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Apple and Textbooks: A Second Look

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Despite promises of a “digital destruction” of the textbook market, Apple’s actual iBooks announcements raise more questions than they answer. Now that the dust has settled, it’s time for a deeper look.

On January 19, Apple held an “education event” where they announced a new version of iBooks, a new set of tools for creating digital textbooks (iBooks Author), and an expansion of their iTunes U program. Video of the announcement can be found here. Joe Esposito took a first look that day, and rightly suggested that despite the high-minded statements about education, this was really about selling more iPads.

Since then, we’ve learned more about Apple’s offerings here and new questions have been raised about Apple’s strategy, and the effect this may or may not have on the publishing industry.

Is Apple Intent on Becoming A Publisher?

Kent Anderson recently suggested that Apple and Amazon were on their way to becoming publishers. While I think he’s right regarding Amazon, I’m not so sure about Apple. Amazon and Apple have very different business models. One is a reseller of products and bases its business on a huge quantity of low margin sales (combined with a superb level of service and convenience). The other is a manufacturer of products, and the business is, as it has always been for Apple, selling high-margin electronic devices.

While Amazon moves ever closer to becoming a product manufacturer, in this case a publisher, providing curation and some of the services offered by publishers, Apple instead views content as a means to sell more devices. That’s the reason why, despite the success of iTunes, that Apple has not become a music label or a movie studio. Similarly, it doesn’t make sense for them to take on content creation for books. One can’t really argue with their strategy, given that Apple’s recent Q1 profit alone was $3 billion more than Hollywood’s gross box office receipts for all of 2011. Really, why would Apple want to move into such a low margin business as book publishing?

What About That Dreaded EULA?

Once people got their hands on iBooks Author, the End User License Agreement (EULA) raised quite a few hackles, particularly this section:

IMPORTANT NOTE:
If you charge a fee for any book or other work you generate using this software (a “Work”), you may only sell or distribute such Work through Apple (e.g., through the iBookstore) and such distribution will be subject to a separate agreement with Apple.

Essentially, if you use Apple’s tools to create a textbook, you either have to give it away at no cost, or sell it exclusively through Apple. Some claim this is unenforceable, and others suggest that it’s unnecessary, given that the files created are so proprietary that they couldn’t actually be used on any other platform.

Regardless, it’s disappointing and takes much of the luster off of Apple’s announcements. Apple is certainly within their rights to make this restriction, and there’s a business case to be made for doing so (it offers an advantage to Apple’s platform, hence more iPad sales). But the limits imposed limit the impact on education. If these sorts of textbooks are truly revolutionary (see below), and Apple really gives a damn about education, then why place limits on improving things?

Is K-12 Really the Appropriate Market?

Apple’s presentation focused exclusively on the K-12 market. This seems a bit odd, as the solutions offered here make immediate sense for college and graduate education and very difficult to apply in K-12. College students buy their own textbooks and given the high cost of those books, the additional expense of an iPad can readily be offset by lower electronic textbook prices. There are no school boards to go through, no tax funding to secure.  You’re selling direct to the student, which fits with Apple’s iBookstore’s reach. There are obvious reasons why Apple is targeting K-12 instead, but many obstacles to having much of an impact there.

The first reason is the size of the market. The K-12 textbook market is estimated at $8 billion annually, with some 50 million students in public schools in the US. If you’re going to aim high, you obviously want to appeal to the largest possible market.

Second, the math for textbook publishers works better here. McGraw Hill normally sells a high school textbook for $75 and the school usually uses it over the course of five years. With an iTextbook, you’d sell it for $15, but you’d sell a copy to every student each year. That results in the same overall $75 revenue for the same five year period.

It’s easy to get textbook manufacturers to sign on when you offer them a chance to lower prices but keep revenues even (it’s worth noting that McGraw-Hill sees $15 as a “pilot” price, while Apple insists it’s a permanent one). College students, however,  buy their textbooks once — they aren’t repurchasing them over the course of their education. So you’re only going to get one sale to replace your paper textbook sale, not 5. Which makes an 80% reduction in price much more difficult to put into sustainable practice and it’s likely Apple failed to get buy-in from publishers in this market.

As you go higher and higher in education, textbooks become niche products. Compare the number of 5th graders studying Biology to the number of college students taking a molecular genetics course to the number of graduate students taking a seminar on RNAi. The lower volumes mean higher prices are needed to cover the costs of creating a textbook for a high level specialized course.

And that’s a tougher message for Apple to sell — buy a $500 device, then buy digital textbooks at a slight discount (digital textbooks that you can’t resell by the way).

