Pearson Signals Major Shift From Print by Making All Textbook Updates...

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Pearson Signals Major Shift From Print by Making All Textbook Updates ‘Digital First’

By Tony Wan     Jul 15, 2019

Pearson Signals Major Shift From Print by Making All Textbook Updates ‘Digital First’

The biggest education company in the world is moving away from a production model that has been one of the main drivers in the rising cost of textbooks.

Today, Pearson announced it will adopt a “digital first” approach to updating its higher ed course materials, meaning that any revisions or changes to textbook content will happen first in the digital version. This new development process goes into effect next year, when “we will have a substantial number of titles that we will apply this new model to,” says Pearson CEO John Fallon. Eventually, all of the publisher’s 1,500 higher ed titles will follow suit over the next couple of years.

“Our product development will now be digital first, not print-led,” states Fallon. “Revisions and updates can now be made in real-time.”

This marks a significant departure from the traditional textbook product development cycle, in which titles are updated and reprinted about every two to three years. These changes usually incorporate new findings in a field of study, or reflect recent events.

But each new edition comes with a higher sticker price. And critics of this model say the frequency of updates are sometimes unnecessary, driven less by the need to update content and more by a desire to drive additional revenue (and make it harder for students to buy used textbooks instead). According to a study by U.S. Public Interest Research Group, each new edition of a textbook cost 12 percent more than the previous one. Today, college students on average spend more than $1,200 on books and materials, according to The College Board.

Moving to a digital-first update model will save Pearson on printing, packaging and other costs associated with making physical textbooks. “This enables us to offer prices that are highly competitive,” says Fallon. And focusing on digital makes the secondary textbook market even less attractive, since students have to buy access directly from Pearson to get course materials.

The average price for a Pearson digital textbook subscription for a semester is $40, according to the company. A bundle that includes access to its other online tools, including MyLab and Mastering, costs about $79.

But the company is not cutting the cord with print. “We live in a hybrid world, and we have to exist across both mediums,” says Fallon. He did not rule out the possibility that Pearson may still issue new print editions. “If we get to a point where it became clear that the print textbook was very out of sync with the digital product, then we will update the print version.”

The company did not specify a timeframe for how frequently it will print new editions. But any physical titles produced will only be available for rental. In fact, the company has already been shifting toward this model. About one-third of Pearson’s 1,500 print titles are currently only available for rent, and that will soon be the case for every physical textbook. The average cost for each rental is $60 per semester.

For Pearson, which has shed well-known print brands, K-12 assets and thousands of jobs this decade, this latest move marks another major step on its transition into a fully-digital education business. “Print will no longer drive our product development cycle,” Fallon says. “We can update the content more frequently, and students and faculty will be able to get the updates in real time.” He added that changes are unlikely to happen in the middle of an academic semester so as to not disrupt teaching.

Currently, the typical process for textbook updates involves going through every chapter and several rounds of edits and proofing. That can be a very time-consuming process, says Lisa Urry, a biology professor at Mills College in Oakland, Calif. She is also the lead author on two widely-used biology textbooks and has worked with Pearson since 2000.

Exact details for how the new digital-first revision process will work are still being ironed out. But she’s excited at the possibility that “instead of methodically marching through every chapter, we can analyze data accumulated from students’ responses, and the latest pedagogical research, to pinpoint specific areas of misconceptions, discomfort or where students struggle.” The goal, she says, is to “make our tools more versatile in terms of how we help students learn.”

Digital Doubts

This decision is perhaps Pearson’s strongest push yet to drive the higher ed market toward digital offerings. Students and faculty have yet to adopt digital materials in droves, and despite repeated predictions about the death of print over the decades, the physical textbook has remained stubbornly resilient. A report by investment bank Macquarie estimated that print titles made up 45 percent of U.S. higher education courseware sales in 2015.

David Wiley, a longtime textbook researcher and advocate for open educational resources, says many faculty still latch on to print—and for some good reasons. “It’s awesome not to have to worry about battery, internet connectivity or losing your account,” he notes. “There is a surprisingly large portion of faculty who want a printed book on their desk to review before they make an adoption decision.”

Even though Pearson is not cutting out print completely, its digital-first update strategy may still alienate some faculty, says Wiley, who is currently the chief academic officer of Lumen Learning, a company that provides digital OER courseware to colleges and universities.

“It doesn’t matter what a publisher wants to sell. It doesn’t matter what a student wants to use. All that matters is what the faculty chooses to adopt, and the number of faculty who still desire print is still very high,” he notes.

Many of Pearson’s claims about the benefits of its new digital-first textbook update model, such as the ability to deliver more-frequent updates at a lower cost to students and publishers alike, is not news to the OER community, many of which have pushed for digital courseware for more than a decade. “It’s about time that legacy publishers are starting to adapt their model for the digital world,” says Nicole Allen, the director of open education for the Scholarly Publishing and Academic Resources Coalition.

While publishers tout cost savings for students who purchase digital, she is skeptical that this will always be the case. “In the short term, it likely will need to lower sticker prices,” Allen predicts. But if history is any indication, she adds, it would not be a surprise if publishers tack on additional fees. Studies have shown that publishers previously justified raising prices by bundling textbooks with supplemental software that are rarely used.

Today, companies like Pearson and Cengage bundle digital content with other online tools that some students are required to use. This model is not always well received. At Arizona State University, the approach sparked charges by students that it amounts to being forced to pay to turn in homework.

And Allen warns that whatever students may save on digital offerings will be made up for with something that is much more valuable. “Are students paying the price in terms of their data? We need to be asking this of all digital materials, even open educational resources.”

A Scrum for Survival

Regardless of how the print-digital transition unfolds in higher education, Pearson is doubling down on digital as the future of its business. The company reported that 55 percent of its $1.3 billion in revenue from higher ed courseware sales in 2018 came from digital, and that digital rental sales grew by 25 percent over 2017.

The company also claims that college students have already accessed more than 10 million digital courses and textbooks. Still, the company predicts overall revenues this year from U.S. higher ed courseware (both print and digital) could fall by as much as 5 percent from 2018, attributing the decline to projected lower student enrollments and growing adoption of OER materials.

“A digital-first subscription based business is a much more stable and reliable one,” Fallon said on an earnings call this February. And the company envisions that all of its higher ed digital offerings will be part of its cloud-based Global Learning Platform, which he describes as “the adaptive-learning engine of the company.”

Pearson has other product launches planned for this year. Revel, another line of digital courseware, will soon be released on the Global Learning Platform. Also coming this fall is Aida, an app that lets students take a picture of a calculus question and get step-by-step feedback on solving the problem.

These developments come at a time when the textbook publishing industry has seen a number of deals and transactions, all focused on digital courseware. Last August, Cengage launched a subscription that offers students unlimited access to its digital materials. If Cengage’s planned merger with McGraw-Hill Education is approved, this model could soon include titles from both publishers. Meanwhile, Wiley acquired two startups—Knewton and Zyante—to bolster its courseware offerings.

To analysts and followers of the higher ed industry, the flurry of activity marks an overdue, exciting time. But publishers are driven by an existential threat, says Wiley. “Everyone is fighting to stay alive right now, and they’re trying anything they can to stay alive.”

He adds: “In some ways, what Pearson is doing sounds like a huge announcement. In other ways, it’s not surprising at all. In higher ed, textbook publishing is like a wounded animal backed into a corner, and at this point, nothing should surprise you.”

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