By Janet Novack It's not just rising college tuition and room and board charges. It's all those incidentals, from student activity and health fees to lab fees and books that are turning higher education into such a financial burden. According to the College Board's latest Trends In College Pricing report, in 2011-2012, books and supplies cost students at four year public colleges an average of $1,168 and at private non-profit four-year colleges an average of $1,213. Nor is this a new problem. A 2005 report by Congress' Government Accountability Office found that from 1986 through2004, text book prices nearly tripled, rising at twice the rate of inflation. So I was intrigued when a representative of McGraw-Hill e-mailed that Tom Malek, an executive from the company's higher ed division wanted to write a guest post about a plan to bring down those costs with e-books. Full disclosure: As the parent of two college students, I'm not convinced by the solution Malek offers, which would force students to buy new e-books, rather than allowing them to buy used (or new) paper texts. Neither is my daughter, who conscientiously scouts for deals (and even gets free hand-me-downs) before buying pricey science text books. While she would be lost without her iPhone and MacBook, she prefers to do her heavy duty reading and studying on dead trees---as I know I do. Still, students and parents alike should pay attention to what Malek has to say, since his model may be soon tried out at a university near and dear to your pocketbook.Solving the E-book Problem in Higher EducationBy Tom Malek, Vice President of Learning Solutions for McGraw-Hill Higher EducationFor some time now, e-books have been the presumed future of higher education. The reasons why have always been pretty apparent: they have the potential to save students money, they're a lot easier to carry around, and because today's students seem to prefer digital to print when it comes to just about everything else, it followed that they'd feel the same way about textbooks.At first it was the growing popularity of traditional e-readers â¿¿ your Kindles, your Nooks â¿¿ that was supposed to drive this trend. Then along came the iPad, which was adopted in astronomically large numbers by consumers and students alike and offered the promise of a new kind of interactive reading experience. Last month saw one of the biggest bets yet on e-books, when Microsoft announced that it will invest $300 million in a joint venture with Barnes & Noble that includes not only the bookseller's Nook e-reader and digital division, but also it college bookstores. Barnes & Noble valued the venture at $1.7 billion, which is striking when you consider that Barnes & Noble's own market cap was less than $900 million at the time of the announcement.But a funny thing happened on the way to the e-book revolution: students decided to stay with print. E-book adoption among college students has remained consistently, almost puzzlingly low. Studies currently show that about 3 percent of college students are purchasing e-books. If today's students are truly digital natives, and if e-books offer so much value to students, why haven't we seen more uptake?For one, when it comes to studying, students have shown a strong preference for the familiar, and are often reluctant to give up print â¿¿ something they've been accustomed to their entire lives. It's also a problem of perception. Students who are unaware of how e-books can enhance the learning experience are less likely to adopt, even if it means spending a few extra dollars.This is where price becomes important. Companies, including my own, simply have not been able to deliver e-books at a price that's low enough to entice college students to make the switch from print to digital. There are a number of factors affecting the price of e-books, but the long and the short of why they're not priced lower is that the costs that are saved by shifting from print to digital â¿¿ things like paper, printing and warehousing â¿¿ represent only a fraction of what it costs to produce a book. The highest costs â¿¿ research, paying our authors â¿¿ don't change no matter what form the final book takes. To date, e-books have offered students some cost savings; those savings just haven't been enough to get them to put down their more familiar print textbook and switch over to digital. When you consider all the ways that e-books can help students learn more effectively, this becomes a much larger problem.Recently, however, publishers have begun developing innovative new models that allow them to provide e-books to students more affordably. In one example, McGraw-Hill has partnered with several colleges and their bookstores to ensure that all students have access to the learning materials for their courses at a price that's substantially lower than what they're used to paying â¿¿ as much as 60% less than a print textbook. This is highly competitive with the price of a used book and provides students with the many other benefits of e-books: portability, instantaneous access to course material on the first day of class, and assurance that they're using the right edition. It also represents a significant savings for students: The College Board has reported that college students, on average, spend about $1,000 a year on textbooks. Some studies have shown that up to one-third of students (or more) opt to not purchase a textbook for a course they're taking for the purpose of saving money, which clearly can have an adverse effect on a student's academic performance.Through these new models, we're finally getting e-books into the