Pearson Is Going “Digital First” With their College Textbook Catalogue
By Henry Kronk
July 16, 2019
Pearson laid plans on July 16 to transition out of their traditional college textbook publishing strategy to cater to the evolving needs of institutions of higher education. Going forward, the company will prioritize ebooks and digital content over print materials. The company also announced it would be reducing the prices of their textbooks accordingly.
Ebooks will reportedly cost $40 on average while a ‘full suite of digital learning tools’ will come in at $79. Students who still want a print text will be able to rent one for the price of $60. These prices will be lower still at the institutions that use Pearson’s Inclusive Access service.
Pearson Transitions to “Digital First” College Textbook Publishing
“Students are demanding easier to access and more affordable higher education materials, with nearly 90% of learners using some kind of digital education tool,” said John Fallon CEO, Pearson, in a statement. “We’ve changed our business model to deliver affordable, convenient and personalized digital materials to students.”
The company says that roughly 62% of their total revenue now comes from digital products or services, and that the move fits in accordance with this reality.
Taking in the textbook market as a whole, however, the move marks the latest shoe to drop as the industry realigns.
It has been nearly one year since Cengage debuted their Unlimited service, which gives students digital access to their entire catalogue for a semester-based subscription fee.
While textbook subscription services have seen popular uptake, individual sales still take up most of the oxygen in the room. Other publishers, meanwhile, have seen success for a few years with the general model Pearson adopted today.
An Industry in Transition
These changes have come after education stakeholders have grown more widely aware of the practices large academic publishers were using. Student PIRGs has tracked the college textbook market for over 10 years. They discovered in 2016 that the average textbook price had risen over four times the rate of inflation during that period.
Besides the release of Cengage Unlimited, the company has also announced plans to merge with McGraw-Hill Education earlier this year.
Houghton Mifflin Harcourt, meanwhile, has been building digital capacity on their own.
Pearson sees the move to digital-first as a means to keep students dealing with them directly.
“Our digital first model lowers prices for students and, over time, increases our revenues,” said Fallon, in a statement. “By providing better value to students, they have less reason to turn to the secondary market. This will create a more predictable, visible revenue stream with a better quality of earnings that enables us to serve the needs of learners and customers more effectively. Our digital courseware makes learning more active, engaging and immersive, improving outcomes for students and their teachers, and helping college leaders meet the growing demand for lifelong learning.”
Pearson has a history of acquiring edtech providers to bolster their offerings. But earlier this year, they made a unique move in the publisher space. They announced they would be launching their own investment fund. Pearson Ventures has $50 million in the bank and plans to use it to make strategic investments over the coming years.
Featured Image: Martin Adams, Unsplash.