It’s crunch time for ELT publishers. There are a few more years left for the traditional ELT publishing business to stagger on, possibly even quite profitably for some. But we all know it’s on the way out, as evidenced by the attempts – with varying degrees of conviction – of the existing players to turn their businesses into ones capable of surviving and thriving in a world populated by rapidly changing student expectations and super-ambitious and rapacious EdTech start-ups who will very happily destroy the cosy world of ELT.
We’ve seen bold moves from Pearson, and turbulence elsewhere. And we haven’t yet seen the market taken over by the EdTech guys, so there might still be time. It’s a common trope that ELT is a conservative and slow-moving business, which may be true – but change now is required in order to be relevant in a few years time. The conservative end of the market has your backlist to keep them happy for a while yet. So there’s no need to kill off existing businesses – but failing to build the new one is surely suicide. So, what to do?
1. Bring in digital skills
How is it remotely conceivable that you can build and run a successful digital business with a team whose experience and core skill lies in commissioning, developing, manufacturing and selling books? Really, what’s that got to do with creating amazing apps or online learning learning experiences? Not a lot. There’s still plenty of need for a lot of the things ELT publishers are good at – ELT content expertise, market knowledge, contacts, project management. But how can you seriously expect to build a digital business without people who’ve got experience of doing that?
So, if you want to succeed in digital, make sure your team – up to the most senior levels – includes those who have actually had success in digital. That probably means people from outside ELT.
2. Make content free (or at least, much cheaper)
Content is becoming a commodity. There’s a lot of it about, and it’s increasingly not the key factor in decisions about which course to buy. Uncomfortable news, and those who create and sell content will rail against the dying of the light – but that won’t change anything. This has happened in every industry that’s felt the full force of the digital revolution – think music, newspapers, ebooks from trade publishers. These things sell for money, but not the £20+ that ELT books go for. As ELT publishers rush towards ebooks and apps (because that’s what the markets say they want), and try to sell direct to students, they’re hitting the uncomfortable truth that charging £20 for an app or access to an online resource is hard work. Yet the same quantity and quality of content is demanded, as well as expensive-to-create functionality.
The commoditisation of content doesn’t mean content owners have nothing to sell, though. And this is a gradual thing, so content will still sell for a while longer. But look to build revenue from other things, like testing, teacher training, programme design, platforms, provision of teachers.
Imagine the disruptive impact on the ELT market if a publisher was to make a high quality course available for free. Why would anyone use any other course? The challenge is how to make that a profitable enterprise. Everyone working on how to crack this one? No? Get moving!
3. Find or buy a decent technology partner
It seems like all of the really exciting technology in education is coming from hi-tech startups, not from publishers, schools or established LMS providers. Publishers are building their own platforms or partnering with companies like Blackboard or Desire2Learn. OK, fine, but how’s that going to shake things up? Technology continues to be a major weakness for all ELT publishers. That leaves them wide open to attack from people who have world-class technology. Work with these people – or buy them – before it’s too late. Have you ever seen an online ELT product that looked so amazing you’d want to invest your own money in it? Or that would make Apple or Google jealous?
4. Sell direct to teachers and students
In some cases, distributors are still useful – in closed markets, or where they add real value. In the majority of cases, though, they’re just the middle-man scooping off half of the revenue and making it impossible to charge the lower prices that consumers expect for digital content. Unless a distributor has an essential digital platform with huge market reach (like Apple), then they’re not worth 30% or more of your money. Selling direct, of course, isn’t something you have much experience of doing if you’re an ELT publisher. And it’s not an easy thing to start doing. Get in some people who have been there and done it, maybe in other industries.
5. Be agile
To paraphrase the mythical Darwin quote, it’s not the strongest that survive, but the most adaptable. Things are changing fast. Everything you know may be wrong. Everything I’ve just written may be wrong – I’m sure at least some if it is. This is not the kind of environment that supports 3 or 5 year publishing plans. Or organisational structures that prevent close-knit project teams appearing as needed. Or processes that mean it takes years to develop products.
