Pluses and Minuses in Apple’s iBooks 2 Textbook Equation

Apple s (NASDAQ: AAPL ) announcement this week of the iBooks 2, iBooks Author,
and iTunes U apps may not have garnered the sort of consumer mania that
typically comes with the announcement of a new iPhone, but make no mistake: It
was a big deal. Research group BookStats and the Association of American
Publishers wont release 2011 sales figures until later in 2012, but studies
released last fall reiterated the earning potential of the market.
Higher-education textbook sales grew 23% over the past three years, totaling
$4.5 billion last year. Is Apple about to add yet another multibillion-dollar
revenue stream to its stable? I cant say Im worried, says at least one publisher
in the field. A study conducted last year by social-learning platform Xplana
projected that digital textbook sales would total $1.5 billion by 2015. That
was, of course, before Apple decided with Pearson (NYSE: PSO ), McGraw-Hill
(NYSE: MHP ), and other publishing heavyweights to take on the market. iBooks 2,
released on Thursday, already supports eight interactive iPad textbooks sold
through Apples iBookstore. Instructors using the iPad in class also have access
to iTunes U, a course management app that can be used for structuring classes
and assignments. Both are complimented by iBooks Author, an app for corporate,
independent, and individual publishers alike, easing the process of creating
e-books for Apples platforms. Based on Apples past success with media
initiatives like iTunes, its not unreasonable to think that Xplanas $1.5 billion
estimate is low-balling it. Textbook production: not rocket science, but pretty
close Will iBooks Author self-published textbooks cut into higher-education
sales? A production editor with a prominent independent publisher serving the
higher-education market expressed skepticism to InvestorPlace that that would be
the case. Unlike trade, textbooks tend to be insulated from self-publishing due
to the sheer number of eyes and minds required to craft an informative, visually
attractive book in any field," this editor says. "Theres nothing to stop
motivated professors or graduate students from collaborating on a self-published
textbook, but if professors and graduate students had the time and motivation
required to do so, we wouldnt be in business in the first place. The iPads
infiltration of the classroom does represent a potent opportunity for larger
publishers, says the production editor, adding: In the past decade, the book
itself has become less