Did the College Textbook Bubble Burst?

By Kate Rogers – Money 101 – Published October 10, 2013 – FOXBusiness

Parents and students are often left feeling the pains of sticker shock after writing a college tuition check, but they’re in for another financial blow when it comes time to pay for textbooks.

The cost of college textbooks have been on a steady rise over the last several years, leaving some experts worried they’re the next bubble to burst.

Judging by inflation rates, they just might be. According to the American Enterprise Institute, textbook costs have increased by more than 142%, compared to a 44% increase in consumer prices in general from January 1998 to July 2013. What’s more, the price increase for recreational textbooks has been only 1.6%.

AEI reports that adjusted for inflation, these books have increased in price by nearly 100%, while recreational book prices have fallen by more than 40%. The trend is being driven by upward trends in overall college costs, the institute reports.

The numbers are staggering, but some experts say the bubble has already burst.

“We are past peak book prices,” says Richard Baraniuk, Rice University professor and director of OpenStax College, a nonprofit organization that develops and has educators review textbooks that are offered for free to students. “And if you look at recent surveys, nearly seven in 10 students are no longer purchasing college textbooks, and that means the marketplace is starting to turn away from that price model.”

Baraniuk says new models will begin emerging on how students use textbooks—whether they went, read online or electronically or share–and that publishers will also have to adjust.

“It’s not just selling a book anymore,” he says. “It’s marketing and building a product around a book.”

Frederick Hess, director of Education Policy at AEI, says the bubble has paved the way for more open access content, and students are now adapting.

“It’s not much different for students than what their parents are experiencing with newspapers,” Hess says. “It’s a steady erosion; like the music industry from 1995 to 2005. You are seeing people read papers less, continuing reading online, and it’s not like the bottom has fallen out yet. It’s a mix-and-match at some schools, certain schools are procuring more technology, but some districts won’t replace textbooks.”

For college students, power will be returning to publishers, as students may not be able to buy used textbooks anymore, if reliance on technology becomes heavier. But both Baraniuk and Hess agree the move may benefit students and stabilize pricing.

“I think it’s a good thing, because rather than having prices continue to rise, [open access] is lowering costs and increasing access,” Baraniuk says.

http://www.foxbusiness.com/personal-finance/2013/10/10/college-textbooks-next-bubble-to-burst/

More school textbooks going digital

 from heraldtribune.com by Gabrielle Russon

SARASOTA - Ancient history can be dry, and, let’s face it, middle school is a tough crowd.

But in Brittany Shurley’s social studies classroom, there is cheerful banter as students engage in what they’re learning at Booker Middle School. There’s plenty to catch their interest.

Some days, the sixth-graders use Kindles and laptops to read their digital textbooks. They watch a National Geographic video on what it was like deep inside Egyptian tombs. Today, they are designing a magazine and scrolling the Internet for pictures on their devices.

“There’s so much we can’t do with just the flat book,” Shurley says.

The way students learn is dramatically changing as local school officials prepare for the possibility that thick paper textbooks might disappear. At a recent School Board workshop, Joe Binswanger warned textbooks and other instructional materials could be digital-only within the next five to eight years.

Binswanger, the Sarasota County district’s information technology director, later compared the district’s textbooks to the music industry.

Remember the 8-track? What about records, followed in line by cassettes and CDs? (Come to think of it, ever reminisce of those CD collector clubs?)

“That’s why you don’t see the music stores like you used to because people don’t go there to get their music anymore. They download it. And in similar fashion we’re watching that happen with books,” Binswanger said.

Already, Sarasota County schools are bracing for major changes.

With a price tag of about $1.5 million, the district is boosting its infrastructure for when more students log onto the Internet, Binswanger said.

It’s a remarkable investment considering that only two years ago, the district ban on students bringing cell phones and handheld devices from home was still intact. Sarasota County schools lifted it in 2012-13 school year, as long as teachers gave the OK in classrooms.

More devices, more bandwidth

In the majority of the county schools, four classrooms share a wireless access point in every building.

Only about 38 percent of the buildings rely on stronger coverage — one access point for each classroom, plus high-density coverage in the lunch room, media center and other gathering places.

By the end of this school year, the beefed-up coverage should be built throughout the entire district, Binswanger said.

In neighboring Manatee County, boosting infrastructure so schools are equipped to handle more devices also is an issue, said Diana Greene, the district’s deputy superintendent of instruction.

It become more pressing since the state requires Florida districts to spend at least 50 percent of their instructional material dollars on digital content by 2015-16, according to the Florida Department of Education.

“Currently, we’re probably almost at that point,” Greene said of the state law. But “it will take five to eight years before we can have our infrastructure completely ready for a one-to-one device. With the way technology is changing, it could be an iPad. It could be an iPhone … It could be a tablet. It could be a number of things.”

During a quick break from the Egyptian lesson, Shurley asks her students how many own cell phones. The majority of hands shoot in the air.

Several sixth-graders say they first started using smart phones at age 9, 10 or 11.

Taymilia Brown’s phone came around age 8, which made her “kinda special,” she says.

She watched funny videos and stayed in touch with her father when she moved away.

But the now-11-year-old also uses it for more serious purposes: She watched an instructional online video on multiplying fractions from the Khan Academy, a free Internet teaching tool.