hands of a large number of students â¿¿ and helping them save money in the process. Here's a look at a few keys to how these models work.100% class participationThe story of how a textbook finds its way into the hands of a student reveals a lot about the e-book pricing problem. Typically, a professor or school decides to adopt a textbook for a course, the university bookstore stocks print and digital copies of that book, and then students purchase the book from the bookstore. While some students purchase an original version of the text â¿¿ either in print or digital format â¿¿ some opt to buy a used print book or to not buy the book at all. These latter two options, of course, yield no revenue for publishers, thereby making it more difficult to offer e-books at lower prices.What we've recently found is that by working with schools to ensure 100% class participation in an e-book purchase â¿¿ that is, making sure that all students in a particular course buy the book selected by the professor or school for that course â¿¿ publishers can afford to offer e-books at a dramatic discount. While it's true that some students might appreciate the freedom to not buy materials for their course, most professors prefer to know that all of their students are equipped with the assigned materials needed to succeed in their course. And the vast majority of students â¿¿ including those who otherwise would have purchased a used book â¿¿ benefit from lower prices across the board.Under this model, students enrolled in participating classes are automatically billed for the e-books through their bursar accounts; however, to make sure that only students who stick with a course are charged for the e-book, billing is not applied until after the add/drop period ends. McGraw-Hill has developed successful pilots using this model with Indiana University and five other schools: the University of California at Berkeley, Cornell University, the University of Minnesota, the University of Virginia, and the University of Wisconsin. This fall, McGraw-Hill will also be partnering with the University of Minnesota bookstores to offer deep discounts to students on e-texts, representing the first time that a publisher has partnered directly with a campus bookstore to increase affordability for students.In the pilots, feedback has been highly positive from faculty, who are happy to know that all of the students enrolled in their classes are equipped with course materials, and students, who get access to e-books and all the advantages they provide (portability, integration with digital learning systems) at a price that's in line with what they'd pay for a used print book.Partnering with university bookstoresIt's easy to think of the university bookstore as simply a place where students go to buy toothpaste and college sweatshirts, but these bookstores play an important role in helping to make e-books more affordable for large numbers of college students.While it's often assumed that a university and its bookstore are one in the same, they're most often separate entities, and it's the bookstore that maintains the very valuable information of which students, and how many, are actually purchasing books for their courses. By partnering with university bookstores â¿¿ which also have the ability to make purchases on behalf of students and connect those purchases to students' bursar bills â¿¿ schools and publishers are able to facilitate the type of bulk e-book purchase that can lower prices for students.Connection to assessment and adaptive capabilities Great content is the cornerstone of any learning experience, but as we've started to realize the benefit of assessment and advanced digital learning tools, like super-adaptive technology, which integrate directly with e-books, more and more colleges and universities are insisting that they be included in any large-scale purchasing deal.On college campuses today, e-books are delivered through online platforms that house all of the course materials that a student needs for class, including his or her syllabus, homework assignments, grades, and study tools that help students understand what they know and don't know and how they can improve. Effectiveness studies of McGraw-Hill Connect (our centralized online learning platform) and LearnSmart (our digital study tool) have shown these programs to increase student performance across a number of key metrics, including grades, test scores and readiness for class.The ability of education companies to offer these technologies, which help professors personalize the learning experience and drive student achievement, along with e-books at a price that's still affordable to students, is another critical part of this new model.Looking aheadWhile it's taken significant advancements in technology to make the idea of an e-book even possible, it's taken similar amount of innovation on the part of many to bring them into the hands of students. Publishers and bookstores have done much to make this happen by switching to more flexible business models, but this shift really would not be possible without universities recognizing the incredible value that e-books can provide. By working together, we're making progress toward a goal that's far more important than driving adoption of e-books: making college more affordable and improving student performance. The e-book revolution still it's just starting later than many of us thought.Tom Malek is Vice President of Learning Solutions for McGraw-Hill Higher EducationSee also: The College Graduate's Guide To Managing Money And Debt
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