6. Set up a new digital-only business
What if all of the above doesn’t work? Well, hopefully, you’ll have hedged your bets by setting up an entirely separate digital-only business where the first 5 points don’t even need to be said. How feasible is it really to add digital experience throughout the organisation, experiment with new business models which can turn the commoditisation of content into an opportunity, find or buy top class tech, radically change distribution models and implement new agile processes and an agile mentality? Seems a bit like trying to change the engine and tyres on your car at 80mph.
Photo credit: minifig / Foter.com / CC BY-NC-SA
Great post, Laurie. Ticks all the boxes.
Hi Laurie,
It’s a spirited opinion piece but these are some pretty bold assertions. Even though you CYA with “Everything I’ve just written may be wrong – I’m sure at least some if it is”, it’s strong on emotion but weak on evidence.
It puts in mind of something a market analyst once wrote: “If you’re an astute observer, your portfolio will reflect what’s new and exciting and dynamic …”.
That was in 1999 and the new, exciting and dynamic companies he was referring to were the dot.coms – this was obviously before the precipitous drop in share value of just those companies in the following year. Although companies like Amazon.com, famously, not only survived after the bubble burst but are now also hugely successful – it’s nevertheless a handy reminder that attempts to scare people into believing that either they must become an early adopter or die.
I enjoyed the article but as well as a lack of any numbers or examples to back up your claims I also noticed that you seem to talk about ELT as if it were a homogenous whole. Even when you refer to “[t]he conservative end of the market [which] has your backlist to keep them happy for a while yet” it’s implied that the latter group are merely late-adopters who will eventually catch up with the vanguard.
There is a huge diversity within ‘ELT’, a fact which has largely been obscured over the years having been hidden under the weight of all those voluminous piles of course books. In fact, if in the past the ELT market has seemed to be more homogenous than it is in actual fact, it’s largely the result of an illusion created by the big global publishers.
EdTech is exposing some of that actually existing diversity that’s always been out there but it’s not doing so – or likely to do so – in any uniform way. While the same print coursebook can be shipped and sold in Hong Kong, Thailand, Mexico and Germany the same cannot be said of digital content because the latter will be limited by national infrastructure e.g. – decent coverage, access and speed of broadband.
And it’s because of that diversity that it will take some serious convincing to demonstrate that the whole of ELT – en masse – is inevitably going to shift, oil-tanker like, in the same digital direction. Certainly I think that there are good reasons to think that print will last much longer in some markets, and some segments within those markets, for quite some time yet.
For instance, I’m writing this from a library surrounded by students aged 18-20 something virtually all of whom have thick, fat course textbooks which they are reading from – and that’s in the UK(!).
(It would be interesting to see what would happen if all the major global publishers effectively imposed digitalization onto schools by ditching all their print product and only offering eBooks – would they see the total available market shrink in response and thereby create opportunities for local print publishers to succeed?)
it’s nevertheless a handy reminder that attempts to scare people into believing that either they must become an early adopter or die [may not be the way to go]
Hi! This is really about putting things in place now in order to have a chance of being relevant in a few years time. Obviously, there’s huge variation in the pace of change between different countries, institution types, age groups etc – and print will be around for a long time yet. But digital is growing very fast as a proportion of the ELT publishing business (from basically nothing only 5 years ago or so). All ELT publishers would say that digital is their future (whether or not you think they’re correct to think that) – and that being the case, they need to change how they operate in order to have any hope of succeeding against companies which have only ever done digital. If you try to run a digital content business like a print book business, I don’t think you’re likely to succeed.
Very good point about the diversity of ELT (and yes it is easy from within a publishing company to think of ‘ELT’ as a single entity) – I’ve said before here that one of the really promising things about EdTech and the possible fragmentation of the ELT publishing industry is that it could bring an end to the era of Headway and English File clones posing as something new.
Hi Laurie,
Thanks for getting back to me on my comments and of course I do appreciate that you can’t write an opinion piece without painting in very broad brush strokes.
Just for the record, I’m not denying the impact that Digital is having on the ELT Print Publishers, that would be patently absurd, but your opening line “It’s crunch time for ELT publishers. There are a few more years left for the traditional ELT publishing business to stagger on …” is a bit of an eye-brow raiser compared to the calmer and more reasonable: “Obviously, there’s huge variation in the pace of change between different countries, institution types, age groups etc – and print will be around for a long time yet” ; – )
I completely agree about the Fragmentation element – for example, you used to be able to buy boxes of a 1,000 L1/L2 Vocabulary Flash Cards for about £10-15 but a judicious use of Anki (free) + an online newspaper (free) + online CALD and/or Google translate (both free) has made producing those boxes of Flash Cards redundant.