Taymilia is what Shurley refers to as the “technology generation.”

Desktops obsolete?

For some young people, the desktop computer is rendered obsolete.

A kindergarten teacher recently observed she had seen students touching the computer screens because they thought they were iPads. They didn’t know what a mouse was.

In Manatee, officials want to tap into technology and expand it in elementary schools. A way to pay for that could be from a $30 million federal grant the district is vying for, Greene said.

At Booker Middle, Shurley says she already knows her students are connected to their technology. It’s an undeniable fact.

Her job is to teach them useful things they can do with that technology.

She encourages them to email each other for the Egyptian magazine project, write their articles on Microsoft Word and soon they will create their own PowerPoint presentations — things adults do in the real-life business world, she says.

“We need to set them up for success,” Shurley says. “If they don’t know to use (technology), it’s going to be a loss when they graduate.”

In Shurley’s class of 22 students, there’s a surplus of devices: 12 laptops and 12 Kindles to share.

But district officials are also grappling with what happens when the students go home.

What good is an online textbook if their parents can’t afford the Internet?

There are 14 Title 1 schools where high numbers of students receive free or reduced lunches because their families are low-economic status in Sarasota County. In Manatee, there are 24 such schools.

Booker Middle is on that list.

Shurley asks her students how many live near the library or McDonald’s, the beacons of free Internet. Again, many hands go up in her unofficial survey.

Binswanger also points out many families are “creative” with technology during tough financial times. Some, for example, use smart phones for their Internet instead of computers.

But he acknowledges, in a digital-only world, district officials must listen closely at the school-level to hear if teachers report children not doing homework simply because they can’t.

“Just being blunt, it’s something we’re going to have to continue to monitor,” Binswanger says.

http://www.heraldtribune.com/article/20131029/ARTICLE/131029597?p=1&tc=pg

 

 

Why Hasn’t The Tech Industry Disrupted The Textbook Industry Yet?

From Forbes.com

by Gagan Biyani, Founder of Udemy, on Quora

My view is that the innovation required for textbooks is far beyond what most companies are doing. In fact, I think most entrepreneurs (and their investors) are completely missing the boat here.

Think about WHY people would ever change from a physical to an electronic textbook. In the consumer world, we had the technology to move physical books to digital books over 10 years ago. Why weren’t we reading books on our computers before 2007? One answer: the Kindle, and other similar portable e-readers (iPhone/iPad included). Moving books to digital was not the real value prop – the value proposition was having a lighter, handheld library on the go! Until that was possible, nobody wanted to read digital books.

With textbooks, it gets a bit more complicated. First, we’re dealing with an enterprise-style buying process. The textbook publishers are also facing a major innovator’s dilemma. As a result, the costs have not come to parity (aka you have to buy the same textbooks but now you also need an iPad or e-textbook reader). Second, it’s a MUCH smaller market (in terms of # of consumers), so you need greater penetration to make the economics work.

I think textbooks need to do MORE than just take their content digital. There are 2 aspects to this:

  • Media. Personally, I think too much focus is on collaboration and not enough on rich media. When I’m learning how circuits work, it would be awesome to have a model of a circuit on an iPad that I could play around with. The problem is taking this approach to all textbooks will cost millions of dollars. However, I am sure that this will eventually lead to richer learning experiences.
  • Price parity. You have to have a company brave enough to bring the cost of digital textbooks to parity with buying physical textbooks. Amazon did this with the Kindle and ebooks – and stuck it out for years of subsidizing ebook publishers, taking a loss on Kindles sold, etc.

The problem is that #1 and #2 are very hard and capital-intensive. The alternative has been startups focusing on the much more scalable, but far less useful, aspects of digital textbooks: (A) Social and (B) Note-taking/highlighting. For (A), I just think its absurdly overrated. I don’t think college students will buy digital textbooks solely so they can collaborate with their friends. They feel like they do that anyways. For (B), it is a real value to be able to write notes on the page without destroying the book, but its not ENOUGH of a reason to force switching.

Ultimately, someone has to provide a digital textbook experience that is so kick ass that it encourages consumers (students at Universities) to switch. They also have to figure out how to get the costs down while staying in business, and to obtain buy-in from the publishers.

I agree that it is already happening, but if you want to know what will cause the “tipping point,” I think its all about media and pricing.

http://www.forbes.com/sites/quora/2013/10/28/why-hasnt-the-tech-industry-disrupted-the-textbook-industry-yet/

Zookal will deliver textbooks using drones in Australia next year!

From CNN.com

Australian textbook rental startup Zookal will begin utilizing drones to make its deliveries in Australia next year, with ambitions of bringing the unique, unmanned delivery method to U.S. customers by 2015.

The company says this marks the first commercial use of fully automated drones worldwide. It will fulfill deliveries in Sydney using six drones to start, dropping off textbook purchases at an outdoor location of the customer’s choosing. To wipe away any potential privacy or surveillance fears, the drones aren’t equipped with cameras.

Instead, built-in anti-collision technology keeps them clear of trees, buildings, birds, and other potential obstacles.

You can read the rest here:

http://www.cnn.com/2013/10/18/tech/innovation/zookal-will-deliver-textbooks-using-drones/