is more on enforcement and DRM, then on promoting perspectives on intellectual property (IP) and copyright that are more in sync with protecting and balancing the rights of all stakeholders. It appears Canada is moving more toward the US model.

What would it take in Canada (and perhaps the states) to bring together the various stakeholders in one room to craft a policy that protects IP rights, while also protecting other interests? I expect that the IP and DRM issues around digital content are only going to become more varied and complex in the coming decade. Such legislation seems to protect some interests and not others, and could serve to slow down technological and commercial progress. Is there a better way?

Sales of e-book readers near 1 million???

Like the environmental piece last week, I read an interesting article this week where a writer (Evan Schnittman) went out and did some old-fashioned leg work. Here is a snapshot of some of his points of evidence and/or conclusions (quoted content is in green).

Physical E-readers to top 1 Million in 2008:

• Using data from DIGITIMES, a daily news service covering the Taiwanese IT market, in a story entitled PVI EDP shipments to grow sharply in 2008, and a simple formula, the author estimated that "the annual sales of the Sony Reader are at nearly 350,000 units. Using the same formula, Amazon is ordering an average of 42,000 units per month, which will add up to over 500,000 units sold this year." The estimate is made based on data from the article indicating that 60% of the EPD’s go to Amazon and 40% go to Sony.


• With production ramping up to 120,000 units a month these numbers will look much better - to the tune of a combined 1.4 million units over 12 months! Even with the Kindle out of stock for a big chunk of the first and second quarter, combined sales of these two e-ink devices in 2008 will most likely top 1 million. If a million devices are out on the street looking to feed, and we know they primarily eat one kind of food, ebooks, then what must this mean for the ebook sales?

E-book sales on the rise as well:

• Jeff Bezos said last week that ebook sales in the Kindle store had hit 6% of book unit sales. What this means is that of the 125,000 titles available in the Kindle store, the sales of ebooks represented 6% of the sales of those same 125,000 titles in print formats. Another interesting thing that Bezos said was that Kindle buyers purchase at a rate of 2.5 times more than print book buyers… food for thought when thinking through your ebook strategy.


• Assuming that anyone who buys an e-ink ebook reader is doing so to read ebooks, lets assume that 10 ebooks a year is a reasonable purchase estimate. Using this logic, we should see 10 million ebooks purchased for these two devices in 2008. (Author does provides some background to make this estimate seem realistic and not just a SWAG).


• Using other data and estimates, the author goes on estimate $120,000,000 in ebook sales for the Kindle and the Reader in 2008, double all ebook sales in 2007.

Future e-book growth:

• Success in technology, like everything else, leads to more success. It’s not uncommon to see five-fold growth the year following a successful technology product launch. Think iPod, think Wii, think Blackberry. Whole micro-economies emerge around products that range from accelerated content creation, and all sorts of aftermarket products and services. Versions 2.0 and beyond create better and better devices. The better the devices, the more accessories, the more content there is, and soon a whole world of business opportunity is rolling downhill picking up speed. With this in mind, I can easily imagine the success of Kindle and Reader dramatically expanding next year and growing by a factor of five. If that happens, then the formula above leads to a completely new ebook economy. Five million devices would mean ebook sales of $1,200,000,000, which, by my estimation, is 1.3% of the current global book market of $90,000,000,000.

Still think e-books do not matter? A final quote from the article was perhaps my favorite, and one I will use again. Schnittman comments:

This reminds me of a comment I heard from a music industry executive at a
conference a couple of years ago. “One day there was the iPod and iTunes. The
next day 20% of our business was digital. The day after that more than 50% of
our revenues came from digital music. Yeah, we believe in digital music now.”

This year a number of stores saw digital sales hit up to 20% in some courses. Yes, that is not universally true for sure, but what will we see tomorrow? Please go ahead and read the full article. There is more data and the logic can be followed, and some of the follow-up postings are also interesting.

Knowing where the digital market share is going...

