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Apple Announces Efforts to ‘Reinvent’ Textbooks
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Posted On January 26, 2012
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In an effort to “reinvent” textbooks, Apple unveiled a suite of tools and resources geared to the K-12 education market on Jan. 19 at New York's Guggenheim Museum . In the first major product announcement since the passing of Steve Jobs, the new products were introduced by Philip Schiller, Apple senior vice president of Worldwide Marketing. “With 1.5 million iPads already in use in education institutions, including over 1,000 one-to-one deployments, iPad is rapidly being adopted by schools across the U.S. and around the world,” he noted.

The trio of products launched were the following.

  • iBooks 2 for iPad app is a free download from the App Store that allows users to view the etextbooks as “fullscreen books, interactive 3D objects, diagrams, videos and photos; the iBooks 2 app will let students learn about the solar system or the physics of a skyscraper with amazing new interactive textbooks that come to life with just a tap or swipe of the finger.”
  • iBooks Author, is a free authoring tool that allows “anyone with a Mac ... [to] create stunning iBooks textbooks.”
  • An “all-new iTunes U app,” intends to give “educators and students everything they need on their iPad, iPhone, and iPod Touch to teach and take entire courses.” Apple’s Eddy Cue noted that the University of Paris, UC Berkeley, and UCLA were already using iTunes U to supplement their curricular offerings.

IBISWorld analyst Mary Nanfelt tells NewsBreaks that “Apple has a strong future for ebook sales. Many consumers are used to accessing iTunes regularly to purchase movies and music and are likely to at least browse ebooks while they’re already on the site, and with the rising popularity of the iPhone and iPad, the traffic to iTunes will only increase.”

Apple also announced agreements with three major textbook publishers. Houghton Mifflin Harcourt, McGraw-Hill, and Pearson signed on to “deliver educational titles on the iBookstore with most priced at $14.99 or less.” These agreements appear to be, at this point, more an opportunity for testing the apps marketplace for educational release, with all three companies fully intending to continue to create and sell educational books through traditional channels as well.

“I say ‘way to go’ to Apple for kick-starting the eBook education revolution,” notes Dan Pacheco, CEO of BookBrewer, a multiplatform publishing company. “But to educators and publishers I say ‘caveat emptor’—keep your eBook options open.”

The K-12 Marketplace

The Association of American Publishers notes that, for the most recently available data, “2010 net sales revenue for this category is $5.51 Billion. The category showed a -12.4% decline from 2008-2009 but rebounded in 2009-2010 with a +7.1% increase. This translates to a change in net sales value over the three-year period of -6.2%.” Schools have been hit by recent economic downturns, affecting their ability to expand or increase monies for resources and impacting growth.

A report by digital textbook provider Xplana published last year, projected etextbooks would take 6% of the market in 2012 and 44% by 2017. “School and college textbooks account for an estimated 32% of industry revenue,” notes Nanfelt.

Apple is chasing a global school and college textbook market that publishing analysts at Outsell expect to reach $19.4 billion in 2013. The digital share of that market will jump from 3.4% in 2010 to 18.3% next year, they forecast.

The U.S. Department of Education estimates that 55.4 million K-12 students are currently enrolled in public and private schools in the U.S.. The process of selecting textbooks for public schools (and many parochial) are approved by either local school boards or even state-wide selections groups. To assume that teachers or school districts will move from an embedded system of textbook selection to the Apps store is a bit naive—just as thinking that anyone (after all, the software is free) can be a successful textbook author at the price point of under $15. Schools also have to be very concerned with ubiquitous access to content and ADA compliance—issues yet to be addressed.

Apple’s Continuing Battles for Ebook Marketshare

In the 7 years that Apple has offered music through its iTunes store, an estimated 15 billion songs have been downloaded to the more than 200 million iOS devices. In the 3 years of the Apps store, an estimated 14 billion apps have been downloaded. In addition to Google, Amazon, and other ebook and media providers, Apple has its own share of issues with which to contend. Apple has also worked through the courts to fight competitors and battle to protect their intellectual property and challenges to their practices.

