Holistic Publishing 1O1: New in Textbooks 2011

Digital technology is transforming the world of textbook publishing much as it is changing every other aspect of the book world. Digitization is bringing down the cost of textbook content, transforming static print works into interactive learning experiences and allowing publishers to create and customize content, be it for an individual, a specific class, or an entire university.

Indeed the wave of new mobile devices—from tablets and e-readers to ever more powerful smartphones—has reached a level of sophistication, luring students away from print and becoming a bigger part of the educational landscape.

While the print textbook is not going to disappear anytime soon, students and educators (and parents) are demanding that publishers address the escalating costs of print textbooks. Rental programs—which can cut the cost of textbooks by as much as half—by companies like Chegg have been taken up by Barnes & Noble and other college bookstore retailers. Indeed, B&N just expanded its rental program to all of its 630 or so college bookstores. And while the exact size of the rental textbook market is hard to judge, McGraw-Hill CEO Terry McGraw estimates that textbook rentals will be “5% of the new and used book market” this year.

But in the evolving new world of textbook publishing, the conventional textbook (including loose-leaf binders), rental programs, and customized print content, combined with online and offline access through PCs and apps for the iPad, iPhone, and other mobile devices, are in practice often combined, allowing students to use content efficiently and conveniently. Online learning environments like McGraw-Hill Connect and WileyPlus revamp the learning and teaching model, bringing together textbook content with tutorials and quizzes: students get immediate feedback and professors can customize lessons, provide the feedback, and track student progress far more easily.

Professors also play a bigger role, no longer simply picking this or that textbook but taking advantage of programs like Pearson Custom Library and Wiley Custom Select: databases of content from across their lists that allow professors to essentially create their own texts—the evolution of the customized coursepack anthology from a dubiously legal photocopy made at Kinko’s.

“Print will not go away, but there’s a revolution going on,” says Pearson spokeswoman Wendy Spiegel, pointing to the growth of customized content printing at Pearson and a growing “customer-first” approach that gives students and professors content in whatever format they want. “There’s a holistic approach that technology can bring to content that you don’t get with static print.”

Technology is also driving growth in print textbook content—in particular, customized textbook content as well as more efficient digital offset printing for short print runs—even as it transforms how students learn. According to BookStats (the joint AAP/BISG program of book industry sales), higher education led all book categories in growth over the 2008–2010 period, with sales rising 23%, to $4.55 billion. According to BookStats, by far the largest segment of the college market is neither solely print or digital, but a combination of both.

Book manufacturer Courier Corp. reports that sales to the education market were up 10% in the third quarter of fiscal 2011 and up 6% through nine months, reflecting higher sales of four-color textbooks for colleges and universities plus increased demand for customized texts. To meet demand, the company has installed new HP four-color digital inkjet presses at its Courier Digital Solutions facility in Massachusetts. Courier CEO James F. Conway says, “The college market keeps chugging along, with customized textbooks growing even faster.”

With Pearson’s Custom Library, Spiegel says, a professor can use the database to select content from multiple Pearson titles and even use personal or open source content from the Web to create a unique print publication. The materials “don’t even have to be Pearson Content,” says Spiegel, emphasizing that Pearson will clear the rights for non-Pearson material. PCL content can be accessed and chosen by the professor online or PCL will provide a field editor to assist the professor to compile and use the service. “We’ve produced thousands of books in custom formats based on designs from professors, deans, or instructors. Yes, it’s like coursepacks, but the whole process is more efficient,” Spiegel says. And of course the product, like all Pearson titles, can be made available in print or digital formats.

Higher Education Sales, 2008-2010 (in millions)

“Changes in the product lifecycle of our print business are yielding benefits,” says Joseph S. Heider, Wiley senior v-p, global education, who notes that all of these trends are represented in John Wiley’s higher education results, with fourth-quarter revenue growing 8%, to $48 million, and “nontraditional and digital” products up 44%. Nontraditional and digital products include e-books, digital content, custom publishing, binder editions, and WileyPlus.

Heider points to “advances in print technology that allow shorter print runs” and “enable us to fulfill orders to customers’ exact specifications and deliver products quickly and efficiently.” Indeed, a “strategic” approach to printing allows Wiley to “better control inventory and minimize potential waste. File sharing and printing closer to a warehouse or the customer mean we can reduce packing, shipping, storage, and, ultimately, our carbon footprint.”

While acknowledging “our future growth will be digital,” Heider is quick to note that “print is still very much in the picture.” Revenue from digital products accounts for 16% of Wiley’s global education business, up from 13% the previous fiscal year—that means print generates about 84% of its revenue. “Although it’s impossible to predict with precision, the digital migration will continue to gain momentum,” Heider says, adding, “I believe that half of our global education revenue will come from print products within three to five years.”

Much like the other publishers, Wiley’s educational publishing is driven by the demand for lower pricing and customization. Heider points to programs like WileyPlus, an online teaching and learning environment that actually replaces print, offering digital textbook content, tutorials, quizzes, and, most important, immediate and constant feedback from professors. WileyPlus has more than two million users in 26 countries, and Heider says 78% of the total number of students issued codes for the service “have been validated. They’re using it.”

On the other hand, there’s Wiley Custom Select, which lets instructors create their customized print or e-book content online from Wiley textbooks and manuals or even upload their own content. Professors can add chapters, and thanks to XML tagging (which allows digital content to be turned into other formats quickly), the service can be even “more granular,” offering paragraphs, sentences, and even images. Heider says custom publishing and digital content is luring students away from the used-book market, long a vexing problem for publishers. “Digital is not a complete answer to used books, but we can lower the price relative to print and it’s a better deal for students. They buy every semester, there’s been no drop-off in the backlist.” And Heider is quick to point to the Wiley Faculty Network, a kind of traveling informational road show that incorporates webinars, phone support, and physical site visits to teach faculty how to use this bonanza of digital and analogue teaching materials. “It’s a service we provide as part of an adoption,” Heider says, “and we pay for it.”

Yes, digital technology is shaking up the educational publishing business and will certainly affect the print side of the business. But Heider says, “There’s also more access to more of our content than ever before.” Studies are beginning to show that, thanks to the iPad, students are warming to digital reading and that digital content can produce a better, more efficient learning environment.

“We’re out to create a better learning experience,” Spiegel says, referring again to Pearson’s “holistic” approach to educational content: “We expect digital to drive learning and increase graduation rates going forward. We see print and digital working together, but the balance will change and new devices will speed the adoption of new alternatives.”