I read an article (reads like a press release) this morning about some new offerings by ebrary. ebrary is just one example of many companies in this space, but they are a good example of the types of companies college stores should be more aware of in the digital content space. They have a software-based e-reader technology and likely work with many of our campus libraries. While the article spoke mostly to new content databases being offered to the corporate community, what is of interest is what content was being offered. The articles notes:

ebrary(R) today announced the availability of two new subscription databases of e-books, manuals and other authoritative content in Engineering and Business. With contributing publishers such as Elsevier, CRC Press, Pennwell Publishing, John Wiley & Sons, The McGraw-Hill Companies, Woodhead Publishing, Gulf Publishing, and World Scientific, ebrary's new Engineering Database features popular handbooks, manuals and other technical titles spanning a wide range of engineering topics such as Aerospace, Chemical, Civil, Electrical, Electronic, Environmental, Materials, Mechanics, and Petroleum Engineering. ebrary's new Business Database covers key topics in eadership, Management, Human Resources, Sales & Marketing, Finance, Investment, Accounting, and General Business Skills from such esteemed publishers as AMACOM, Elsevier, John Wiley & Sons, Kogan-Page, Ltd., and Dearborn Trade Publishing.

Do the publishers and content areas sound familiar to to any of the college store readers of this blog? If about a third of students are getting their digital textbooks from libraries now (from the NACS 2008 StudentWatch study), then do you know what digital textbooks your library really offers? Here is an area where you can start to interact with your campus librarian. Do some background research to see what titles they may be offering, and what the readership is like. As we talk about competitive intelligence and understanding what market share we are losing (and where we are losing it), then here is a source of potential information. There may be opportunities for us to work with campus libraries and this information--and there may be opportunities for college stores to work with ebrary and similar offerings as well.

Course material content licensing by campuses is not a new phenomenon, and it is a trend that is likely to grow. Store textbook managers should be monitoring this trend closely and considering ways to work with other campus constituencies and this content.

simple thought...

Thanks to Michael von Glahn for the idea for today's post. It's an old quote, but still a good one:

"The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn."

-- From "Rethinking the Future" by "Future Shock" author Alvin Toffler.

As this blog talks a lot about innovation and new developments in course materials and technology, the quote seems particularly relevant. How many of us do things because "we have always done them that way?" Change can be scary, but it can be exciting too. Sometimes you just have to take a leap of faith and innovate. (Of course, having done your homework in advance and knowing that you are not leaping blind off a cliff is not a bad idea either.)

Enjoy the Sunday! I am on my way to an ECAR/CIO Symposium in Colorado, where new ideas always seem to abound. I will post some of my take-aways from that event in the days ahead.

Technology innovation on campus

IT (or information technology for the acronymically challenged) is going to be part of the future of college stores, for better or worse. Hopefully for the better. Whether it is e-books and digital course materials, new forms of POS, new types of products and services, data analytics, websites and online transactions, or something else. For those of you who do not read the campus IT news sources, it might be time to start doing so. There are a lot of good resources out there -- such as the publications produced by EDUCAUSE, and particularly the Education Learning Initiative (ELI) and EDUCAUSE Center for Applied Research (ECAR)* units.

Another source for many interesting news stories is Campus Technology. An article by Trent Batson on innovation in higher education IT for academics or learning has some interesting implications for us in college stores. In the piece he argues for a "technology innovation unit" -- a source that is constantly trying, vetting, and implementing new solutions and constantly putting old ideas "out of business." (The last section of the article is most worth reading). In the college store industry I have met some interesting stores that have done something like this, and we are working toward more innovation along this vein as it relates to the digital content area within NACS.

While there are many other worthy sources in this area, one other place to keep your eye on is Inside Higher Ed. They have a good number of interesting articles on a range of topics, including textbooks. For example, earlier this week there was a viewpoint article on the Value of a Textbook by a faculty member at the University of Minnesota. While the article provides an interesting perspective, just as interesting are some of the responses posted to the piece. the voices of some of our customers. This particular piece is a good example of the complexity of the issues in our industry and the many different perspectives -- and some passionate feelings -- individuals have about this topic.

Looking at such other sources is an important task for top management -- as part of the strategic environmental scanning process. I have said it before, but all top managers should be spending at least one hour a day away from the "tyranny of the tactical" and thinking about strategic issues and challenges to their store and the industry. Taking such steps is a vital to organizational survival over the long term, particularly as we are poised to see some dramatic changes within the next 3-5 years across the industry.