The European Commission, some states attorneys general, and the U.S. Department of Justice are actively investigating Apple’s potential collusion with the Big Six book publishers to set ebook pricing. The cases may make it into court this year. Apple also lost a bid to ban the sales of Samsung Galaxy Tab 10.1) smartphones in a effort to legally define what aspects of device design infringe on Apple’s intellectual property rights.

Increased competition is inevitable since it’s impossible to believe that Google, Amazon, and others aren’t planning their own new introductions for this market sector.

Publishers’ Perspectives

Joe Esposito, management consultant and former publishing CEO and blogger at the Scholarly Kitchen, notes that, “as publishers, you really have to consider that there might be a really large-scale acquisition that might lead to a large, structural change to the entire industry. But you also have to think in terms of why people like your products. I think what’s happening now is that these transformations are resulting in publishers becoming more aware of the distinctiveness of their own products. They are no longer in a position to muscle their way into some market, they have to succeed on the strength of their content, and that’s a big change. There are just too many options out there.”

Smashwords and Amazon’s CreateSpace are two examples of services offering support for self-publishing or other types of nontraditional publishing.

Data Conversion Laboratory surveyed publishers recently and found that 63% planned to publish an ebook this year. DCL president and CEO Mark Gross tells NewsBreaks that, “as far as I can tell, everyone is moving to ebooks; except for some very specialized areas, no publisher will be able to stay behind. While today it’s still a niche, in another year or two, it will no longer be a niche area; every type of publisher is either experimenting, or actually is already in some level of volume production.”

“Apple has been a critical catalyst in opening up the book market, similar to what they did for the music industry,” Gross continues. “But the difference is that in book publishing, there are a lot of big and creative players, so it’s hard to predict where it will all fall out, and I would guess there’s room for even more players.”

“We must now figure out how to remain true to that mission while broadening our scope from creators of books to creators of content in multiple formats,” notes Andrea Fleck-Nisbet, digital publishing director at Workman Publishing. “We must continue to produce the best content possible while investing in the digital business in service of content and platforms yet to come.”

“E-book platforms allow more authors to self publish and retain a larger proportion of value chain for themselves,” Nanfelt explains, “which is a risk for publishing companies. Although growth in e-books is expected to promote growth in the total book market, it could pressure publishers to share a higher proportion of their revenue with authors or platform providers. This could affect publishers’ profit margins.” Pricing will be interesting using the iTunes and iBook platforms. Apps and ebooks are very fundamentally different types of products, requiring separate consideration when it comes to pricing and terms of use.

“As for overall revenues,” Hyperion CEO Ellen Archer explains, “let’s just say, as we move forward, we’re going to have to create new models. This business model, while it’s never been great, is broken; 2012 is going to be about finding new business models.”

Disintermediating Education

In his book, Steve Jobs, Walter Isaacson wrote, “Jobs believed that all books should be digital and interactive, tailored to each student and providing feedback in real time.” In the book, Jobs is reported to having called the current textbook approval system “corrupt,” and expressed his desire to transform it. At the press conference, Schiller was quick to credit these new product initiatives to the work and vision of Jobs.

In his lifetime, Jobs was able to lead in the transformation of many key industries or product areas: Animated films (through Pixar), music distribution and listening (through iTunes and iPods), computers (through the Macintosh line), phones (with the sleek iPhone), tablet computers (with iPad), and retail marketing (with the success of the Apps store for books and other types of media). However, with their effort to disintermediate K-12 education, Jobs and Apple may have entered into an arena beyond their depth, in which sleek designs and coolness factors are outweighed by other considerations.

Even with well-qualified authors and scientific findings on your side, many textbooks are still found unacceptable to local standards or controversial due to subject matter (such as evolution). Into this highly charged, highly regulated arena, the cost of the iPad (just under $500 each) makes it difficult to imagine that schools, let alone parents, could afford these devices especially in a country in which one of every five children lives in poverty today.

