Saturday, September 11, 2010

The future is coming early to college bookstores

The trend toward print-on-demand books in college bookstores is gathering momentum. Last month, I wrote about the Espresso Book Machine, and now Hewlett Packard is getting into the act. Both Arizona State University and the University of Arizona have installed print-on-demand systems in their university-owned and operated bookstores. ASU is using the new HP system, while U of A has used an Espresso Book Machine for a year. (Portland State and the University of Kansas are also testing the HP system in their bookstores.)

The biggest goal of both universities is to drive down the cost of college textbooks. In the three largest Arizona universities, students will spend an average of $3,200 for textbooks and supplies over four years. Nationally, the average price of new textbooks went up 12% in 2009, far faster than inflation. Only a small selection of titles are available for print-on-demand at the two universities, but according to Dennis Mekelburg, the associate director of ASU Bookstores, if his school can replace conventional printed textbooks and materials with print-on-demand for 5% of its courses, students would save $500,000 per semester.

McGraw-Hill, John Wiley & Sons and Cengage Learning are supplying a small selection of their titles to ASU for print-on-demand, and the savings can be significant. One Marketing instructor at ASU switched from a conventionally-printed textbook and workbook that sold last year for $250 new to a softcover version of the same textbook and a workbook printed on demand, together priced at about $62.

In the long run, I believe that the most textbooks will be sold as electronic versions, and print-on-demand will be used to provide paper copies for special situations. The sophistication of eTextbooks and the devices used to read them is increasing so quickly that paper textbooks will soon be considered relics.

One big question is what the impact of these changes will be on the bookstores themselves. To date, the print-on-demand phenomenon seems to be limited to schools that own and operate their own bookstores. Publishers are demonstrating a willingness to negotiate better deals directly with colleges and universities, and some schools are in turn showing a willingness to cut the private operators of their bookstores out of the channel in order to lower the prices that their students pay for textbooks and materials. (In the U.S., the largest private college bookstore operators are Barnes & Noble and Follett.) If the college bookstores no longer sell textbooks, or no longer make any money selling them, what will be the role of the private operators? Probably not much. In fact, I wouldn't at all be surprised to see general retailers, anyone from 7-11 to Wal-Mart, compete for the contracts to run these "bookstores". They're likely much better positioned to sell general merchandise than the existing private bookstore operators.
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