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Kate Worlock: Developments in Educational Publishing


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Presentation delivered at the ARLIS UK and Ireland Conference, Bristol, 2013

Presentation delivered at the ARLIS UK and Ireland Conference, Bristol, 2013

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  • Book Industry Study Group recently released the third volume in its ongoing study of Student Attitudes Toward Content in Higher Education. Headlines:Students' preference for print over digital texts dropped from 72 percent in November 2011 to 60 percent in late 2012. In 2012, just under 60% of students used the core physical textbook for their coursework, down from just under 70%. Around 80% students bought, rented or borrowed a used physical textbook for their coursework, down from over 90%.During the same period, preference for online homework systems (MindTap, MyLab, McGraw-Hill Connect, etc.) rose from 9 percent to 14 percent. The picture isn't entirely rosy for digital texts: satisfaction with these works declined in 2012, with only 26 percent of students citing they were "very satisfied" with their digital text, down from 30 percent in 2011.
  • To summarise: effecting change in education is an uphill battle, the pace of change is very slow, and there are lots of problem areas which need addressing.
  • To summarise all of this: Outsell believes that technology is undeniably part of the solution to some of these issues.But technology on its own is not the solution to any of the current problems faced by educators. It is merely an enabler of solutions.
  • So where is digital making a difference?Digital technology in combination with the power of the network is being used to impact on a number of aspects of education:Teaching styles (e.g. clickers)Learning styles (e.g. mobile)Content (e.g. Inkling or Bookshelf textbooks)Pedagogy And even building architectureLast but not least, assessment
  • Increased swing to digitalAs a result of these improvements in attainment, the proportion of content delivered digitally will increase markedly, although within a five-year time frame we still expect to see a hybrid blended learning economy, with print products co-existing alongside digital services. It may well be however that customisation and print on demand are the only ways that print can survive in the longer term. If we assume that the proportion of revenues generated from the sale of digital resources for most educational publishers revenues is currently in the 10% to 30% range, it seems likely that we will see a gradual move over five years to a position in which digital revenues account for 50% to 70% of the total.Content providers moving more to become services and solutions providersOver time, selling content online will become increasingly challenging since teachers and students will be creating their own materials or editing published materials continuously, and exchanging these over the network. Content providers will continue, as Pearson has been doing for years, moving toward their new role as service providers, where revenues will come less from content, and more from tools, solutions, and access to closed communities.
  • Given the nature of this meeting, I wanted to pull out some more specific information on Textbooks.Outsell wrote a report on the textbook marketplace last year, which split the market into three: Print textbooks; Digital textbooks (either flat replicas or more interactive solutions such those produced by companies such as Inkling; Whole course solutions, which may include digital textbooks as just one of many elements which form an integrated whole (examples include Pearson’s MyLab range, WileyPLUS, McGraw-Hill Connect, and Cengage Learning’s MindTap).Digital will not just be print in a new format, but will be a product class all of its ownCurrently digital textbooks are still book-like and deliver a linear learning journey, but going forward they will begin to evolve into their own products, become more interactive and include things like video and online engagement. Solutions like Bookshelf and Comprehensive Curriculum will help publishers to move along this path.The Changing Nature of the TextbookTextbooks were originally designed to accompany the student on a journey through a body of knowledge, and to sit alongside other learning resources as well as the teaching process itself. The print layout is vital to a K-12 textbook as part of the pedagogy of the product. The ability to digitise this content led first to the creation of flat digital replica textbooks, for which demand has been growing largely because of convenience factors – these resources do little to provide additional enhancements to the learning process. The similarity of these products to their print counterparts has been important during this intermediate phase however, ensuring that students with both print and digital are on the same page, for example, or that graphics are associated with the relevant piece of text. These interim products are important in helping the market make the slow change to more advanced digital solutions.True promise of digital: potential to improve learning outcomes. For this an integrated framework is required, encompassing a whole range of content solutions and services. These solutions are complex, and the adoption sales cycle can be a long one – while Outsell believes that these whole course solutions will win out in the end, the process of change and the adoption of new products and techniques is challenging in education markets, and this is exacerbated by the increasing level of complexity of these offerings and the fact that they are often sold on an institution-wide basis, meaning that many individuals are involved in the buying decision process.
  • $19.8 billion in 2011 Forecast to grow at a CAGR of 7.2% to 2014, resulting in a 2014 market size of $24.3 billionWe’ll look at the growth of each segment in more detail in the next slide.
