From Industrial Revolution to Knowledge Economy: Digital Textbooks Advance Education and Let Publishers “Reclaim” Lost Revenues

Burlingame, CA, and London, UK—May 27, 2010—The printed textbook has long been a staple of the educational process, but today that marketplace model is fraying at the seams. New research from Outsell, Inc. shows that the relatively slow adoption of digital products for education is speeding up—opening new revenue opportunities for publishers while helping to rewrite the roadmap for teaching and learning.

Outsell estimates the total global market for K-12 and post-secondary textbooks was $15.2 billion in 2009 and will reach $16.6 billion by 2012, representing a modest CAGR of 2.6 percent. Digital textbook products will fuel the market growth, with a CAGR of 25 percent, while revenues from print textbooks will decline by 1 percent.

“Essentially, we have been educating the next generation using methods suitable to the industrial revolution, not to the knowledge economy, but that’s changing,” said Kate Worlock, director and lead analyst, Outsell. “The pace of change over the last year alone has far exceeded the previous 4-5 years.”

The Outsell report analyzes key market trends, including:

Content customization—Macmillan’s launch of DynamicBooks is an example. Educators can edit and alter these texts down to the sentence level, and make them available online, via print-on-demand, or through an app.

Open source textbooks—These make free quality content available to all learners and researchers. Flat World Knowledge, for instance, provides students with free access to online content, charging for downloads and print editions.

Textbook rental—A reaction to students’ dissatisfaction with the perceived high prices of must-have texts, this is essentially the used book market in a different guise. Chegg is one of the independent market leaders, with publishers like Cengage Learning also joining the game with their CengageBrain service.

The Outsell report provides case studies of eight publishers’ innovations—including Pearson, Elsevier, Cambridge University Press, and CourseSmart, in addition to those mentioned above. It also provides potential market scenarios over the next 10 years and their likelihood of occurring, and strategies for publishers to “reclaim” revenues lost during a print-only era.

To purchase the report, please visit http://www.outsellinc.com/store/products/922?refid=pr922.

For interviews, contact Dawn Ringel, Warner Communications, 781-449-8456 or dawn@warnerpr.com.

ABOUT OUTSELL, INC.
Outsell is the only research and advisory firm focused on advancing the publishing and information industries. Our international team provides independent, fact-based analysis and actionable advice about competitors, markets, operational benchmarks, and best practices, so our clients thrive and grow in today's fast-changing digital and global environment. Outsell tracks and analyzes over 7,000 information industry companies, as well as the needs, habits, and spending patterns of advertisers, enterprise information buyers, and end users. Outsell’s headquarters are in Burlingame, CA, with offices in London and in Cambridge, MA. See www.outsellinc.com.