Reading other sources like these opens the doors for college store managers to engage in conversation with other campus stakeholders as well. If you understand or can see the "pain points" or perspectives of others, then an opportunity to be part of the solution. An hour a day spent on strategic thinking or activities is well worth the investment.



* As a matter of full disclosure, I am an ECAR fellow, so I have some bias here. I think the publications produced do have value for the wider campus community, though.

Paper or Plastic?

E-books are supposed to be green, right? They are supposed to be an environmentally friendly solution to traditional print. Some colleagues from NACS sent me a really thought provoking article that appeared in the Environmental Science & Technology Journal last month. The article does a life-cycle analysis of print sources (books and newspapers) versus their electronic equivalents delivered on an e-reader. The author, Erika Engelhaupt, did some fascinating research into the topic. While a clear-cut solution to the question of "paper or plastic" was not forthcoming, I found the piece did give me something to think about in terms of assessing the short and long term environmental impacts of the two competing technologies. I thought the overall approach to the life-cycle analysis itself was quite interesting, particularly in these times where new devices (e.g., cell phones) come out so fast that many of us find ourselves moving toward increasingly shorter adoption cycles. I think Engelhaupts piece gives one a moment's pause to think about the true meaning and impact of green -- so that we might make more informed decisions, even if the answers or conclusions are not clear cut. An interesting read.

Ray Kurzweil piece

There was an interesting piece in the NY Times this week on Ray Kurzweil. Many of you have probably had the opportunity to see Ray present, or may have read his book, The Singularity is Near. He was the keynote at our Innovate conference last year. I have seen him present a few times in the past couple years and he is always fascinating -- even if the presentation itself changes little. You can see a streaming video version of his presentation through the TED videos, taken from his TED presentation in 2005. (The TED Videos are a great and interesting resource for ideas, by the way, if you have not checked them out, you should. Some of them are really fantastic).

Anyway, Ray's message is a very relevant one to those of use awaiting the future of digital books, or digital textbooks. The concept of exponential growth and adoption patterns of technology are both interesting and significant. Ray's predictive models in this area are among some of the best contrbutions to our understanding of technological innovation, in my opinion. I was at another event back in February, where the question was "how long until our iPod moment arrives?" That is a question I have brought up in this blog before. Kurzweil's law of accelerating returns suggests that it might be closer than we think. The concept can be best summarized in a phrase from Rich McDaniels' -- long time thought leader within the college store industry. I once heard him quip that "Sometimes it takes a long time for change to happen quickly." Essentially -- technological change starts out slowly, but once it takes off, it takes off far faster than anyone anticipates. It is sometimes a hard message to take in, but it is certainly one worth thinking about for a while. Consider it your strategic thought problem of the week.

Interesting future e-reader device

A colleague forwarded a video to me today on the future of the e-reader device. The video is in French, but do not be dismayed, the general premise and concepts are still quite apparent. My conversational French is quite rusty, but I was able to get by and get some interesting ideas from the video even with "mute."

The video can be found at Editis and is entitled "Possible ... ou Probable." You can access it from the link by selecting "voir la video" via either a high speed (streaming téléchargement rapide) or low speed (streaming téléchargement plus lent) format. The video runs about 10 minutes in length.

Some of the interesting segments are when the gentleman was able to scan the e-book over the regular book at the bookstore and then check out at the register. The interactive travel guide they were using via the e-book was also very cool -- in part because it appeared to be location aware.

How long until this type of technology is reality?

-M

Upcoming Webinars

There are a couple upcoming webinars coming up that might interest a few readers of this blog.

10 Tips for Using Digital Book Technologies to Drive Sales and Create New Consumer Experiences. This webinar is being presented by Book Business on Thursday June 19 at 2pm EDT. The speaker is Malle Vallik, Director of Digital Content and Interactivity for Harlequin Enterprises, Ltd. I have heard Malle speak a couple times at IDPF meetings and she is always interesting, in my opinion. Some of the things Malle is doing in the digital space at Harlequin are very innovative. The program for the webinar sounds interesting, and if you can't make it on the 19th, it will be available via archive for about 3 months. You can find more information, and register online, by following this link.

