The Xplanation

Welcome to this morning’s Daily Research Update. Today’s themes are services, tablets, and mobile expectations. If you want more context for this research, take a look at our Education and Technology Trends for 2010. You may also be interested in our Weekly Research Index, or you can follow our live, daily research on our Current News page.

(Click here to see a simple listing of today’s suggested reading)

Some quick observations this morning.

1. Services will trump content in textbook publishing value

To date, publishers have placed a premium on the content itself. Yes, they have baked in the value of their editorial services, but what gets “sold” are the names of the authors, the superior collections of resources etc. Over the next 5-10 years, this model will flip completely and reach a point where content is inexpensive. New services for combining and managing content, however, along with services for assessing behavior related to content consumption, will be what we are willing to pay for. This is one of Lee Wilson’s points in his post on big textbook publishers. His conclusion is that this shift will have a huge benefit for small to medium sized publishers.

I believe that two forces, one blindingly obvious and one subtle, are causing an huge shift in the source of value and differentiation in the instructional materials market. First – the analog to digital transition is upon us and will shuffle the deck the same way it has in music, television, and the news business. Second – we are also seeing a quieter revolution in buying behavior as a deluge of information swamps inboxes. In the attention economy time is more important than money. The value of expertise is increasing at the same rate as the flow of information.

One of the reasons the “value” of content is changing is because the means of production is no longer an barrier for entry into the marketplace. A good example of this is J.A. Konrath’s piece on Huffington Post related to the ease of self-publishing e-books.

J.A. Konrath has an editorial on the Huffington Post in which he talks about how he used Amazon to publish the horror novel Draculas, that he, Blake Crouch, Jeff Strand, and F. Paul Wilson wrote together. Thanks to the self-publishing capabilities offered by Amazon, they were able to go from a completed book in September to a salable DRM-free e-book in time for Halloween. Not only were they able to go from manuscript to launch in three weeks, but they are able to split the 70% revenue on the $2.99 price and still earn almost as much in royalties as they each would on one of their own paperback novels. They were also able to throw in a whole bunch of bonus extras, supplements, and outtakes, because there were no paper costs to worry about.

2. Multi-purpose devices will win the education battle

I have both a Kindle e-reader and an iPad. I love each device in its own way, and take them with me on trips according to my needs. What is clear to me with regards to education is that the future is in tablets not e-readers. The former can do anything the latter can but the reverse is not true. Learning is about content but also about productivity. The dominance of tablet devices in this market is an easy call.

That said, e-readers are important in education because their popularity continues to drive a cultural move toward e-reading which, in turn, hastens that transition in educational publishing. So, it is not insignificant that both Nook and Kobo e-readers are soon to be sold at Wal-Mart. It is also important that, according to CNET sources, Barnes & Noble will announce a full-color e-reader next week.

Back to the iPad, according to a new Nielsen survey, users really do enjoy the device for consuming content.

Users said that they spent longer with the content they were reading, watching or listening to on the iPad versus the iPhone (the survey didn’t compare content consumption on either device to offline behavior or content consumed on other devices). Not surprisingly perhaps — given the iPad’s larger screen — users said they read books and watched video such as TV and movies on the device more than they do on the iPhone. Survey respondents said that they read books 39 percent of the time on the iPad, compared with just 13 percent of the time on the iPhone, and they watched TV shows 33 percent of the time on the larger device vs. just 11 percent of the time on the phone. The iPhone won out for content such as news (53 percent of the time, vs. 44 percent on the iPad) and music (51 percent of the time on the iPhone vs. 41 percent on the iPad).

3. Everything will meet our mobile expectations

One of the advantages inherent in “mobile” devices like smartphones, e-readers, and tablets is their instant-on capability. There is no wasted time waiting for these machines to book. That is also true of solid state netbooks and for the new MacBook Air. Ina Fried at CNET compared the new MacBook Air to a Windows 7 machine and found it zippier and a better user experience. This instant-on feature is a big part of consumer experience and expectation for future computing devices, and is another reason tablets will dominate the education market. Consumer expectation is mobility, connectivity, and instant access. Anything else is a dinosaur.

Suggested Reading

Big Textbook Publishers = Dinosaurs? :: The Education Business Blog

J.A. Konrath on Huffington Post: The ease of self-publishing e-books | TeleRead: Bring the E-Books Home

Source: New Nook is Android-based, full-color | Digital Media | CNET News

Both Nook and Kobo E-readers to Hit Walmart Shelves

Books and Video Win on the iPad, and Users Are Buying: Tech News

Mac vs. PC: The battle for ‘instant on’ (video) | CNET News