Access the Business Officer Magazine menu by clicking or touching here.
Business Officer Magazine logo, click or touch this logo to return to the homepageClick or touch the Business Officer Magazine logo to return to the homepage.
Get back to the Business Officer Magazine homepage by clicking the logo.

What’s Next for Text?

February 2013

By Sandra R. Sabo

Learn More About Offline Reading

As textbooks morph into digitized, customized, and even open source products, the campus bookstore now has a different role to play.

In 2007, someone assured Jeff Nelson that electronic textbooks would replace print ones within five years.  

“Obviously, that hasn’t happened,” says Nelson, director of bookstores and card services at Bowling Green State University (BGSU) in Ohio. “While e-textbooks are more available than they used to be, they’re not yet all ready for prime time in terms of meeting students’ needs.

“Yet,” he continues, “that’s not an excuse for a university not to be involved in e-textbooks. It’s just a matter of time until digital content overtakes print.”

Within the next two to four years, for example, many of the students entering college will have used digital textbooks and laptop computers in their high school classrooms. Soon after, higher education will begin welcoming students who have been tapping away on tablets since elementary school. Accessing and manipulating electronic content will be second nature to those digital natives. 

“Over the next 10 years, we’ll see a dramatic transformation on college campuses because the students won’t know how to learn under the traditional print models,” predicts Mark Nelson, chief information officer for the National Association of College Stores (NACS). “If you hand those students a printed textbook, they’d probably say, ‘What the heck is this?’”

Many Models

According to NACS, four of the 10 bestselling college course material products in 2010 were in a digital format. “For the three top textbook publishers, 30 percent of their revenue now comes from digital textbooks or course materials, and at least one of those publishers projects that digital products will represent more than half its revenue by 2015,” notes Nelson.  

What form those digital products will ultimately take, however, remains anyone’s guess. While acknowledging the inevitability of digital content, higher education institutions have not yet seen a dominant model emerge. They continue to experiment with various ways of developing, enhancing, delivering—and charging for—that content. 

In 2011, for example, the Ohio Board of Regents launched an e-text initiative with FlatWorld Knowledge. Instructors are free to modify and update the textbook publisher’s peer-reviewed material to fit their syllabus and match their student learning objectives.  

“The chancellor wanted to know why our students should have to pay $140 for an algebra textbook, for example, when a free online alternative and other affordable options were available,” explains Darlene McCoy, director of digital initiatives for the Ohio Board of Regents, whose research suggests that about 30 percent of students
do not buy their assigned textbooks. “The affordability of textbooks really affects
completion—especially at community colleges—so we wanted to offer less-expensive learning materials that students could use in the format they prefer.” 

For its pilot project, the Ohio Board of Regents purchased seat licenses that enabled 1,100 undergraduates at five institutions to access digital learning materials, without cost, for a variety of core courses. Students could view PDF versions of the textbooks online via laptops or PCs; download the content to a more portable tablet, e-reader, or smartphone; and, for $35, purchase a printed copy. In 2012, Ohio expanded the digital delivery concept to its entire system of 14 four-year schools and 23 community colleges; approximately 7,000 students are taking advantage of a FlatWorld product this academic year. (In January 2013, FlatWorld Knowledge discontinued free access to its online textbooks.)

According to Ohio’s research, about 80 percent of the students in the pilot program found the electronic content just as or more engaging than a traditional textbook. As a result, says McCoy, “We’re now talking with all major publishers to provide textbook delivery models that bring costs down for students.” 

Brad Wheeler has been having similar conversations with publishers since 2009. The vice president for information technology and chief information officer for Indiana University (IU), Wheeler took a page from the software marketplace and applied it to textbook publishing.  

“We have long negotiated volume licensing deals with Microsoft and Adobe, where we buy universitywide and give our students unmetered access to all that software,” he explains. “We believed that a volume-buying arrangement, using the university’s size and scale to obtain a better deal for our students, could be used for digital content.” 

Partnering with Courseload—an e-reader software company that serves as the intermediary between universities and several publishers—IU ran a five-semester pilot to study increased use of e-textbooks with reduced costs to students. Initially, the university’s IT department, together with some deans, subsidized trials of early digital textbooks, at no cost to students. By fall 2011, those pilots enabled IU to roll out universitywide policies and contracts so that faculty could choose to opt-in to the e-textbook deals. 

To address publishers’ concerns about digital piracy and online sharing of texts, IU does not allow students to opt out. If a professor requires an e-textbook, then every student who registers for that course section is charged, via bursar billing, for the content and e-reader platform that are integrated with the learning management system. Publishers receive 100 percent sell-through to every student, in exchange for highly advantageous pricing for students.

“Essentially, we moved the tollbooth away from the retail counter by making the e-text fee much like a lab fee. It’s cheaper for the university to buy things in bulk—in this case, content—and then recover the costs through an e-text fee that passes the savings to students,” Wheeler says. “It reduces the cost of attendance and ensures that every student has essential course materials.”

