Why Was CourseSmart Offloaded?

This week’s news that the publishing educational joint venture CourseSmart has been acquired by Ingram’s Content Group should be not a surprise, but raises some interesting questions about publisher's joint ventures.

Some six years ago whilst speaking at the National Association of College Stores (NACS)  conference in Minneapolis, I was drawn to a cluster of delegates who were busy taking notes and sat apart from the delegates. I spoke to them afterwards and discovered that they were all from CourseSmart and they were obviously sent to press the delegates’ flesh. On being asked what the CourseSmart service was and what it wanted to be when it grew up I found I got different answers. Maybe that is where their problems lay. Later there were several rumours that some members of the joint venture want to go their own way. I also remember presenting to an industry group in the UK who were looking for an alternative to CourseSmart, but many were being reined in to supporting it by their larger brothers and sisters in the US. It is interesting that some members of the venture spread their bets and also backed competitive services as well as their own offers.

The big question is why publisher digital joint ventures either wither or get passed on? Maybe they feel that they are not core business, or that they don’t have the skill base, or maybe they bleed cash? Recently we have seen ventures such as Bookish and Anobii fail. Unlike others CourseSmart had the perfect parentage, access to the content, potential direct to market sales channel, yet it moves on.

CourseSmart was formed in 2007 by Pearson, Macmillan, Cengage Learning, John Wiley & Sons, McGraw-Hill Education and Pearson. It started off as a digital inspection service then quickly morphed into a providing digital textbooks in the higher education market and lately has offered its content and platform to a wider audience. It’s technology was driven be Pearson and some say that was probably the start of many of its internal challenges. Others will say that the base technology was restrictive and did not meet many of the market’s demands.  

In Ingram Content Group's Vital Source Technologies, Inc., it has probably found a good home and it clearly offers Ingram extended reach under the Vital Source platform as well as potential increased access to and opportunities with publisher digital distribution.

Ingram Reduce The Cost of Colour POD

POD has not lived up to its expectation. This has been down to a number of factors, but mainly the high cost of the print and the printers. It worked fine on high ticket works such as academic monographs, whose price was high enough to absorb the rise in print cost and still make a healthy margin, but for standard fiction and reference the price was often prohibitive. The ebook market then started to become the attractive option for the self publishing market and why produce physical books that may only clutter up the garage when you can produce a virtual one that may actually generate sales. Not many talked about the environmentally unfriendly aspects of POD, but they remain today. Finally there was the realisation that POD didn’t change the distribution model to one of ‘distribute and print’, but all too often remained wedded to the old ‘print and distribute’ one. Forget colour that was just another prohibitive cost hike.

Ingram Content Group, which has dominated the international POD market, has now announced a new “standard colour” cost reduction, which makes colour POD potentially more cost viable. They are significantly reducing the cost price of a standard 6x9 trade paperback from between $12 - $13.50 to $4-$5 on a single copy run and to $3 a copy on a short run of 500. A reduction of some 60%!

Ingram are achieving the price drop by switching to new high-speed inkjet technology which will initially go live in the US and then internationally next year. They claim that any drop in print quality through the new technology is very marginal and not noticeable and that colour could open up a new option to many.

So will this change herald in a new dawn for the POD market, or just reduce the cost of colour POD and potentially brighten up some of those greyscale editions. Colour certainly will be attractive and a 60% price reduction can’t be ignored, but POD is still not delivering it potential. After all this will not impact the existing POD business and text based works. POD remains a printer in a distribution hub and not a printer in a community one. The scale and scope of economics is still centralised and Ingram are merely replacing the printer of yesterday. It most definitely will not lead to hundreds of POD community print hubs and it probably will not impact the high end quality print market.   

  

POD remains a half way print house in a declining print market. 

Ingram Tightens its Belt

We have read recently about pay freezes, pay reductions and job losses in publishers and retailers and last week the Gannett Tennessee, La Vergne reported that as a result of fewer orders from booksellers, Ingram Book Co. has cut 64 jobs, including 34 from its headquarters warehouse in La Vergne and 30 in Roseburg, Oregon. some 500 people remain employed at the La Vergne warehouse, and 170 remain in Oregon. Although it is relatively easier to lay off and recruit warehouse resource to fit demand the move shows that demand has dropped across the supply chain which in turn indicates that more stock is standing still which in itself adds cost to all across the chain.