According to the National Association of College Stores the average price for a new textbook in 2012 was $68 and the revenue generated for U.S. College stores for fiscal 2011/2012 totaled $10.45 billion — most of that from textbook sales or rentals. A Forrester Research study quoted in the New York Times pegs the total textbook market for 2010 (that includes college as well as high school as well) at $8 billion in the U.S. alone, and at that time digital sales had a measly 2.8% share, leaving plenty of room for growth.
Speaking of textbook rentals, Google is getting into that business as well (at least on the digital front). Amazon and B&N also rent digital e-textbooks, but Apple has stayed away from that model so far.
The market is sizable and destined to grow rapidly thanks to increasing college enrollment and by ever-growing tablet ownership rates, which means the technology giants don’t have the market to themselves. Kno is one of the early digital textbook sellers, offering some 200,000 digital textbook titles for a range of hardware platforms, while CourseSmart claims it has the world’s largest selection of e-textbooks.
All of these digital options — from Apple’s iBookstore to Kno and Google Play — have agreements in place with the actual textbook publishers, big companies like McGraw-Hill Education. All that is except for Boundless, an e-textbook seller trying to shake up the market by offering free e-textbook “alternatives” and selling $19.99 interactive versions, both based on royalty-free open source material. Boundless is currently being sued by a who’s who of the textbook publishing world.
Google Play’s e-textbook selection might not be up to the competition this year of operation, but you can bet the company will show its usual relentless determination to improve. Google Play e-textbooks are stored in the cloud and accessible from a huge range of devices — including Apple’s — and naturally, Google search is a featured option. It claims its digital offerings can save students up to 80% off the purchase price of buying a new textbook at their college bookstore.
While Apple, Amazon, B&N and the rest of the e-textbook players will be watching Google warily, the area where the growing transition to digital is likely to be most strongly felt is college bookstores. These retailers will soon need to begin filling their shelves with more sweatshirts, hats, tablets and something other than piles of textbooks.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.