It’s time for Apple to once again own the educational market. They owned it in most of the 80’s with Apple being synonymous with education until Dell and Gateway delivered prices that just couldn’t be refused. Department after department in at least higher education, went the way of the PC until all that was really left for Cupertino were the Arts and creative subjects. Computers were thought of as commodities with a Dell being as good as a Gateway and an Apple suddenly being an outlier.
Surely the commodity computers broke a lot more often, but like a garbage can or a filing cabinet, if one broke, it was easy to replace it with another just like it and even with a shorter life-span, the price just couldn’t be beat. Apple labs became fewer and support for Apple anything on campus waned. I was there to see it in higher education.
Now there is a new opportunity for Apple to take control of education once again. All the pieces are nearly in place, but what the picture of the completed jigsaw puzzle shows is not very clear. What we do know is that Kara Swisher of AllThingsD, announced a small Apple event that would take place sometime in late January. We just found out that it’ll be at the Guggenheim Museum on January 19th. This was picked up an eWeek post citing Clayton Morris who didn’t mention sources, but knew that the event will be about iTunes University and Apple in Education. Clayton was quoted as saying the event would be “small in size, but large in scope”.
We also know, courtesy of the Walter Isaacson book, that Steve Jobs had an abiding interest in education and viewed the textbook business as an $8 billion industry “ripe for digital destruction”. The biography went on to tell about Job’s meetings with Pearson and other textbook companies regarding potential partnerships.
A Paradigm Shift
Let’s not waste time talking about computers. They are so 20th century. Let’s just talk iPads, costs and problem solving. When it comes to the cost and maintenance of school books in higher education, anyone who has been through any sort of college or university knows that the cost of textbooks is egregious. It add hundreds of dollars (to be conservative) to the fixed cost of surviving a semester. Why is that? A major reason is that the print runs of textbooks are relatively small while the cost to print them are large. Most books require good paper to support complex graphics required for diagrams, pictures, etc., and have a limited shelf life since the average usefulness of a textbook is no more than a few years before a revision is released.
The Revision Cycle
When that revision hits the shelves, students can no longer sell back their textbooks to the school bookstore or online vendors that have popped up over the years. Teachers will not allow older versions of a book to be used in class because the information is changed and sometimes even contradicted. If you’re not one of those that keeps every book ever bought, in a word, you are screwed, being left with an ageing lemon. Next year new students can’t buy a used book and are forced to pay full price for the newest version. From personal experience I know this to be true in courses dealing with technology, curriculum development, modes of education, distance education, and modes of instruction. Other subjects may be different. The price of the new version might be $100 or higher. Is that a scam or what?
In talking to authors and publishers, it’s not as much of a scam as you might think. Small runs, distribution costs and limited shelf life raise the break even price, while books like the Isaacson biography of Steve Jobs is printed on cheap paper (I can’t believe how cheap and was glad I read it on an iPad), and ship, according to Amazon, enough copies that when stacked would be higher than Mount Everest and sell for what’s considered a reasonable price. Once low enough, since it’s a heavy book makes one question how a textbook publisher can get away with something a third the size for five times the cost. The per unit cost of a textbook is many times that of a bestseller. I don’t know any author who got rich writing a textbook and the profit margins on sales, though higher than best sellers are not nearly as high as you might think.
A Not So Modest Proposal
We have no idea what Apple will announce later this month, but here are some ideas that just might make some sense. In these proposals I am referring to iBooks, not eBooks or any other form of electronic books. The reason, at least in my head, for my proposal to work, is it requires the one click elegance of everything Apple. I think that downloading from A, changing the format to B and running it on C, would kill the concept. As in Apple’s successes, it just working is paramount to the success of the concept.
- Aggregate Publishers
Pearson is a good example since they control a good number of imprints that cover a wide variety of subject matter so we’ll use that as an example. Aggregate Pearson and a number of other major textbook publishers to be Apple partners (or something like that). Just as Mom and Pop grocery stores have turned into supermarkets and discount stores have morphed into Walmart, create a working arrangement between major publishers who will keep their autonomy (we don’t need no steekin’ monopoly lawsuits) but will agree to work under an equal compensation plan and working arrangement. This digital consortium will have no effect on their physical publication business, outside of to lessen it, since not all schools will go for this scheme.