I think one major challenge for Digital will be to see just how many discrete ‘particles’ they can distinguish from one another across the spectrum of processes in learning and teaching a foreign language and then finding a way to create an intuitive product for each of those discrete particles.
The other challenge – that maybe you’ve already discussed in another post – seems to be how do non-traditional EdTech start-ups with no previous ELT knowledge plan to access the markets (or are they hoping the markets will select themselves by scouring the web for relevant key words?)
Why did you leave schools off of #4? Was it on purpose? It seems to me that one way way you can charge serious money for your digital content is by wrapping it up in schools. Another thought is that schools, not bookstores, are the ultimate middle-man between ELT digital publishers and students. This all leads to the conclusion that when books are killed independent ELT bookstores will probably die a slow death. It would seem that independent bookstores would be the first ones (after writers) to face the chopping block. Any canaries dieing here?
Hi Michael – do you mean publishers should own/become schools (as Pearson are doing, for example)? Or that they should sell direct to schools? You’re right that schools are the ultimate middle man between publishers and students – and that’s why publishers are so fixated on the needs of schools and teachers as opposed to those of students.
Good question about ELT bookstores – you would certainly expect them to be the first to struggle unless they can find new ways to add value. The precedent is certainly there in bookshops in general (usually blamed on Amazon) – I’m not sure whether there are yet clear signs of it happening in ELT.
Actually, should is a word I try to stay away from in a discussion like this. But I am wondering if it is a three-part toss up for publishers as they move away from books (and international book sales). Either…
1. Buy or build your own schools
2. Get really close to schools owned by others.
3. Directly approach students.
And I also think if you choose 1 or 3 (or 1 and 3) it will make it much more difficult to also do 2. I also think if you are smart and understand the market you can do both 1 and 3 using schools as a way to get closer to students. I think that winners will take a “lifetime” view of a student and use schools to create a long-term relationship (think Disney).
This all assumes that learning technology reaches some kind of parity at some point that is resistant to a well-funded breakthrough (that can be patented). If a well-funded breakthrough happens then all bets are off and probably #3 takes the front seat.
In all of this I wonder who are the teachers “natural” long-term friends or allies (publishers wanting to go direct to students or highly independent schools).
Really timely, useful, and helpful!
Really timely, useful, and helpful!
Laurie,
Süper post – hits all the key soft spots in the publishing world. It really is time for publishers to wake up and smell….the 3D printing ink 😉
The one other (fundamental) call I would make – perhaps before all the wonderful points you have noted is:
– Put student LEARNing and success at the heart of your decision-making!
The vast majority of publishers (despite what they say in their glossy brochures and on their websites) are still all about TEACHing & Content DELIVERY.
LEARNing can not be “delivered” – ever! Even when we build in “digital skills”, engage with decent technology partners and get more “agile” in out thunking 😉
Keep up the great work!
T..
Cheers Tony. Excellent point! Publishers are teacher and school focussed because they mostly sell to schools and teachers and not to learners. And, yes, the idea of learning being ‘delivered’… Check out the very nice video on Pearson ELT’s new home page. Very nice apart from the bit that says “We believe in learning. All kinds of learning. For all kinds of people. Delivered in a personal style.”
Hi! This is really about putting things in place now in order to have a chance of being relevant in a few years time. Obviously, there’s huge variation in the pace of change between different countries, institution types, age groups etc – and print will be around for a long time yet. But digital is growing very fast as a proportion of the ELT publishing business (from basically nothing only 5 years ago or so). All ELT publishers would say that digital is their future (whether or not you think they’re correct to think that) – and that being the case, they need to change how they operate in order to have any hope of succeeding against companies which have only ever done digital. If you try to run a digital content business like a print book business, I don’t think you’re likely to succeed.
Very good point about the diversity of ELT (and yes it is easy from within a publishing company to think of ‘ELT’ as a single entity) – I’ve said before here that one of the really promising things about EdTech and the possible fragmentation of the ELT publishing industry is that it could bring an end to the era of Headway and English File clones posing as something new.