On January 13th, Packback was selected to give a presentation at the Making Information Pay for Higher Education segment of Digital Book World in New York City. Our presentation was unique in taking a qualitative look at current student attitudes toward higher education, which we have observed through an extensive "entrepreneurs in residence" program at esteemed research firm Shapiro & Raj. Keep in mind that this is a day where industry leaders gather, enjoy a cup of coffee in the morning, and then prepare for the ensuing eight hour onslaught of scattered statistics and "expert opinions", mostly around digital adoption. At one point during a morning BISG (Book Industry Study Group) data report I stopped and thought, "Wow. That's a lot to digest. It feels much simpler when you just talk to the students". Of course, all you have to do is quickly Google search "eTextbook adoption rates" and you'll see a flurry of articles, giving their claim to how digital adoption is progressing and pummeling similar data sets with often contradicting interpretations. One day you read about a new learning product or company that's "just killing it", and the next day you hear that they are on the verge of imploding. It's beginning to feel a bit like a jungle out here.
A few days after returning to Chicago, I had the great pleasure of speaking with an industry contact who has worked in education-related businesses since 1985. We were discussing some of the challenges that Packback will face during expansion. He gave me a great quote, in regards to some of the new educational technologies that have developed over the years:
"I have seen about a half a billion dollars in startup capital crash and die on the beach trying to penetrate this island called higher education"
That struck me as a rather peculiar, yet accurate description of the industry. It wouldn't have been out of place for him to include additional imagery of a brick wall surrounding what seemed to to be a calm and serene island, obscuring a rather frenetic jungle inside. For the sake of discussion, let's assume this half a billion dollars' worth of new entrants had an 'in' with the brick wall gate keepers. Why is all that innovative capital crashing and dying on the beach? This resistance is essentially what we sought to explain, from a native student perspective, to the industry leaders in NYC.
One of the many lessons we learned by working hand in hand with a team of PhD research experts the past eleven months is that you can't simply infiltrate the (paper) island with new technologies and hope to effectuate change. This island was built up over hundreds of years, with massive infrastructure cementing the ways of old in place. But here's what's exciting: for the first time in history, the industry is building a new (digital) island. Interactive homework solutions, super-adaptive learning technologies, video-based learning, and of course the heralded MOOCs -these are all the ingredients for a ground breaking new educational landscape. It's a bright future, if we can make it to the digital frontier. However, what we've noticed in launching Packback is that the middle ground is scarce. In other words, the industry lacks a sufficient bridge between the paper island and the digital island.
It costs money to build the digital island. A lot of it. McGraw-Hill, for example, one of the titans of the old and pioneering leaders of the new island, recently unloaded $2 billion into a state of the art R&D facility in Boston. This is awesome stuff! The leading learning companies are investing some serious cash and expertise into building the new digital island which should absolutely make for an exciting future in education. Here's the catch: the lifeblood of these developments (and their parenting companies, for that matter) still relies significantly upon a healthy stream of paper-driven revenue to pump resources into the future technologies. Once the technologies are developed, it's also presumed that there will be a ready and eager audience of tech-savvy students grasping at the chance to utilize, and more importantly, pay for these next-gen learning products. Ehh not so fast, if you actually ask the students.
With strict regards to surviving academia, today's college students remain natives of the old paper island, and thus they rely heavily on the paper format when using a textbook to prepare for exams. The likes of adaptive learning products and co. hold unknown and thus unproven value to a student who "learned how to learn" on paper. Historically, print textbooks alone provided a sufficient revenue stream for the learning companies, but in modern day the fruits of their labor no longer stay ripe very long. In other words, the moment a new textbook edition hits the shelves, it's sucked into the "secondary market" (Amazon, Chegg, etc.). After 12 months, that poor ISBN is outcasted as "backlist", a delinquent product that scarcely produces new revenue for it's creators while "used book" prices come crashing downward in the wildly competitive jungle of a secondary market.
While the "experts" study it, the students live in this jungle and have intuitively adapted to it's intricacies. In the Packback presentation, we highlighted three direct quotes from our Shapiro & Raj focus groups which capture the pulse of this generation of students and outlines the industry's current challenges:
"I typically spend a few hours surfing online, searching for ways to save money on my books"
"It's frustrating! I buy all of these expensive textbooks and then end up barely using some of them"
And then the digital haymaker…
"I'm old school. Talk to my ten year old brother; he'll use digital textbooks"
These sentiments accumulate to a pretty horrifying situation for the major learning companies investing so heavily into developing the digital future. Students are accustomed to memorizing content in preparation for a test on paper products. As previously mentioned, digital adoption requires a shift in behavior. They're also accustomed to accessing a world wide web of pricing options for the textbook and then picking the most attractive one (Spoiler Alert: the standard eTextbook rarely wins the pricing battle). Given the breadth of available options, and decreasing reliance on frequent textbook use in the classroom, students today have greater leverage than ever before. More than any other factor, it is the student preferences and behaviors that are going to drive continued innovation.
So how do the learning companies enlist early settlers to their brave new digital frontier? The old paper island still holds the majority of the 20 million student population, and we're sending (often reluctant) pilgrims over to the new digital island in the equivalent of row boats. Homework platforms, super-adaptive tech bundles, and University-adoption eTextbook programs are all wonderful ways to rope in large groups to hop on the boat over to the new island. The problem is, sans a professor or university administrator to drive the boat, nobody hops in. So how do we do it? How do we convince the students to emigrate naturally?
…Well what if there was a bridge? A way for the average paper-prone student to simply walk over to the new island, get their feet warm in the sand, and make their own decision as to whether or not the digital landscape makes for a suitable new learning environment. Sure, it would have to require pricing incentives and a degree of suitability to the current student behaviors, but the long term effects of demonstrating value in the digital products are immensely beneficial. Oh and what if, while traveling this bridge, the students' precious coins were being shipped back to the innovative learning companies as opposed to the barbaric tribes of used book peddlers? Well, that's precisely Packback's role in this thrilling educational revolution. We're building the bridge that allows, and incentivizes, students to emigrate freely to the new digital island.
To borrow a nugget from Amazon, the Mongol-esque tribe that stripped the old island nearly bare for the learning companies and thus recieved a day's worth of attention at Digital Book World: "Steady progress toward seemingly impossible goals will win the day. Setbacks are temporary. Naysayers are best ignored". It's time to get moving, we'll meet you at the bridge.
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