So it’s pretty clear why K-12 was the target here. But the reality of the situation presents some extremely tough hurdles. Even if you could somehow cut the price of an iPad in half, outfitting the 50 million students in public schools alone means spending $12.5 billion. And that’s just for the hardware and assumes no student loses or breaks their iPad, no support whatsoever is needed, no wifi costs, and no textbooks are purchased. Then there’s the harsh reality of the mundane world, things like the dearth of electrical outlets in schools.

Are eTextbooks Really Revolutionary Tools?

It’s not hard to market a panacea in academia these days.

We need to look behind the hype and try to better understand the nature of what’s being offered here. Is Apple really offering anything different than the CD-ROM of the 1990’s? Is this just a tablet-based version of Microsoft Encarta?

I have no doubt that new technologies can create useful tools for educational purposes. Cold Spring Harbor Laboratory’s DNA Learning Center does spectacular things in this vein. I worry though, that what we’ll mostly be seeing instead are half-hearted efforts, low-hanging fruit. Is “The Sun Also Rises” a more meaningful reading experience if you add in bull-fighting videos? Is “Breakfast of Champions” a better read with clips from the movie?

There’s likely a reason why so many Silicon Valley leaders send their children to schools where computers are banned from the classroom. In the early years of their education, children are learning how to navigate the real world. Don’t they have to learn how to use real-world objects before understanding skeuomorphed virtual versions of those same objects? If those designs are indeed usable because of nostalgia, don’t children need something to be nostalgic about?

Part of that real world navigation involves interacting with other human beings. The more we encourage them to interact via online social networks at an early age, the more we may be stunting their social development.

The notion that the internet is changing the way we think has caused an enormous level of debate. I take the position that yes, the way we read and think while using the internet is different than other ways of thinking, but it’s an additive skill. Learning to use Google hasn’t prevented me from reading a long novel or doing in-depth research. But those were skills I had already developed before I used the internet. We can clearly add the shallow skimming of the online world to an established ability to concentrate deeply, but can we do the reverse? Can a child raised on a diet of hopping from link to link, reading only aggregated summaries later learn directed deep concentration?

I don’t know the answer to that question, which is why I’m hesitant to assume these new technological tools will serve as the sole guiding force in education. Not being connected, not having lots of distractions, really losing oneself in a subject is an important part of learning. Let’s use technology in the appropriate places, rather than across the board to best suit a private company’s business model.

And I’ll leave the final word on whether electronic textbooks can solve all of education’s ills to Steve Jobs:

I used to think that technology could help education. I’ve probably spearheaded giving away more computer equipment to schools than anybody else on the planet. But I’ve had to come to the inevitable conclusion that the problem is not one that technology can hope to solve. What’s wrong with education cannot be fixed with technology. No amount of technology will make a dent.

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About David Crotty

I am a Senior Editor with Oxford University Press' journal publishing program. Prior to that I served as an Executive Editor at Cold Spring Harbor Laboratory Press, and was also the commissioning editor for their book publishing program. Many years ago, I was a research scientist, receiving my Ph.D. in Genetics & Development from Columbia University, and doing postdoctoral research in neural development at Caltech.

Discussion

23 thoughts on “Apple and Textbooks: A Second Look

  1. I see hard times for kids learning how to write, especially if Ipads become common for all schools.

    Posted by bibliopirate | Jan 31, 2012, 6:13 am
    • I write all the time on my iPad. Of course I do it by typing, not hand crafting letters. I seldom write by hand.

      Posted by David Wojick | Jan 31, 2012, 10:00 am
    • It’s “iPads.” Just correcting your writing.

      If you want a reassuring read about how much more writing kids and people of all ages are doing these days, “Txtng: The Gr8 Db8″ is well worth your time. You’ll realize that literacy goes well beyond cursive or passive reading.

      Posted by Kent Anderson | Jan 31, 2012, 10:22 am
      • But it does raise the question: if cursive is considered an obsolete skill, what will future signatures look like? Will we just replace them with a chip and PIN identifier? Excuse me sir, I’m a huge fan–could you type your name into my phone?

        Posted by David Crotty | Jan 31, 2012, 10:33 am
        • I remember learning cursive in 3rd grade. After 3rd grade I never used it again. Mostly because I just typed everything into a computer. But even when I wrote on paper tests and such mainly my teachers commented that they appreciated the block letters as they could actually read them. The only cursive text I have written in 3 decades is my signature (which is illegible scrawl that no one can read anyway). If I’ve managed to get by in a pre-iPad world without cursive I don’t think today’s kids will miss it much. Cursive was never a good idea and if it is still being taught, we could probably free up a class session a day for an entire year (minus 1 day to learn how to sign one’s name illegibly) and use that time to teach kids something more useful. Like Chinese.

          Posted by Michael Clarke | Feb 1, 2012, 3:21 pm
          • I’m thinking we substitute in some instruction in typography. Each child will design their own font, and that will replace signatures. They’ll all learn useful design skills and it will lead to a world without Comic Sans.