Digital Content and Educator Practices--Are Publishers Prepared? While oriented towards publishers, the description for this webinar sounds like it will be relevant to college stores as well. As part of the session they are expected to be discussing a research report on "the state of digital content in America's schools (2007-2008). The session is expected to cover both what is happening in K-12 with digital content, and how publishers are adapting to changing technologies. From an environmental scanning and competitive intelligence perspective the session should be informative. This webinar will be held on June 13, 2008 from 12-1;30 EDT. While the other webinar is free, this one has a $249 registration fee per location. You can find more information by following this link.

Photonic beetles of all things!

Okay, I have been in a real "stretch my mind with some new thoughts" mode lately. My last few posts are probably showing some of that. Former students of mine are always sending me little news clippings and stories about different emerging technologies or ideas that they find interesting or that remind them of some topic we discussed in class. One of them sent me a recent article from Wired Magazine about photonic beetles. Okay, maybe this posting is the sign that I really need to take a vacation -- or at least a full weekend off from work -- but stick with me for a moment. There is a relevant thought here.

So the article is about how for decades scientists have been trying to create new forms of computer chips based on light (more accurately called photonic crystals), but have failed. "Enter a beetle known as Lamprocyphus augustus," the articles notes. Apparently through evolution this bettle has ended up with the perfect molecular configuration to produce the photonic effect researchers have been seeking. If they are successful, the next generation of optical computing technology could do in a second what currently takes computers days or weeks to perform. The discovery was made by "sheer luck" because an undergraduate student had studied iridescent beetles as part of an high school science project.

So what is the relevance of this story to this blog? It is an interesting example of innovation and the payoff that can come from experimentation. It is also an example of how we need to share ideas with others, pull our customers into the problem solving process, and be open to new ideas and perspectives. You never know where the next great idea might come from, but if you are not open minded or willing to look -- even at the ideas that seem somewhat crazy -- then potential breakthroughs like the photonic beetle may pass you by.

Recent WSJ articles

There were a couple interesting articles over the past week that appeared in the Wall Street Journal. The first was an article by Gordon Crovitz on The Digital Future of Books. I thought it was a pretty interesting piece that questioned how the change in communications media might change the way we communicate, with potential to change the nature of the written word. In one passage he writes,

Aristotle lived during the era when the written word displaced the oral
tradition, becoming the first to explain that how we communicate alters what we
communicate. That's for sure. It's still early in the process of a digital
rhetoric replacing the more traditionally written word. It's already an open
question whether constant email and multitasking leaves us overloaded humans
with the capability to handle longer-form writing.

How we communicate alters what we communicate. I heard not long ago that the invention of page numbers did not occur until nearly 40 years after the creation of the book. Today we can not imagine a book or other forms of the printed word not having something as obvious as page numbers. So why should we imagine that books will remain the same with a communication medium like the Internet and all it offers?

The question I think many of us grapple with is what we (or the next generation) will communicate given how the Internet changes communication. In yet another passage, Crovitz notes:

The book introduced a disciplined way of thinking about topics, organized
around contents pages, indexing, citation and bibliography. These are at the
root of Web structure as well. One theme for the next annual Conference on the
Book is that the digital experience could simply be an evolution: "The
information architecture of the book, embodying as it does thousands of years'
experience with recorded knowledge, provides a solid grounding for every
adventure we might take in the new world of digital media.

Crovitz ends his piece on a note of hope that technology may return us to the written word in a new way, breathing new life into words and their meaning.

Not long after Crovitz's piece, there was a rebuttal article by Jason Epstein that also appeared in the WSJ. In the rebuttal, Epstein paints a different view, suggesting that print-on-demand will be the more likely path of digital books rather than reading on a screen. That is quite possibly true while we continue to digitize content and think about stories in a linear way. Perhaps that is why it took 40 years to come up with page numbers -- because we needed a generation or two to grow up with a new technology in order to view it differently. Perhaps the great novel of the next generation will be a video game -- interactive and complex storylines that play out some of the universal stories and themes that underlie much of the traditional literature base. I know, I know, it sounds like heresy -- but maybe in 40 years there will be a development in video game storytelling where people will wonder why we told stories or passed on knowledge in any other way. It will be as obvious to them as page numbers are to us, or so it will seem.