- Create a Plan to Turn Books Into Digital Curriculum
Hire a textbook publisher who has been proven to know what they’re doing. I would propose Houghton Mifflin Harcourt whose HMH Fuse series of curricula for the iPad have proven to be wonderous and they have the data to back it up. Hire someone like HMH to work with non-digital publishers to turn big money making core curricula books into iPad apps. HMH or whomever would get an small override of all copies distributed. This will prevent everyone having to reinvent the wheel. We all know the virtue of a the Mac OS where every program has a File, Edit, etc., menubar and knowing one program means you know a good deal about all programs. HMH or whomever would just be involved with the technical parts. Ownership, distribution, marketing and everything else would, of course, remain with the initial publisher. The Fuse series is very media rich containing videos, programmed instruction, step-by-step quizzes that won’t let you progress until you’ve attained a level of proficiency, and so many good thing that I’d recommend downloading a free demo copy. Beware though that it’s big, taking up about 600 MB of your iPad space.
- Create a Degree Based Rental Marketing Plan and Sell it to Schools
If you think the above is hard, you ain’t seen nothin’ yet. A plan should be developed, something like a technology fee that most schools charge, but this would be a textbook fee. It would be paid per semester just like tuition and it would contain all the books required for all the courses offered for a degree. The amount should be the same regardless of the degree or the amount of books needed. The beauty part is that the sticker shock of buying textbooks each semester will be dead since everyone will know how much this will cost before the fact. The price may go up annually but that would be pre-determined so there will be no surprises. It can’t be $150 one year and $1500 another year. As a parent who paid for two children’s degrees through Masters programs, this would be great news. The cost of a current iPad would be embedded into the charge so that it’s fully paid for from the textbook fee. A partial refund would need to be made if the student transfers schools.
Do not force students to buy the program. If they wish, they can buy the books (at higher prices than normal since economies of scale go both ways and less copies will be printed), and all the digital components would be available on a password protected web site.
- Be Prepared to Take a Temporary Loss
Selling an idea as revolutionary as this is going to ruffle a lot of feathers. At first we would expect a moderate number of tech saavy schools to try it out with the great majority of schools waiting on the sideline hoping for it to fail. Be prepared to amortize the research and development costs over a longer period of time than most technology products. Something like this is not going to be an overnight hit, but it’s quite possible for it to be a long term home run. So don’t sell the plan for absurd amounts of money. Sell it for considerably less than the comparative cost of buying the textbooks.
- Don’t Hurt the Authors but Do Take Advantage of the Ability to React Quickly
When a textbook is revised, the author gets paid for it. This is usually a lump amount paid on completion of the revision. Technology based books are revised more often than Art History books which makes sense. Compensation plans should be adjusted as well. It would be different for each book and subject but the idea would go something like this:
- Decide how often a book is revised over a four year period
- Figure how much is paid to the author for each revision
- Decide what the optimum time period for a revision would be if publishing were taken out of the equation
- Divide the cost paid to the author for each full revision by the optimum number of revisions
- Have the author provide the optimum number of small revisions along with the teachers manual
- Pay the author quarterly so that they get the same amount of money as doing a rull revision.
- Provide ongoing technical assistance either by training or in-house coding to prevent the author from doing work for which he or she has not been paid.
- Watch the Sparks Fly
Schools really aren’t major fans of change. To some faculty and administration this will be anathema, to some publishers it will be killing the fatted calf, to other it will be the best thing since the iPod. It really depends upon how ingrained one is in their view of the world and politically what it means to them in terms of power. If it goes, it will have Apple turning over another field to something that just makes sense. If successful it can make make students, faculty, authors, parents and publishers happy.
If it doesn’t work, we’re no better off than we are now.
If this sounds intriquing please write about it in the comments. We have some less formed thoughts of what can be done with the K-12 market.