            Posted by David Crotty | Feb 1, 2012, 4:41 pm
  2. At the risk of ridicule I have to disagree with Steve Jobs. Not that I think that technology is the solution, for I agree with him there; it is not. Rather, I do not think there is anything “wrong with education.” This myth is the reason why the field is awash with proposed panaceas and tech quick fixes.

    The fact is that having one person explain something to another is an extremely efficient way to transmit knowledge. So is reading. The notion that we can suddenly leap over all of this and create a new way to learn is just a sign of the hyperbolic times we live in.

    Nor do I come to this position lightly. I recently spent 4 years, full time, studying K-12 science education, in order to create a search algorithm that estimates the concept-based grade level of scientific content. What actually happens in K-12 science education is actually rather amazing. See http://www.stemed.info. The topology of the underlying complexity of science education is breathtaking, yet we handle it well, all things considered. Note that people being people is not a limitation; it is the situation. Education is about 50 million people spending 12 to 20 years of their lives, working full time learning.

    But it is easy to think something is wrong, and easily improved, when we make something hard look so simple. Scientific publishers find themselves in the same boat of course, facing claims that publishing per se is now obsolete due to technology. It is all hype. There is nothing fundamentally wrong with education, just as with publishing, quite the contrary. But there are lots of opportunities for improvement.

    Posted by David Wojick | Jan 31, 2012, 7:13 am
  3. At the risk of publicly quoting a show tune, this whole initiative reeks of “The Think System”. The problem is that publishers may actually fall for it.

    Posted by meg white | Jan 31, 2012, 9:56 am
  4. Thanks for clarifying the Apple offer. By the way, I think Steve Jobs is also wrong about giving away computer equipment to schools. Perhaps this is only a UK perspective, but it is my experience that Apple have been expensive and therefore peripheral in schools, whereas Microsoft and the PC brigade have been generous and strategic.

    Posted by Duncan Enright | Jan 31, 2012, 10:51 am
    • Apple has a long history in the education market, dating back to the pre-Windows days. They’ve long offered educational discounts and steadily held on to a presence there, despite being relegated to a small minority of overall marketshare. Their share of the market is indeed stronger in the US than worldwide, so you may be right from your perspective.

      In 1996 they held an astonishing 41% of the market, though this dropped during Apple’s dark days:

      http://news.cnet.com/Apple-losing-education-share/2100-1001_3-208312.html

      By 2001 it was down to 26% of the US market (14% worldwide) but that still made them the top supplier in the market:

      https://www.macworld.com/article/18332/2001/07/appleeducation.html

      Note though that in recent years, growth in education has not kept up with growth in the home and business sectors.

      Posted by David Crotty | Jan 31, 2012, 11:14 am
  5. A couple of thoughts from your useful article:
    1) Apple only sell products that operate their fairly fabulous and streamlined software – software is authored content and the relationship to publishing software and what we might call traditional content is bound to get way more blurry – see burgeoning market for app’s…

    2) Using the term textbooks is a tad self-defeatist in terms of supporting your argument – anything that lives and breathes on an ipad is going to be more of a digital first product that presents ideas and attracts participation – providing many set paths to achieve goals etc – a textbook is a linear item largely and whilst this might be semantics i think it is psychologically important to not refer back to hardcopy formats when pointing at options for the digital future

    Posted by tom clark (@polkyth) | Jan 31, 2012, 11:15 am
    • Point number 2 is really important here, and gets at the “low hanging fruit” comment I made in the post. I do think there will be some really spectacular new learning tools developed, but they are likely to be a very small minority of what we see. I base this on the state of the eBook world so far, which seems entirely based on recreating print books on a screen. The simplistic approach toward trying something new results in a new version of the CD-ROM. And I agree that’s a non-starter.

      Posted by David Crotty | Jan 31, 2012, 11:20 am
  6. Thanks for the useful information and thoughtful commentary.

    Posted by Byron Laws | Jan 31, 2012, 11:28 am
  7. “Is Apple Intent on Becoming A Publisher?”
    Amazon certainly wants to become more than a distribution company and is making obvious moves become a publisher also. Amazon want to own the content, the route to market and the relationship with the customer but Apple don’t seem to want to pursue this route. Apple patently want to sell devices plus own the relationship with the customer via the iBookstore and iTunes but only so they can continue to sell more devices.

    Posted by Jane Tappuni Publishing Technology | Jan 31, 2012, 1:44 pm
  8. Is there something wrong with American and British education? I have no doubt that David W. is right in saying that amazing things happen in K-12 education. I also agree with him that it appears that education is awash with fads and quick fixes; many of which are no doubt counter-productive.