Pearson, McGraw-Hill, and Houghton Mifflin Harcourt are all major, traditional educational publishers, willing to dabble in this new approach and publishing platform. And, why not? They have little to lose. For non-essential educational materials, intended to supplement classroom work or to allow for self-education, the Apps approach holds promise. And priced at $14.99 or less, these should attract a good business—but this is still no challenge to the educational publishing industry. McGraw-Hill’s own STEM marketing VP, Lisa O'Masta was quoted as saying that “the common myth is that anybody can create quality content and curriculum; the reality is there’s a lot that goes into what curriculum is created.”

Open Access Versus Closed Architecture

Apple’s approach since the early days of the Macintosh has been a closed, proprietary architecture. Something as universal as learning and education would seem to demand an open standard. For ebooks, we have that with HTML 5 and EPUB 3. Although Apple is a member of the International Digital Publishing Forum, which controls the EPUB standards, zdnet.com’s Ed Bott notes that “the new iBooks 2.0 format adds CSS extensions that are not documented as part of the W3C standard. It uses a closed, proprietary Apple XML namespace. The experts I’ve consulted think it deliberately breaks the open standard.” 

Closer examination of Apple’s iBooks Author license agreement also betrays very restrictive terms for author-generated content. For example, “the agreement restricts paid distribution of ‘works’ created with the software to the iBookstore only.”  And for schools, “Windows still commands at least 85 percent of the global marketshare, and the fact that PCs are still cheap and Mac OS X doesn’t run on PCs, it cuts out a hefty portion of Windows-running schools,” notes zdnet’s Zack Whittaker.

“Cynically,” Bott concludes, “Apple is positioning this authoring tool and the new format as the savior of K-12 education. All school districts have to do is buy one iPad for every student and buy textbooks through the iTunes Store, and their problems are solved. Wrapping themselves in the education flag is a transparent attempt to win praise and deflect criticism.” 

Pacheco tells NewsBreaks that the fragile nature of the devices will cause schools to have to divert funds to cover the iPads costs, and then: “The next step will be that the iPads will only be available in a ‘safe’ place, such as a computer lab. The kids’ normally freeform reading time with printed books will shift to a very controlled experience where they sit at desks in a lab and carefully swipe through pages on an iPad—all while budget-conscious computer teachers nervously watch them to make sure they don’t destroy the devices.”

Looking for Change

Ohio State University’s Steve Acker, research director of eTextOhio Project tells NewsBreaks that “the major trend in textbooks that I can ascertain is continuing and growing dissatisfaction with the current model. This applies to all involved in the distribution system—the author, publisher, bookstore, institution, faculty, students. We would hope that all innovative and powerful tools/content creators maintain momentum toward permitting eReaders/browsers to be capable of ingesting and presenting EPUB content. Apple’s new tool doesn’t do this in its current form. This could be a purposeful market lock-out, or a test environment for innovation in which EPUB3 ultimately embraces the file format extensions that give iAuthor its power. Time will tell, but I’d bet on Open Standards winning out over proprietary when the adoption decision is at the group/institution level rather than the individual.”

In the first 3 days after the announcement, the iBooks 2 saw 350,000 downloads, and iBooks Author had 90,000—which is a good indicator of interest in Apple’s offerings. However, at least for the authoring component, there has been at least as much criticism of the licensing structure as there are plaudits for the quality of the product.

OA & Other Options

Textbooks are neither lightweight nor cheap. Bowker’s PubTrack data for 2010 found that the average college textbook cost $104.14, an increase of more than 24% since the 2005 average of $83.73. However worthy the Apple may be, there are many other approaches to improving textbooks and learning today. Change is taking place in two significant areas of the textbook and education marketplace: Open Access and open courseware.

Major digital textbook providers in the U.S. today include CafeScribe, CourseSmart, Vitalsource/Ingram, and Xplana. Perhaps even more significant is the growing interest in Open Access etextbooks, with leadership from Flat World Knowledge a publisher of college-level open textbooks and educational supplement, Conexions, Open Access Textbooks Project, Wikibooks open-content textbooks, the K-12 California Open Source Textbook Project, and CK-12 Foundation.

Open, collaborative course development, spurred largely by higher education, includes the MIT spinoff OpenCourseWare Consortium, Carnegie Mellon University’s Open Learning Initiative, MERLOT, “a leading edge, user-centered, collection of peer reviewed higher education, online learning materials”—these are key options. So, efforts to change many aspects of education—from preschool through continuing adult education—are underway, with or without Apple’s involvement.