IU selected the net cost of ownership as one of its guiding principles for the pilot project. Specifically, a digital textbook should not cost any more than a print textbook that an IU student had purchased used and later sold back. Based on net ownership, IU estimates students using e-textbooks save an average of $25 per book or online supplement. The savings can be substantial in courses with many materials; when one MBA course moved to all-digital content, says Wheeler, each student saved half of the usual $720 cost for printed textbooks. 

Testing the Concept

Last spring, intrigued by Indiana’s foray into digital content, five other universities decided to test the concept on a larger scale. Rather than negotiate individual contracts, the institutions turned to Internet2, a nonprofit technology consortium, to serve as a liaison with publishers and e-reader software companies.   

One member of that group—University of Wisconsin–Madison—has also participated in the second and third pilot groups jointly sponsored by Internet2 and EDUCAUSE, the nonprofit association for IT leaders in higher education. For each pilot, UW–Madison tested a slightly different combination of publishers, software, and courses. This spring, for example, the university for the first time is using the CourseSmart platform—developed and owned by several large textbook publishers—to deliver content through its course management system. It also recruited about 100 students, all of whom agreed to use e-textbooks exclusively for all of their courses.

“This model will include a wide variety of textbooks and concentrate the students’ experience on electronic delivery,” says Bruce Maas, chief information officer and vice provost for information technology. “By experimenting with e-textbooks in various ways, we can determine the impact they may ultimately have on teaching and learning as well as on costs.”

UW–Madison has covered the costs of its e-textbook initiatives through the instructional technology fee already paid by each student. That model, however, may not fly at institutions that have traditionally backed away from charging additional student fees—or require state regents’ approval to do so.

Just ask Terry Simpkins, director of research and collection services at Middlebury College in Vermont. “At $55,000 a year to attend here, the idea of charging a fee wouldn’t go over too well,” he observes. Middlebury, one of the few private colleges involved in the Internet2/EDUCAUSE pilot last fall, had 16 faculty members and 492 students experiment with e-textbooks for one semester. The college funded the $20,000 participation fee through its library and information services budget.  

Simpkins reports that Middlebury paid $40.65 per student for textbooks which, in their printed form, could cost as much as $150 to $200. He adds, “Of course, the pilot program may have nothing to do with the prices publishers will ultimately charge. And, because Middlebury owns its own bookstore, we will eventually have to address the bottom-line implications that e-textbooks have for revenue.” 

Simply put, what happens to a college bookstore—and an institution’s auxiliary services budget—when students no longer purchase printed textbooks? 

The Bookstore’s Role

George Masforroll, associate vice president of auxiliary services at Broward College, a community college in Florida, has given that question a lot of thought, and he doesn’t envision the end of the bookstore anytime soon. He says, “Often, we hear replacement theory—that digital textbooks will replace print textbooks. In some situations, that will definitely happen. In others, digital modules and assessments will probably have a print component as well.” It’s not an either/or proposition but rather an and/or choice.

Masforroll favors the analogy of an old-fashioned livery stable, where travelers could have their horses fed, watered, shod, and quartered. As cars overtook horses as the main form of transportation, livery stables became service stations and then convenience stores, all to meet travelers’ needs. Similarly, college stores have already morphed into selling technology, computer repair, print-
on-demand, and shipping services—all to meet students’ needs.

“Provided they continue to evolve and diversify, college stores will be able to find perfect solutions for students because the common denominator is always education,” Masforroll believes. 

In the world of digital content delivery, the college store can play a starring role by:

Educating administrators. Much of college life can be accomplished online—applying for admission, registering for classes, paying tuition—so it’s not a stretch to envision students accessing Web-based textbooks. Plus, e-books have proved popular fare in collegiate libraries and retail establishments. But despite what some administrators may think, those technological successes don’t automatically translate into high rates of e-textbook acceptance among students. 

“Many e-textbooks are just digital PDFs of printed books, and students have shown little enthusiasm for that,” says Bob Crabb, director of the University of Minnesota bookstores. For the last four years, Minnesota has offered digital versions of textbooks at a 45 percent savings over the new print price. But few students have opted for the cheaper digital versions, which represent only 1.5 percent of the university’s textbook sales. 

“Recreational reading on electronic devices is rather high, but there’s a big difference between novels and textbooks,” observes Masforroll. “You don’t necessarily take notes while reading novels, and they’re not full of dense theories and concepts like textbooks are.” 

Another common misperception, notes Mark Nelson of NACS, is that a digital product is far less expensive than its print counterpart—perhaps because publishers have historically used print sales to subsidize their digital products. Administrators who assume e-textbooks will always be more affordable for students might be in for a surprise. 