Anyway, I thought the two articles were both interesting reads and provided some thoughts to chew on. Good strategic thinking and innovation both require thinking about future possibilities. These two pieces could serve as a good catalyst for such a discussion.

New startups

I always find start-up companies interesting. The thrill of innovation and entrepreneurship. The birth of an idea foist upon the market that may or may not yet be ready. I have worked with a fair number of startups over the years, helping them evaluate their business plans or providing feedback on their direction. Some have made it, and made it big. Others, well, let's just say they had ideas whose time had not yet come.

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.

Some stats of interest

Due to some expressions of interest -- here is a brief 1-page industry trends update I wrote recently for some internal documents. I have a pretty hectic travel schedule this month, so I will apologize in advance for having fewer postings to the blog throughout June. July onward is looking like far less travel so I should be able to do a little better then on regular and frequent postings. I will note that some of the stats below are ones that I have commented on in the past. I am posting the combined set here due to a couple recent requests.

-------------------------


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.

Big News coming at Innovate 2008...

It is a bit early to confirm yet, but we are expecting some big news to be announced at this year's Innovate 2008 conference. The conference will be held in Minneapolis on July 11-12, a much cooler location in July than Tampa -- host of the first Innovate conference in 2007. This year's program has a great lineup of sessions. This year's focus is more on retail technologies, but there will be some sessions on digital content as well. Last year's sessions by Ray Kurzweil and Jim Carroll were fantastic, and will be hard to beat, but I think we have some great speakers lined up again this year. We also added more networking opportunities and changed the workshop format -- all in response to feedback from last year. In the next couple weeks I will post some more detailed information about some of the sessions expected at the conference. It is shaping up to be a great event and the expected news release will make for another good reason to attend.

Branch Office...

It is a holiday weekend here in the states. I am traveling for work at the moment, but this recent comic in Being Five was worth sharing. Those of you who telecommute as I do will probably enjoy this one.

Another e-reader...

E-readers continue to enter the market, with different innovations -- and prices. I recently came across an article on another blog about the Astak e-book reader. They call it the "E-book Mentor." Price will be low (starting about $150 for the low-end model, $350 for the high-end model) with the now-standard e-ink display for such devices. The interface looks a bit simple, somewhat more like a palm reader. There will be three different sizes, and a variety of features, including wifi and a touch screen. There are pictures and more spec info available through the above link, or from Astek at their product page. The one thing I note is that it does not look like the book supports many content formats. Maybe they need to partner with other content providers? It is interesting to see the product variation on a theme and to see how common features are emerging among the e-reader options. As content inventory improves it will be interesting to watch what features emerge next. Moving beyond the limited number of shades of gray currently available is a key next step in my opinion -- that will be necessary to make the devices a good tool for textbooks or e-books with more complex charts, graphs, or pictures.

Tracking the origins of digital content

Just a small news clip today...

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.

Digital Book 2008

Finally, the customer is king at last -- or at least an heir to the throne. Publisher's Weekly published a good article on last week's Digital Book 2008 (IDPF) meeting. Once again, I missed this meeting due to presentations at another event. The Publisher's Weekly makes some important observations worth calling to the attention of readers of this blog. For example:

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.

CourseSmart partners with Ingram Digital Ventures

Just a quick note today --

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.

Some fun videos

Cheers to the Mizzou University (University of Missouri) bookstore for some fun youtube videos. The videos spoof the Mac vs PC videos by Apple showing students who buy from the college store versus the Internet.

http://youtube.com/watch?v=92gGhIb7g2Y
http://www.youtube.com/watch?v=DgzyzGBSry4&NR
http://www.youtube.com/watch?v=wwQX3va4Yqo
http://youtube.com/watch?v=DtkZUHIbt20
http://youtube.com/watch?v=XtYtjsasVfY

It's Monday, so pop a bag of popcorn and prepare to enjoy about 5-10 minutes of spoof videos.