    However, Steve Jobs also has a point. Both Britain and the US rank highly in the amount of money spent per pupil internationally, yet American and British students only do moderately well in the PISA Scores. US 15 year-olds rank only 11th (in international rankings) and British students rank only 19th in reading skills. They do even worse in math (Britain 23 and the US 26). What is more, South Korea, Hong Kong and SIngapore achieve better results while spending far less money per pupil than either the US or Britain. It isn’t enough to look at our system. Our educational system will ultimately be judged on how it compares with other systems across the globe. Yes, great things happen in American and British schools but when you compare those results with schools elsewhere, there is certainly room for improvement.

    Steve Jobs’ answer was technology. He may in fact have a point. Here is an article from the Economist which recounts a pilot program in Riverside. CA http://www.economist.com/blogs/babbage/2012/01/future-teaching. In this pilot program (conducted by Houghton, not Apple) students using the new interactive iPad text books performed better than students using traditional Houghton textbooks. Is this the answer to America’s educational problems or is this just another quick fix or fad? It is hard to say. But I think the results of this pilot program are encouraging for Apple (most certainly) but also for students, teachers and society at large.

    And yes indeed, Apple’s interest is in selling more devices, I have no doubt of that. Apple is not being altruistic here. Their purpose is to make profits and not to altruistically improve American education. But how is Apple’s motive different from Houghton’s (or any other traditional publisher) desire to sell more books? As to whether or not Apple intends to become a publisher is beside the point. Whoever creates and owns the content is not important here. The point is, Apple is about to enter the educational market and no matter what you think about Apple, that development has the potential to have a large impact on the textbook publishing industry.

    Posted by Mark Danderson | Jan 31, 2012, 9:21 pm
    • I don’t think Apple is being held to a different standard than someone like Houghton–in fact, all I’ve suggested here is that they be held to the same standard. And Apple has long been a major player in the education market, this is not a new entry.

      Posted by David Crotty | Jan 31, 2012, 10:11 pm
    • Mark, I regard those international test scores as basically bogus, like using IQ tests to say which of two people is smarter, to 3 significant digits. Using these tests to conclude that there is something fundamentally wrong with US (or UK) education is a good case of running away with shaky statistics. Round off the numbers to one significant digit and the remaining differences can probably be explained by social factors, such as how much education is valued in the general population, which is largely independent of the education system. Note too that in the Jobs quote he is saying technology is not the answer, but I disagree that there is a problem to begin with.

      By the way, I am not saying there are amazing things going on in the technology sense, just that science education is amazingly complex, wherever it is taught. This is where I think the room for improvement lies, in helping students, teachers and parents deal with the complexity. Science is not simple, a fact that many publishing and teaching approaches avoid. Perhaps I will do a post on this. But the basic limitation is that people can only learn so much, so fast. Technology will not change that.

      Posted by David Wojick | Feb 1, 2012, 7:02 am
  9. Yes, you are right David, I should have said Apple was about to introduce a new use of its iPad in the educational market.

    Posted by Mark Danderson | Jan 31, 2012, 11:55 pm
  10. I’ve heard, and agree with, a couple of reservations about iPad as a publishing platform.

    Firstly iPad, like any backlit device, does not lend itself to lengthy reading sessions, because the glare from the screen makes it uncomfortable to read on for very long. When you add to this the size, weight and cost of the device, it seems unlikely that iPad will be the first choice for the voracious reader – which surely compromises its potential as a publishing platform. Yes journal readers use backlit screens, but we know that many print out papers that they wish to read in depth.

    Plus many parents are trying to reduce their children’s ‘screen time’. Reading, like music, sports clubs and the great outdoors, is seen as one of the antidotes to backlit screens. So there may be cultural resistance, as well as budgetary constraints, operating against iPads in classrooms.

    Taken together, these points surely cast doubt on the whole enterprise of iBooks in its current form.

    Posted by Estis Finisterre | Feb 3, 2012, 11:37 am
  11. First, I strongly recommend the book “The Shallows” by Nicholas Carr which includes powerful commentary on multimedia educational material.

    Second, the statement on the economics of college text books and the one time purchase issue ignores the fact that hard copy college text books are very often resold. Selling an e-book prevents students from reselling their text books and guarantees another sale the next year.

    Posted by Phil | Feb 10, 2012, 1:29 pm
    • The elimination of the used book market is indeed another reason why publishers may favor going to an electronic-only market.

      But I think the value to students of re-selling textbooks is often overlooked in plans for moving to an electronic textbook market. When given a choice between spending their parents’ money on an eBook that can’t be resold or a physical textbook that at the end of the semester can be turned into money for a case of beer, a night on the town or the latest videogame, one can easily see why students might prefer to stick with paper.

      Posted by David Crotty | Feb 10, 2012, 4:12 pm

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