Tuesday, July 04, 2006

Textbooks are Doomed.

Here’s another omen of the end for textbooks. And here. And here. And here. And here.

Textbooks sit unused in the backs of classrooms. Teachers increasingly don’t use them. Students almost never use them. And yet almost $2 Billion is spent annually on textbooks in the United States.

When will those dollars go to technology? Look, when private foundations and individuals start to fund purchases of laptops for schools, you know something is wrong. And what is wrong is this: textbook publishers have major stakes in insuring that textbooks get purchased, even if they are not used. They are willing to do what it takes politically to make this happen. In 2005, the Texas legislature almost managed to get the appropriations for textbook purchases shifted to technology. In the 11th hour, the textbook publishers moved in and successfully lobbied for the status quo, so now the shift from textbooks to technology will have to wait until the next adoption cycle—six years from now.

The textbook publishers know this is a holding action. They know that students, parents and increasingly, teachers are going to demand instruction that is centered on technology. The problem is that the publishers don’t know how to provide this service. They don’t know how to build it. They don’t know what it means for pedagogy. Most importantly, they don’t know how to do this and still generate the same margins they are currently generating with textbooks. Since they are almost all publically traded companies, they cannot afford to depress their stock price by experimenting with technology.

Pearson is an interesting exception to this rule. They’ve been making major purchases of instructional technology (Powerschool, Chancery, ELLIS). I’m not convinced they know what they are doing with that technology, or that they know how to manage it. I’ve seen no major announcement that they’ve hired an executive from the software industry to oversee their technology investments (and this is a minimum of what it would take). This is a seriously risky proposition for their management: if the technology investments don’t payout in the short term, the pressure will grow to divest themselves of the underperformers. Given that the driver of growth at Pearson is their financial services units, and that these units seem strongly invested in technology, this may play out. But my guess is that two quarters from now, if the stock is substantially depressed from where it is now, you’ll see an executive shakeup, followed by a divestiture.

So we are left with the major publishers struggling with the economics of technology, and schools struggling with the pedagogical implications of technology. In the meantime, everyone is buying and using technology. Something has to change.

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