Executive Director’s Message: Developing sustainable textbook business models

Textbooks have a very different challenge from journals in converting to online businesses. First, readers have not embraced longer works online quite as enthusiastically as they adopted shorter journal articles. Print continues to have strong appeal as a reading format.

Another critical barrier to developing sustainable online textbook business models is working out the complexities of author royalties.

We have entered a new phase of experimentation with textbook business models. One major textbook publisher recently introduced a digital platform providing student access to all eligible textbooks in the publisher’s portfolio for a flat rental fee per semester. This is but one version of a broader strategy called “inclusive access” (see Joe Esposito’s excellent post on this in SSP’s Scholarly Kitchen blog from March of last year). Inclusive access plans enable institutions to negotiate for campus-wide access to titles for a student fee that can be a fraction of the current average cost of textbooks each semester.

There are serious concerns among authors – especially of works already published – about how these new plans will impact royalties. Are authors paid a small share of every student fee collected?…every time their work gets used?…or only when the work is adopted for a particular course? It is unknown how online royalties accounting can be audited, or whether author royalties for online access can remain at least comparable to print royalties.

Even so, experimentation with business models is necessary. Textbook publishing must adapt to both the threats and opportunities presented by the digital environment.

The business case for aggregated fees rests on expanding market share and increasing the percentage of students who purchase access digitally. Inclusive access and other strategies have already reduced student average spending per semester and per book in recent years, according to the Association of American Publishers (AAP), and the number of students who are getting by without purchasing a textbook, or only buying used books is still apparently very high today (see http://bit.ly/2ivJwlY).

Non-sales and used copy sales do not contribute anything to author or publisher royalties. Changing that dynamic might stabilize author royalties even if the royalty ‘per unit’ is lower. But there are risks for authors in the new arrangements, and the rollout of publisher business model experiments has so far been shrouded in secrecy. Publishers who want to act as partners with authors will take steps to inform them and address their questions before experimental models are presented to the market. And authors, as key stakeholders, should remain open minded to new models, but express their concerns and ideas pro-actively with their publishers whenever possible.

~ Michael Spinella, TAA Executive Director