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Why hasn’t the tech industry disrupted the textbook industry yet?

October 30, 2013

Gagan Biyani, Co-Founder of udemy.comCo-Founder of

My view is that the innovation required for textbooks is far beyond what most companies are doing. In fact, I think most entrepreneurs (and their investors) are completely missing the boat here.
Think about WHY people would ever change from a physical to an electronic textbook. In the consumer world, we had the technology to move physical books to digital books over 10 years ago. Why weren’t we reading books on our computers before 2007? One answer: the Kindle, and other similar portable e-readers (iPhone/iPad included). Moving books to digital was not the real value prop – the value proposition was having a lighter, handheld library on the go! Until that was possible, nobody wanted to read digital books.
With textbooks, it gets a bit more complicated. First, we’re dealing with an enterprise-style buying process (as Marc Bodnick explains below). The textbook publishers are also facing a major innovator’s dilemma. As a result, the costs have not come to parity (aka you have to buy the same textbooks but now you also need an iPad or e-textbook reader). Second, its a MUCH smaller market (in terms of # of consumers), so you need greater penetration to make the economics work.
I think textbooks need to do MORE than just take their content digital. There are 2 aspects to this:

  1. Media. Personally, I think too much focus is on collaboration and not enough on rich media. When I’m learning how circuits work, it would be awesome to have a model of a circuit on an iPad that I could play around with. The problem is taking this approach to all textbooks will cost millions of dollars. However, I am sure that this will eventually lead to richer learning experiences.
  2. Price parity. You have to have a company brave enough to bring the cost of digital textbooks to parity with buying physical textbooks. Amazon did this with the Kindle and ebooks – and stuck it out for years of subsidizing ebook publishers, taking a loss on Kindles sold, etc.

The problem is that #1 and #2 are very hard and capital-intensive. The alternative has been startups focusing on the much more scalable, but far less useful, aspects of digital textbooks: (A) Social and (B) Note-taking/highlighting. For (A), I just think its absurdly overrated. I don’t think college students will buy digital textbooks solely so they can collaborate with their friends. They feel like they do that anyways. For (B), it is a real value to be able to write notes on the page without destroying the book, but its not ENOUGH of a reason to force switching.
Ultimately, someone has to provide a digital textbook experience that is so kick ass that it encourages consumers (students at Universities) to switch. They also have to figure out how to get the costs down while staying in business, and to obtain buy-in from the publishers.
I agree with Marc that it is already happening, but if you want to know what will cause the “tipping point,” I think its all about media and pricing.


From → Textbook News

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