  • Growth in open educational resourcesOERs are growing up. Over the next five years OERs will be used alongside traditional textbooks much as open source software sits alongside its proprietary cousins: these offerings will complement and also compete with any publisher’s portfolio, or software vendor’s product suite.The internet has made duplication a low-cost activity. Creative Commons for content licensing has been a substantial driver of the open education movement. A small ecosystem of companies such as FlatWorld Knowledge has developed to improve the quality of open content. We’re also now seeing bigger commercial players entering this market, such as Pearson with its Project Blue Sky, which allows instructors to search, select, and seamlessly integrate Open Educational Resources with Pearson learning materials.
  • And the delivery of open coursesIn 2002, MIT announced the OpenCourseWare initiative. This was a seminal development that raised many questions about the economic value point of education. Since content can be easily duplicated, with low or no costs, it doesn’t seem reasonable to compete on the basis of superior curriculum. However, it’s only in the last year that MOOCs (Massive Open Online Courses) have truly become massive. Stanford launched an open course in Artificial Intelligence in the fall of 2011 which attracted 160,000 students. Since then, we’ve seen the formation of other players such as edX, Coursera and Udacity. Close to $100 million has been invested in MOOC providers in about the last year, so someone certainly sees the potential.Does that means that this is what lecture theatres are going to look like in a few years’ time?
  • If the demand for print continues, even from barely a quarter of the customer base, publishers must continue to serve this market once they have made the flip to a digital-first strategy. However, serving this level of demand through a traditional inventory model of large-scale print runs of identical titles will no longer be feasible. In 10 years, Outsell expects that this inventory model will have become a thing of the past, with the future for print tied closely to the opportunities enabled by customisation, and by print-on-demand technologies. Nonetheless, a role for print is certainly on the cards. Using the music or television industries as an analogy is valuable here: there is still consumer demand for multiple formats including vinyl, CD, and MP3, and radio audiences remain substantial despite the presence of alternative entertainment media such as television.
  • Huge choice out thereHigher education: likely that most digital textbook content will continue to be read on either a laptop or a smartphone, since these are the two categories of devices most students already own. However, tablet access to these materials is increasing rapidly as penetration levels of these devices increase in both higher education and K-12 markets NEW PEARSON DATA: one quarter of respondents owning a tablet device, up from 7% in the same survey the previous year. The study also found that 63% of college students believe that tablets will replace textbooks within the next five years. Perhaps the most surprising finding was that 58% of college students prefer a digital format when reading textbooks for class - this is a reversal from last year, when more students preferred print over digital.Importance of mobile devices difficult to overemphasise: CourseSmart reports that 10% of its transactions are now done via a mobile platform (this figure was less than 2% before the introduction of the iPad), and that 30% of students using the service have expressed a preference to use a tablet device to access this content rather than any of their other devices.Not just multiple devices, multiple platforms and readers: Kno, VitalSource, Inkling, CourseSmart and YDP’s Bookshelf. Platform decisions are likely to be based around content availability, price, and functionality, or may be mandated or suggested by a faculty member. It remains a confusing world from a student perspective, although services are emerging that may start to make life a little easier – for example, a scraping website called TextYard provides a pricing comparison service, giving students options and information about where to buy their textbooks.
  • So what does this mean for textbooks?The death of the print textbook remains a long way off BUT there is a strong potential that the form the print textbook takes will morph significantly. A blended future of print and digital content is the most likely scenario, since all faculty teach differently, and all students learn differently. However, the proportion of digital in this blended model will continue to increase.Anecdotal evidence: even where digital is the leading offering, a significant proportion of students will continue to choose a print alternative. e.g. Flat World Knowledge: 20-25% of sales come from print, even though the business is digital-firstA print plus digital mix is also a popular choice – SharedBook reports that more than 80% of the purchases made through AcademicPub contain some print element. Over the next five years, Outsell expects to see the traditional textbook publishing market make the flip to digital – in other words, more than 50% of traditional textbook publishers’ revenues will be derived from digital solutions. In this scenario, print becomes the secondary offering, not the product behind which developmental strategies are formed. It seems likely therefore that over the subsequent years, the inventoried print textbook will become a thing of the past. Print options will be strongly based around print-on-demand (PoD), with students either choosing to self-print, order a printed version online, or have a copy printed at their local college bookstore. This will in turn open up a world of options with regard to customisation: everything has the possibility to be customised either at the class or the individual level. Outsell’s opinion is that PoD or self-print is the only way that print can exist in 10 years.
