The Adoption Model is dead, long live the Adoption Model

Once upon a time – not that long ago, actually, the education publishing world was in predictable order and all the education publishers flourished. With a captive market and minimal competition, these publishers lived happily for a very long time.

But, all was not as happy as it seemed. One day, the breaking point was reached and their captive market (called students), stood up and called foul play. “Foul play,” because to graduate with success - they had no choice but to buy the textbooks adopted by their professors and to endure the annual increases to their text book.

Suddenly, a new model arose offering students, alternative low-cost solutions. These included: used and rental textbooks first and then a fledgling Open Educational Resources (OER) movement offered free content.

This accelerated the percentage of students who stopped buying new textbooks and the so-called “sell-through” (% of students in a particular course who bought the new book) plummeted to below 50%. Publishers sprang into action in the hope of saving their textbook businesses by creating bundled products (text books with supplemental online homework and assessment solutions) that required special access codes but students continued to rebel at the register and the sell through rate continued to drop.

A non-sustainable downward spiral began, which took a huge toll on the industry’s image as whole with revenues down over 10% year over year for multiple years at the major publishers. Mergers, divestments, huge staff layoffs, steady streams of executive changes, and bankruptcies followed.

Was this to be the fate of these 800-lb. gorillas? Something had to change. The digital revolution of the industry, which at first was perceived as a threat to the book-publishing industry, all of a sudden became the unintended savior…though arguably at a price.

What followed was a realization that the sooner publishers convert students from physical books to digital courseware products in an “inclusive access model” (meaning that every student has the same digital course materials, with the charge included as part of their tuition), the sooner the sell-through leakage would be stopped, and the rental/used books threat would be taken off the table … because you can’t rent digital experiences.

Selling digital courseware solutions, however, presents a new set of issues and opportunities, depending on how you look at it, of course. Suddenly, the once static content world becomes a dynamic digital content world, demanding for customization and integration of college/instructor created content as well as OER content. These new, integrated types of environments - called “digital learning platforms” - are best deployed and sold on an institutional level, since they are as much of a cloud-based software offering as they are content/courseware offerings.

Btw, did I mention that the book author doesn’t matter as much anymore, in this digital world of learning (except maybe for Mankiw and a few others of course)?

The institutional model is in many ways ideal to publishers, since selling on a subscription basis to the entire campus and then mandating use by students, leaves the students without any used or rental alternatives. In essence, this model allows education publishers to recapture that once-captured market. That’s the vision, at least. The limitation, however, is that it only works in organizations with centralized purchasing decisions, hence for-profit schools and maybe certain community colleges.

In all other situations, where academic freedom is the first organizing principle, it is unthinkable to push these decisions down the throat of a faculty that takes pride in having that freedom to teach or communicate ideas or facts, even if inconsistent or contrary to that of other faculties or the institution as a whole.

A dilemma for which there might be a solution now, called “Unlimited,” as recently rolled out by Cengage Learning. “Unlimited” is essentially an all-you-can-read per semester subscription for all of the publisher’s digital titles. A compelling direct-to-student offering for those students with more than two courses using Cengage materials, provided of course, the students know about it, which is largely a function of aggressive marketing.

But more importantly, “Unlimited” becomes a strong selling tool for the publisher’s sales force when reasoning with faculty in the adoption process to endorse this quasi-institutional model for economic reasons. Who doesn’t want to help save students money after all? Certainly, by taking this bold step and up-ending its traditional business model, Cengage made a smart and progressive move – one that stunned its competition.

I am looking forward to seeing how the market will respond to this fresh model. But, needless to say, the traditional adoption model is not going to be replaced by an institutional model any time soon. So why not do what Cengage is doing and provide a content-driven and straight-forward economic incentive for faculty to adopt Cengage courseware?

I conclude this blog by saying “to be continued,” because even in the evolving world of education, one thing is certain: change is the only constant in this transitional phase and in a year from now, when other publishers have released their versions of “Unlimited,” things will look differently again.