Amazon.com has launched a textbook rental service, allowing US students to borrow print editions for a school term at up to 70 per cent off the price of new titles, but the education industry is expecting the growth of rentals to slow.
Book Industry Study Group research found that textbook rentals rose last year from 8 per cent of the market to 11 per cent, with a corresponding drop in new textbook sales, from 59 per cent to 55 per cent. There is also a sizeable second-hand market in textbooks.
Student Monitor, another research group, put rentals’ penetration of the print textbook market at 13 per cent last year. Cengage, one of the largest US college publishers, predicted that this could double to 26 per cent by 2015 before flattening out.
However, Cengage also forecast that rentals’ impact on higher education revenues would fall from 5.2 per cent this year to just 0.8 per cent by 2015. “We’re beginning to see textbook rentals peak,” said Laura Ricci of Outsell, a publishing research firm.
This is because publishers are increasingly using technology to enrich traditional textbooks, and students are finding it easier to sell their used texts online.
“Users are beginning to expect more from textbook content [than] just words on a page,” she said, pointing to the rise of interactive testing technology and other “full course solutions” as publishers such as Pearson, owner of the Financial Times, broaden their business models.
Existing textbook rental companies such as Chegg and BookRenter.com are diversifying, Ms Ricci added, saying they need not be threatened by Amazon.
Mehdi Maghsoodnia, chief executive of BookRenter.com, welcomed Amazon’s move, saying it would increase awareness of textbook rental services. BookRenter.com and Chegg offer similar discounts to Amazon.
“It’s a recognition that the reality is that 99 per cent of the educational market continues to use physical texts,” he said: “To help students, given the increase in tuition fees, you have to lower the cost of textbooks.”
According to the National Association of College Stores, US students spend on average $655 a year on required course materials. Multiplied by roughly 20m students in college, that suggests a $13bn market, BookRenter noted.
Mr Maghsoodnia said by some estimates rental could grow to be half of the market by volume, although such a shift would reduce the overall market’s value in dollar terms.
Several publishers have worked with print and digital rental services. McGraw-Hill and Chegg announced a partnership in 2009, and Houghton Mifflin Harcourt announced a deal on Tuesday with Kno, an education software company, offering year-long digital rentals of school texts for $9.99 or less per book.
Many college students still find that selling their print textbooks once they have finished with them is cheaper than buying or renting their digital equivalents, Outsell reported this year.