  • So what does this mean for the future?Digital solutions will be sold through subscriptions not one-off transactions, resulting in closer client relationships, and more institutional purchasing in higher education
  • Transcript

    • 1. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c .A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n Developments in Educational Publishing ARLIS Conference 2013 July 2013 Bristol, UK Kate Worlock VP & Lead Analyst, Education & Training
    • 2. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Agenda How is the world of educational publishing changing?  About Outsell  Setting the scene  Drivers of change in higher education publishing  What are publishers doing?  A look to the future  In Outsell’s opinion 2
    • 3. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Learning and Innovation Information, Media, and Technology Life and Career Source: United Nations photo Demands on Education are Increasing Not just imparting knowledge, but skills Knowledge 21st Century Skills 3 Core Subjects
    • 4. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Schools Face Multiple Pressures Like all markets, education is experiencing a perfect storm Economical Pedagogical Political Technological 4
    • 5. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . We prefer print over digital, but not as much as we used to. We’re becoming more keen on digital homework solutions. We’re less and less impressed by flat digital texts. We’d rather buy, rent, or borrow a used textbook. Students Are Becoming More Vocal Digital natives have high expectations as consumers 5
    • 6. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Effecting Change in Education is Difficult Educators and administrators face an uphill battle 6 Source:
    • 7. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Technology is Not the Answer Although it can be a vital enabler of change and improvement 7 Source:
    • 8. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Teaching styles Learning styles Content Pedagogy Architecture Assessment But Digital Can Make a Difference Its influence is felt across the board 8
    • 9. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Digital Enables New Models of Education Publishers must take note of changing pedagogic practice Flipped classroom Adaptive Learning Virtual Learning Testing and Assessment 9
    • 10. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . So, What are Publishers Doing? First, they’re focused on digital for growth DigitalPrint Improve learning outcomes Reduce costs Save time Increase faculty productivity 10
    • 11. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . This Means Revamping Old Products The textbook is evolving 11
    • 12. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . - 5,000 10,000 15,000 20,000 25,000 30,000 2009 2010 2011 2012 2013 2014 $M Print Textbook Content ($M) Digital Textbook Content ($M) Whole Course Solutions ($M) And Changing the Shape of the Market Print remains important, but its market share is shrinking Source: Outsell analysis 12
    • 13. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . There are Challenges from Open Content Publishers are working out models which include OERs 13
    • 14. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Publishers Are Dealing with an Evolving Space New players are delivering educational accreditation 14
    • 15. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . And They’re Preparing for a More Virtual World With empty lecture theatres? 15
    • 16. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . They’re Building Customised Offerings Personalisation and adaptive are the name of the game 16
    • 17. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . They’re Delivering Solutions to Many Devices Platform and device agnosticism will be crucial 17
    • 18. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2020 2012 Print Textbook Content Digital Textbook Content Whole Course Solutions By 2020, Print Will Be 30% of the Market And whole course solutions will make up almost 50% Source: Outsell analysis 18
    • 19. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . More institutional subscriptions In Outsell’s Opinion By 2020, educational publishing will look very different Device and platform agnostic content Digital replica textbooks have a limited shelf life 19
    • 20. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . What Does This Mean for Libraries? What are the implications in an arts and humanities context? 20 Digital literacy Customisation support Print on demand Curation Support remote students OER guidance
    • 21. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . Thank You for Your Attention 21 “It is not the strongest of the species that survive, nor the most intelligent, but rather the one most responsive to change.” — Charles Darwin Kate Worlock, VP & Lead Analyst, Education & Training Email: Phone: +44 1494 778 100
    • 22. A d v a n c i n g t h e B u s i n e s s o f I n f o r m a t i o n © 2 0 1 3 O u t s e l l , I n c . About Outsell Outsell, Inc. is the world’s only research and advisory firm focused solely on media, information, and technology. We use a time-tested, quality-proven, top-secret blend of data, brains, community, and pizzazz to produce extraordinary value for our clients. Elite information industry executives from all over the world look to Outsell for trusted advice, bold insights, and confidential access to exclusive intelligence and decision support. Outsell has your back. You’ll stay more focused, save time, and grow revenue in a fast- changing, global, digital environment, and sleep better at night. Guaranteed. Burlingame, CA · USA +1 650-342-6060 London · United Kingdom +44 (0) 20 8090 6590 The information, analysis, and opinions (the “Content”) contained herein are based on the qualitative and quantitative research methods of Outsell, Inc. and its staff’s extensive professional expertise in the industry. Outsell has used its best efforts and judgment in the compilation and presentation of the Content and to ensure to the best of its ability that the Content is accurate as of the date published. However, the industry information covered by this report is subject to rapid change. Outsell makes no representations or warranties, express or implied, concerning or relating to the accuracy of the Content in this report and Outsell assumes no liability related to claims concerning the Content of this report. 22