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Big Textbook is being consolidated.
<p class = "canvas-atom-text-canvas Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "With a handful of companies controlling the market, the merger recently announced & nbsp;enter& nbsp; McGraw-Hill and Cengage – two of the largest textbook manufacturers in the world – compound a "broken market for textbooks," experts say. The merged company would be named McGraw Hill, generating about $ 3.16 billion in annual revenue and estimated at about $ 5 billion. "Data-reactid =" 16 "> With a handful of companies controlling the market, the recently announced merger between McGraw- According to experts, Hill and Cengage, two of the world's largest textbook manufacturers, is worsening a" textbook market " "ruined school", which should call McGraw Hill and generate an annual business figure of $ 3.16 billion worth about $ 5 billion.
<p class = "canvas-atom-canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The proposition & nbsp;merger& nbsp; – which would gather 44,000 titles of printed and online books, as well as a subscription program – is to "consolidate the power in fewer companies and strengthens the problem," said Yahoo Finance Campaign Director Kaitlyn Vitez for higher education at PIRG. "data-reactid =" 17 "> The proposed merger, which would bring together 44,000 titles of print and online textbooks, as well as a subscription program," consolidates power in fewer companies and businesses. reinforces the problem, "said Kaitlyn Vitez, the senior campaign manager at PIRG, told Yahoo Finance.
"Unless they significantly change their marketing strategies and products as part of this merger … the same broken market for textbooks is in place," she added.
And the long-term implications are worrisome, said Nicole Allen, director of Open Education at SPARC, Yahoo Finance.
"The future of textbook publishing is not about content but about data and analysis," Allen said. The bigger the business, the more data empire you can accumulate is great, and the more you can create and resell to institutions services. "
Employees retrieved their textbooks from Chegg Inc. warehouses in Shepherdsville, Kentucky, USA on Thursday, April 29, 2010. (Photo: John Sommers II / Bloomberg via Getty Images)
<h2 class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = ""Textbook market is broken""data-reactid =" 41 ">"Textbook market is broken"
<p class = "canvas-atom-text-canvas Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "An average student spends $ 484 on required course materials, according to & nbsp;National Association of University Stores. And although this cost is significantly lower than in 2007 (when a student was spending $ 701 on textbooks and teaching materials), the other $ & nbsp;fees& nbsp; have made their appearance and these dollars are definitely adding up. "data-reactid =" 42 "> An average student spends $ 484 in required course materials, according to the National Association of College Stores.This cost has dropped significantly from 2007 – when a student would spend $ 701 on textbooks and teaching materials – other expenses have been recorded and these sums are added together.
"Teachers assign materials and students have to buy them," Vitez said. "This leaves the publisher to raise prices as much as he wants. They will create custom editions for hard to resell classes. "
Textbook prices remained high, while leisure books remained stable over the same period.
"The cost of textbooks has increased four times faster than inflation," Vitez noted. "That's because the textbook market is down."
For years, reports have looked at how Cengage, McGraw-Hill, Houghton Mifflin and Pearson Education largely control the textbook industry, large companies that can dominate the market with their deep expertise in teaching materials and their relationship with the universities.
"The economic structure of the prescription drug market and the textbook market is very similar," said Allen of SPARC. "In both cases, the person who is an expert … [and they] create this dynamic that gives the publisher or the pharmaceutical company the burden of charging very high prices … Their goal is to generate profits. "
<p class = "web-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "In 2020, the national market for educational services is expected to reach $ 2 trillion according to & nbsp;GSV Advisors. "data-reactid =" 68 "> In 2020, the national educational services market is expected to reach $ 2 trillion, according to GSV advisors.
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "And with few players getting a piece of the cake The company Houghton Mifflin Harcourt, for example, one of the industry's titans, had net sales of $ 1.12 billion with educational materials & nbsp;last year. "data-reactid =" 69 "> And with few players having a piece of the pie, Houghton Mifflin Harcourt, for example, who is one of the big titans in the industry, achieved net sales $ 1.12 billion last year.
Textbooks sit on a shelf at the Chegg Inc. warehouse in Shepherdsville, Kentucky, USA on Thursday, April 29, 2010. (Photo credit: John Sommers II / Bloomberg via Getty Images)
Students, meanwhile, feel rushed.
<p class = "canvas-atom-canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "" Most of the time, I had to buy things that are in basic classes, "Kenan Saleh, a student at UPenn, who also wrote a & nbsp;op-ed& nbsp; against electronic textbooks in his school newspaper, told Yahoo Finance. "They are part of your note to answer the questions they have. The online ones are particularly egregious. I never understood that. "" Data-reactid = "96"> "Most of the time, I had to buy things that are in the main classes," Kenan Saleh, a student at UPenn, who also wrote an editorial against electronic textbooks. In the newspaper of his school, he told Yahoo Finance. "They are part of your note to answer the questions they have.The online questions are particularly egregious, I have never understood these answers."