Patrick Martin, “the Motley Fool,” notes that “at the bare minimum, the technology that replaces textbooks must work across multiple platforms and be capable of running on the cheapest hardware. Anything short of that will just be another thing that only more prosperous parents can purchase in hopes of giving their children a leg up. There’s nothing wrong with that, but it’s not a revolution.”

Evolution or Revolution?

“The phrase which keeps coming up in my mind about ebooks,” notes Faber & Faber’s Henry Volans, “is evolution; I have absolute certainty that we have not reached anything close to the evolutionary ideal of the ebook...I find it absolutely inconceivable that the book can’t evolve and change and grow.”

For Apple to truly be seen as a major supplier of K-12 educational content, it needs to adapt its products and expectations to the standards and norms of the industry. To serve needs of users, open up to whatever format/standard/computer system the users want instead of controlling this. Instead of making licensing so restrictive and controlling, become the cloud-based hub for innovative learning and teaching. Instead of relying on the current, fragile iPad units—even with high school students, who tend to drop their backpacks on floors, in lockers, in the backseats of cars with a bang—give them a ruggedized version that might last longer than until the next iteration of the iPad. Schools are cash-strapped. If Apple really wants to jump-start the adoption of iPads, bring the price down—we are in a recession after all. To really get this off the ground, announce this at a major education conference or publishers confab, not at the Guggenheim, which reinforces the coolness image of Apple, but doesn’t translate directly to the core audience of these initiatives.

For a company that is reportedly sitting on a nest egg of nearly $100 billion cash, is today’s largest technology company by market value in the world, and with a market value estimated at $400 billion, many were less than impressed. “I think that the announcement does more to reinvent business models and practices than it does to reinvent textbooks,” Outsell’s Kate Worlock explains to NewsBreaks. “The new iBook 2 textbooks, while impressive, aren’t terribly different to something you’d see from Inkling or in Nature Education’s new Principles of Biology. Of course, iBooks 2 focuses more on K-12, so it’s new for that market, but not revolutionary.”

Is this a good deal for authors or publisher partners? “I don't think it’s a good deal, however, for either potential authors or educators/students. The degree of control which Apple expects to be able to impose on the market will be stifling, particularly at a time when schools and individuals are struggling financially,” Worlock continues. “I think the authoring tool will help the open textbook movement in one way, in that it provides a free and very easy to use platform to create extremely professional products. How easy that content will then be to share remains an issue. I think that all of these products are competing now, with each other and with all of the free content which is available online. However, from an educator’s perspective, what’s needed is (a) a guarantee of quality, and (b) the ability to connect textbook content with other activities. Usability will be a key platform on which these products compete.”

The winners in all of this are readers, potential ebook authors, publishers, and others. Apple has, in a sense, legitimized ebooks and elevated the format and created a buzz throughout the industry, and brought in additional players into the mix. Ultralight laptops may find a role here as well, since a lot of education involves students developing more than just point and swipe operations, but actual reading, writing, and other skills. All of these wonderful new technologies should be giving everyone options, alternative models, and room for true innovation.

Writing in Nature on the death of Steve Jobs, Tim O'Reilly noted that aesthetics was “key to Jobs’s marketing genius. U.S. art critic Dave Hickey once said that when products become commodities, as personal computers had become, they become ‘art markets’ in which products are sold not on the basis of what they do but what they mean.” Cachet may work for individuals, but for cash-strapped schools, Apple’s products need to provide a whole lot more in terms of performance and pricing. Time will tell.


Nancy K. Herther is American studies, anthropology, Asian American studies, and sociology librarian at the University of Minnesota Libraries, Twin Cities campus.

Email Nancy K. Herther
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Comments Add A Comment
Posted By Mike Jensen1/27/2012 5:38:11 PM

This is the best article I've seen on this yet. Apple's plans don't make a lot of sense. Maybe they should have called it reinventing educational materials and not textbooks. I haven't read this before, but I'll check back again. Thanks!

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