Phil wrote up some excellent observations yesterday about the announcement that Follett has invested in Lumen Learning and will be distributing some of their products. This deal has more significance for the curricular materials market than the (relatively) small dollar amount of the investment would indicate.
Before diving into the substance, I want to repeat Phil's disclosure that we are consultants to Lumen Learning and grantees of the Bill & Melinda Gates Foundation, which has both given grant money to Lumen and is more generally promoting the idea of courseware. I'll add that we currently consult for or have recently consulted for three of the five biggest higher education textbook publishers and a major curricular materials distributor (though not Follett). So we are not without our entanglements. The upside is that we get to see the market from a lot of different angles.
As I have written in the past, the textbook publishers have an addiction problem. They can no longer get the profits from printed books that they used to get, thanks to the used book market, textbook rentals, OER, and the general cleverness of students at figuring out ways to avoid paying an arm and a leg for a book that they only expect to need for 15 weeks (if they need it at all). Books are not giving publishers that top-line "high" that they used to. From business perspective, the businesses-formerly-known-as-textbook-publishers want to move to more feature-rich digital products that, they argue, have enough additional utility and impact on student outcomes to justify a premium price.
At the same time, while these companies increasingly make their profits on digital, a lot of their revenues still come from print. They still need their cash "fix" from book sales and are having a difficult time kicking the habit.
As a group, their main response to this dilemma so far has been to offer flat PDFs, nearly flat PDFs through (often kludgy) specialty ebook readers that have extra bits of functionality, loose-leaf binder versions of the book, and/or their own textbook rentals. These are all variations of "here's the book in the cheapest form we can come up with." There's very little about most of their low-end offerings that takes advantage of digital affordances.
Many of the publishers are deeply conflicted about this strategy and haven't figured out how to sell their lower-cost offerings in a way that is not utterly confusing to students.(Some of the publishers are more coherent than others, but this has been the overall pattern so far.) As Phil has reported, this mess of unclear options appears to disproportionately harm those students who need the pricing break the most.
Now along comes Lumen Learning. They don't have sixty-seven versions of the same title running through forty-three different distribution channels. Their pricing is simple, clear, and competitive with the low-end products. The product's interactivity is designed in from the beginning rather than grafted on as an afterthought. It also lends itself to customization by the instructors in ways that the bargain basement offerings from the publishers often don't. And it introduces faculty to the "five Rs" of OER (retain, reuse, revise, remix, and redistribute).
That's not new. What's new is that Follett—a company that runs thousands of physical and virtual college book stores—is investing in Lumen and promoting their offering. While the distributor has very carefully calibrated their public statements, the fact is that they are no longer fully neutral. They are giving OER a big boost in visibility to the faculty who select the curricular materials and ease of acquisition to the students who use them.
I don't have a lot of insight into what's driving Follett to make this move beyond their statement that faculty are asking for easy-to-adopt OER options. But one possibility is that the publishers are increasingly disinclined to sell their premium digital products through the bookstore. If students have to go to a web site to purchase the product anyway, why pay an intermediary? Why not just have the students buy direct from the publisher? To the degree that publishers are beginning to see distributors less as allies and more as competitors, then companies like Follett will have an increasing interest in promoting alternatives that they can continue to sell, even if at a lower price.
We've seen lots and lots and lots of failed attempts to "disrupt" the textbook publishers. This feels different. I'm not suggesting that Lumen will put Pearson and the others out of business. Rather, this investment and distribution deal is a sign that the textbook publishing industry, which has improbably managed to maintain its balance on a knife-edge for a long time, may finally be entering a period of rapid change that will, in turn, shape the choices that students and teachers have in unpredictable ways.
This could also impact the open education community in unpredictable ways. When Phil and I gave a joint keynote at the OpenEd conference in 2015, two of the questions we asked were the following:
- What are your goals for embracing open education?
- Who are you willing to let win in order to achieve your goals?
If the goal is to increase student access through lower and more transparent pricing, then this deal could help. If the goal is to promote awareness of the "five Rs" that could ultimately lead to wider adoption of open educational practices, then this deal could also be helpful (though probably less immediately impactful than it will be on cost). If, on the other hand, the goal is to drive all large commercial interests out of education, then this deal will not be helpful.
The open education community is not unified around goals and priorities. It will be interesting to see how various participants react to the commercial success of Lumen (and, for that matter, OpenStax).