Vitez also pointed out that homework and quizzes are increasingly hidden behind an academic version of paywalls that requires an updated subscription to a textbook.
In other words, students pay for a service to access a) read the manual, b) perform work and c) take exams.
Most of the time, access codes expire at the end of the semester, which means that students lose access to these valuable documents after a short time.
"The textbook market keeps students in captivity because they have to buy the equipment that's assigned to them," Allen said. "The students are really captive and can be frustrating. We have been working for many years to encourage students to contact their teachers … provide at least information on where to book for more affordable supports. "
<h2 class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Disturb from the inside"data-reactid =" 121 ">Disturb from the inside
Publishers are not unaware of the problem. In an interview with Yahoo Finance before the merger project, Cengage said it was doing its best to look for creative solutions to this problem of inaccessibility.
"What brought me to Cengage about six and a half years ago was essentially the challenge of really integrating a very traditional business and a very traditional publishing business model into the 21st century and going digital Said Michael Hansen, CEO of Cengage Learning. I said.
"The student experience was still deeply entrenched in the 20th century," said Hansen, who will likely lead the new McGraw Hill entity. "The vast majority of students from kindergarten to grade 12 or higher have basically learned from traditional press manuals that there is very little digital activation."
Therefore, proposing a digital model capable of personalizing the learning experience would be "extremely powerful," he said, adding that it is "pathetic that this is happening so little is happening." Student experiences in the United States and elsewhere in the world today. . "
In dealing with the problem of affordability, the company has developed a subscription service called Cengage Unlimited.
"You should consume educational material like you are consuming movies today," Hansen said. [means] Basically, with a monthly subscription, you get everything you need, there are no more hidden costs.
The initiative has been a success, Hansen added, adding that one million students were enrolled in less than seven months.
Brittany Wolfe, a graduate in Applied Mathematics from the University of California at Los Angeles in 2010, is checking old textbooks at the UCLA Powell Library building in Los Angeles. (Photo credit: AP Photo / Damian Dovarganes)
Professors like Clifford Wright of Xavier University in Louisiana bear witness to this.
"We started using them last fall and Cengage came to see us," Wright said in an interview. "We are satisfied with the books, but I am very worried about the increase in their cost. … So [when] Cengage came and offered a package for 1 pound at $ 119 and all the other books for free, we jumped on last fall. "
Students can take 4 courses and pay only $ 119 for materials. "The new Cengage program brings them only the online book at a very low price," he added.
When asked about Cengage's product, Vitez was concerned that there was no guarantee that the price would stay the same.
"They advertise their product as a Netflix style product," she said. "You and I, as well as the rest of America, know that this price is rising. … they have to show that items such as access codes are going to be a better deal for students. "
Hansen said the company wanted to keep textbook prices down because the educational materials "should be affordable and tailored to your needs. And I think we can do it in the next five years. "
<h2 class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = ""The problem is not digital""data-reactid =" 155 ">"The problem is not digital"
Vitez PIRG is not convinced.
"The problem is not digital," she said. "The problem is that access to closed equipment has expired. When we think of these short-term access codes or these short-term online e-renting manuals, students can not keep them or resell them and get their money back. "
Vitez added that the courses most likely to require expensive textbooks and access codes are introductory courses "with many homework assignments for which teachers are looking for easy filing solutions".
A mother buys textbooks for her son who is outside the USC student store on 17/08/2005. (Photo credit: Bob Chamberlin / The Los Angeles Times via Getty Images)
The agreement between publishers and institutions that automatically charge textbooks to students, according to Allen and Vitez, is another aspect of the problem that affects many students.
Thus, in some cases, students who enroll in a degree can automatically be charged the price of the textbook even before taking the course due to an existing agreement between the publisher and the student. 39; school.
<p class = "canvas-atom web-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "It happened last autumn – The biggest public technique of South Carolina college was & nbsp;found& nbsp; have added automatic fees to student tuition bills for limited access to Pearson's electronic textbooks. They presented it as an "inclusive access" designed to help save money to students. "Data-reactid =" 181 "> That's what happened last fall – it was discovered that the largest public technical college in South Carolina had added automatic fees to student tuition bills Access to Pearson's limited-time electronic textbooks is presented as "inclusive access" designed to help students save money.
"Publishers are not stupid," local paper Jeremy Cucinella, regional director of Virginia Pirate Corp., owner of Textbook Brokers in North Charleston, told local newspaper. Publishers "have targeted these community colleges where the student population is not as rich as that of four-year-old schools … The program is extremely confusing and frustrates people."
Vitez added that the trend was becoming more common and that "publishers will approach schools and only sign an agreement. … It's great if they provide students with equipment whose price is lower than the market price, "she added. "But we should not push students to access codes."
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Aarthi is a writer for Yahoo Finance. Follow her on Twitter @ aarthiswami."data-reactid =" 184 ">Aarthi is a writer for Yahoo Finance. Follow her on Twitter @ aarthiswami.
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