Enjoy!
M

IBS announces results of London book fair survey

Many of you probably already saw this piece, but I have been traveling and am behind on my reading. About a month ago IBS announced the results of the survey of publishers it conducted at the 2008 London Book Fair. A short synopsis of key findings is available online. Here are some of what I found to be more interesting points:

• 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

The ending quote is also telling,

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.

An interesting address...

I read an interesting short article on a recent address by Random House chair and CEO Gail Rebuck on digitization and the future of books and ebooks. Rebuck's comments are relevant to the college store industry and re-emphasizes (in my opinion) the opportunities that stores and publishers have if we work together. That may require a little more open mindedness on both of our sides, but the opportunities are there.

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.

Experimenting Pays Off

I missed the BISG "Making Information Pay" seminar last Friday, but heard that it was very good from a couple of attendees. An article on one of the panels appeared in Publisher's Weekly over the weekend. The panel's focus was on how experimentation with digital is paying off for a group of organizations -- including a college store. At this stage of innovation and emerging technology -- particularly with a radical change visible on the horizon, a few things are critical to future organizational success for both publishers and stores.

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.

Next generation of college kids

The NACS' Environmental Scan Think Tank (ESTT) held one of our regular meetings recently. We do so about three times a year, roughly 6-8 weeks before each board meeting. For this session we each did some background research and reading to look at trends and developments in the K-12 space that could affect college stores in the future. A difficult task, since things are changing so quickly these days. As I was preparing to start typing up the notes from our meeting, I came across the following NY Times article on virtual worlds in the"tween" space. It is an interesting article about an emerging technology and the kids that use it. The main child in the article is only 10 years old. What will it mean to us when kids like this enter college more en mass, perhaps in just a few short years? What steps should we take now to prepare? I have some thoughts -- but what are yours?

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.

Digital Pen and Paper

In David Pogue's State of the Art column last week he introduced an interesting gadget -- a digital pen. What is cool about the device is that it can record audio while taking notes like a ball-point pen. It requires special paper (the real downside), but if you tap the pen against a prior set of notes, it will recall the audio recorded when the notes were taken. Of course the audio and printed notes can be uploaded into the computer and all the other normal things we would expect. Of course, this is just the first generation of this technology, but one could easily imagine the uses it might be put towards once it matures a little and gets coupled with some other tech devices or capabilities. The video segment on the column web page is worth watching (at about 4 minutes in length). It earned a "very cool" from me -- yet another gadget to think about -- "boys and their toys" as the saying goes. I could see some real uses for students in the classroom though. Perhaps integrated with a clicker?

Just a cool emerging technology to think about on a Monday afternoon.

A New Life for Out of Print with POD

An interesting article appeared last week in the UK's Guardian. The article talks about how POD (print-on-demand) may help consumers and publishers alike by enabling access to books no longer in print. One of the lessons we seem to be learning about POD, which this article reinforces, is that it works well for fairly small runs, but breaks down with larger runs. The article does a good job of presenting different POD initiatives and some of their impact within the marketplace. Thanks to long-tail economics, niche titles have a marketable value again. For stores, this may represent opportunities to reduce costs or generate revenue from lower-number print runs. The article also cites some other popular POD developments and players, such as Lightning Source, Amazon, and Lulu. At NACS we are about to launch a taskforce to further explore some of the recent opportunities presented the association to implement POD at the store level. Since not every store can afford an espresso high-speed book printer, we are looking at and for some different options, including some regionalized POD models. In doing so we hope to reduce material costs for students, support environmental sustainability efforts, and, ensure a place for stores in an increasingly complex content environment.

New iRex iLiad Book Edition

In a press release e-mailed to me and many others today, IRex announced a new book edition of their e-reader, available for sale later this week. Unlike the current IRex iLiad reader, the new reader will not have the built-in WiFi module, which they have used to be able to download news papers. All other features will be the same. The cost is expected to be 499 Euros, which will price it out of being competitive in a US market where both the Kindle and the Sony reader are available for under US$400.

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.