The Answer to Escalating Textbook Prices?
Freeload Press, a Minnesota-based publisher and distributor, made headlines last year upon publishing college textbooks featuring advertising for everything from study guides to credit card companies. The company offers these books to students at significantly reduced prices in print or PDF format, and many for free download on its Web site. The goal is to offset the constantly increasing price of required course-reading materials for college students. Freeload now has almost 250 student versions available for download.
An academic panel helps with ad placement in the PDF e-textbooks, and the “StudyBreak Ads” are placed in natural breaks in the printed books. Freeload Press Founder and CEO Tom Doran talks about the new ad-supported business model and his expectations that other publishers soon will be on board.
● What do you believe is wrong with the current model of textbook publishing?
Tom Doran: Obviously, the big thing is the price. Students are increasingly not buying textbooks. The National Association of College Stores uses a figure that 64 percent of students are not buying all their required course material. We think that puts everybody’s investment in higher education at risk. Most instructors agree that textbooks are critical to a course’s success.
Why is [the price high]? It’s a couple factors. It’s not just the publishers. Sometimes the publishers take too much of the long-end of the stick on this one. It’s expensive to [produce quality] textbooks and provide all the instructor material. But it’s a blend of different things, including the distribution system, used books and the amount of returns. All those factors combined make it a perfect storm.
The bottom line is that the price is too high. The numbers you see out there [are between] $650 and $900 a year that a typical student pays for textbooks. For a lot of these kids … there’s sticker shock. A lot of times they’re the ones who are paying. …We’ve been in bookstores and have literally seen kids break into tears. It’s a real problem.
● What’s the secret of Freeload’s success so far? Why hasn’t this been done before?
Doran: It just got so over the top with students going without books or with the wrong editions that even the academic community started to become concerned. We also saw that the technology was in place to distribute from Point A to Point B with digital delivery. Those two things combined to give us the opportunity to say, “Hey, we know advertising is an extreme way of doing this, but if we can deliver free textbooks, would that work?”
Preliminary research was much more positive than what we thought. We thought maybe 25 percent to 30 percent [of the market] would be OK with it. With the first 1,000 instructors we talked to, we got an 82-percent approval rating on the idea, which just stunned us. I think the problem is a lot worse than a lot of people know.
A lot of these kids are migrating away from print anyway. In addition to the bandwidth being there so we can deliver the books online, the student interest was there.
● What’s your response to those who say that the world of education should be sheltered from the influence of advertising and marketing?
Doran: We understand that concern, and we’re very careful. We’re very respectful about how to do this. We do offer an ad-free version … or they can [opt for] one with ads. Obviously, the price reflects that. Where and how we’re putting the ads in, and whose ads are going in are all going through an academic filter.
● How do you convince authors to work with you?
Doran: It has been surprisingly accepted by the author community. They understand some things need to be changed. The authors we’ve signed so far are proven authors. We don’t try to make a case that they’re going to make as much money on the royalties side. We want them to know right up front that that’s probably not going to happen. They will get more units used and a larger market share.
● You’ve said you’re showing other publishers that this can work. Do you have more interest in licensing the service than in producing your own books?
Doran: We have a service that is called Textbook Media that includes straight licensing of the whole model that publishers can take to their sites. Down the road, that’s our end game. We knew we had to do our own publications to show that academics would use books with advertising, and that we could get advertising to come in. Eventually, the idea was to get away from that and provide a service for other publishers. We have this payload model and the freeload model. The payload model is obviously the one publishers are most interested in. That’s where the end-user pays a fee for a download. There is advertising in there. We’re playing with some systems where the publisher or the end user can calibrate how much advertising they’re willing to take. That would adjust the end-user price.
● What have other textbook publishers said about your business model?
Doran: Most of them have already contacted us. We’ve talked. We’ve made presentations. It’s a matter of how they execute the model. They’ll probably start with backlist or smaller titles …. It’ll be a walk-before-they-run scenario.
They know that their world is changing. … They’re smart and are staying ahead of the curve with pilot programs. We’ve already got four small publishers that are using us, and we’re talking to a couple of the majors right now. I suspect soon you’ll see more recognizable publishers. BB
- People:
- Peter Beisser
- Tom Doran
- Places:
- Minnesota