“Everybody thinks that the costs of printing and distributing a textbook total 50 percent or better than its price when, in fact, those costs are only about 6 percent,” says Nelson. He notes that content creation, fact checking, and peer reviewing represent the bulk of a textbook’s costs.

Nelson continues, “With a digital textbook, you still have to do those things, so pricing it at 40 or 50 percent of the cost of a traditional textbook is not sustainable. Already with digital trade books, you’re seeing prices much closer to print than they used to be.” 

Assisting faculty. BGSU’s Jeff Nelson observes that faculty appreciate guidance and direction on the costs, advantages, and disadvantages of various content options. For instance, Open Educational Resources (OER)—free content typically published under a Creative Commons license—are usually peer-reviewed and can be accessed, modified, copied, and updated by the faculty using them. “The bookstore doesn’t decide which accounting textbook is the best—faculty are the experts on that,” he says. “But the bookstore has expertise on how adopting a particular type of book will affect the student.”

In addition, through focus groups, webinars, and other training events, college stores can help faculty feel comfortable using the features that take e-textbooks to the next level. These include tools such as annotations, highlighted passages, and updated content that a faculty member can quickly share with all students in a course. “Students tell us that what they value most about an e-textbook is having faculty use the collaborative capabilities—by adding notes, highlighting to draw attention to certain passages, and answering questions raised by other students,” says Brad Wheeler. 

Indiana University also encourages faculty to draw on open access materials to assemble digital course packs. Often, these customized supplements—including videos, articles, games, and quizzes—can be delivered through the same interface as an e-textbook, giving the students one access point to digital content via a variety of devices.     

Being the “genius bar” on campus. If students have issues with digital course materials, bookstores are already well-positioned to solve problems with devices and serve as the liaison with publishers: They’ve been doing both for years. In addition, says Mark Nelson, the college store can advance the institution’s mission “by helping a student find the right materials to work on his or her device, for a particular class, much like a reference librarian.”

This enhanced customer service role undoubtedly carries staffing implications. As Broward College’s George Masforroll notes, “This requires employees with certain skill sets—people who have at least a cursory understanding of the digital content and can communicate effectively with faculty, administration, and publishers.” 

Handling transactions. “College stores are already set up to take care of the little details that crop up in the print world as well as the electronic world,” believes Crabb. “If universities bypass the systems already in the bookstores, individual departments may be taking on a very heavy workload they may not be ready for.” The University of Minnesota bookstores, for example, work with hundreds of scholarship providers, billing them directly for any textbooks eligible under a particular scholarship’s terms. 

“Bookstores have proven to be good guardians of student information; not everyone is comfortable entrusting that data to a publisher,” adds Jeff Nelson. “We can also manage the payment process, whether through student accounts or financial aid.”  

Catch a Wave   

The current proliferation of mobile devices, software platforms, price points, and content—whether OER or copyrighted—has produced many approaches to e-textbook development and delivery and more than a little confusion.

“We’re seeing many moving parts right now, with no clear pathway to a prevailing model,” says Dana Voss, program manager for Internet2’s e-textbook trial. Internet2 just launched its third pilot in January and plans several more. 

A fluid environment having numerous players and approaches is a hallmark of the first wave of innovation, explains Mark Nelson of NACS. “Next, you’ll see the emergence of a dominant design as people start gravitating toward certain features or components across all the products. That’s the second wave of innovation, when the standard is set and a lot of players typically fall out of the market,” Nelson says. 

The third phase of innovation typically focuses on differentiation: how the remaining players make their products unique. When the e-textbook market reaches that point, Nelson believes today’s somewhat static products will have evolved into highly interactive course materials that include assessments tied to learning outcomes. 

In time, he says, e-textbooks will more closely resemble a software program than a printed book and will include videos, models, and homework problems in addition to text. The e-textbooks will communicate results to faculty members, who can tailor their next class to address the concepts or passages with which students struggled the most.

“Ultimately, the text will adapt to the particular student using it, leading to self-paced learning,” Nelson says. “As the students master a section or topic, the text will become more complex—just like a computer game in which you unlock progressively more difficult levels.”

Although many technological experts have tried, none has succeeded in predicting how long a particular wave of innovation will last before the next wave overtakes it. That’s why Middlebury College will continue experimenting with various approaches to e-textbooks.

“Right now, we know the format is shifting from print to digital,” says Simpkins. “Whether that also means a shift in mind-set—away from a linear and toward a more three-dimensional way of interacting with content—we don’t know. But the worst thing a school can do is pretend that none of this is happening. Looking at a change that is inevitable, even when it forces you to consider things you’d rather not, is better than ignoring a trend until you no longer have any power to shape it.”

SANDRA R. SABO, Mendota Heights, Minnesota, covers higher education business issues for Business Officer.

College stores can help faculty feel comfortable using the features that take e-textbooks to the next level. These include tools such as annotations, highlighted passages, and updated content.