Apple Schools Amazon

Students, please crack open your iPads!

Textbook publishers are gearing up for the release of Apple's (Nasdaq: AAPL  ) iPad, according to this morning's Wall Street Journal.

Makers of textbooks and study guides -- including Pearson (NYSE: PSO  ) , McGraw-Hill (NYSE: MHP  ) , Washington Post's (NYSE: WPO  ) Kaplan, and Houghton Mifflin Harcourt -- have entered into deals with ScrollMotion to bring their costly and hefty reads to the iPad.

It's not as if Amazon.com (Nasdaq: AMZN  ) is ignoring this juicy market. It has been offered as a textbook alternative in some colleges since 2008. A few campuses backed away from the Kindle recently -- when blind student organizations sued -- but the real drawback for Amazon's reader as a textbook replacement is its inability to render the colorful graphics found in many schoolbooks.

Barnes & Noble's (NYSE: BKS  ) nook offers a small full-color screen, but the iPad seems to be the perfect fit to bring colorful textbooks to life.

We'll know soon enough. Apple expects to begin shipping iPads next month. Brisk sales over the next few months would give colleges every incentive to warm up to digital textbooks before the fall semester rolls around.

Amazon can't let this happen. Losing out on the sale of physical books, where it can undercut the campus bookstore, would sting even more if the sales went through Apple's virtual storefront instead.

The iPad can succeed as a multipurpose device without eating into Kindle's dominance, but the moment that Apple's gadget is seen by influential high school and college kids as the digital reader of choice, it will be hard for Amazon to get that mojo back.

If Apple moves to the head of the class, what becomes of Oprah's teacher's pet?

Who will champion the inevitable digital textbook revolution? Share your thoughts in the comment box below.

Apple and Amazon.com are Motley Fool Stock Advisor selections. Pearson is a Motley Fool Income Investor recommendation. Try any of our Foolish newsletter services, free for 30 days.

Longtime Fool contributor Rick Munarriz has been a Kindle owner since 2008. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He does not own shares in any of the companies in this story. The Fool has a disclosure policy.


Read/Post Comments (12) | Recommend This Article (9)

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 03, 2010, at 2:26 PM, lookcafeelmn wrote:

    saw this one coming 10 miles down the road. here's the other interesting bit. what's amazon going to do? not like they have an equally competitive product waiting in the wings to quick launch.

    taking it a step further...here's goog's problem. they can build the best tablet in the world for a better price than aapl. but they don't have the apps. that's the secret sauce here...all those apps. plus, let's face it, aapl can actually service their hardware and troubleshoot. goog has an 800 number for nexus one. maybe with their tablet you can go to the geeksquad? that's their best play.

  • Report this Comment On February 03, 2010, at 2:31 PM, StudentMonitor wrote:

    "If they sell briskly over the next few months it will give colleges every incentive to warm up to digital textbooks before the fall semester rolls around".

    The adoption/purchase of an eTextbook as an alternative to traditional, bound printed textbooks or renting textbooks is driven by the end user and the real end user is the student, not the institution.

  • Report this Comment On February 03, 2010, at 3:03 PM, smangano wrote:

    It is a big stretch to say that the iPad is going to be a good e-Reader. The screen technology that allows it to offer color is offset but much lower readability. When many people start saying that they can comfortably read 100+pages on an iPad then, yes, Amazon is toast.

  • Report this Comment On February 03, 2010, at 3:10 PM, cahhorn wrote:

    As a current grad student, I am unsure as to how many students are really going to jump onto the ebook bandwagon for text books. I do not like carrying 20 lbs of books around all day, but I do like being able to highlight and stick notes on pages. Sure, the iPad will likely have an app for this, but I believe that the tactile appeal of printed texts will endure for at least the next 5 years.

    It is worth mentioning that everyone in my program carries a laptop around already. We have the capability to download pdf’s of much our reading and yet I (and the majority of my peers) still choose to pay a premium for course packets and texts. Lots of people are going to buy the iPad, but it is not going to change the way students read and learn; it is not the next iPod.

    That being said, I am still bullish on Apple. Their computer business continues to expand and their customer loyalty boarders on cultish.

    Keep an eye out for growth in other areas of the business. Perhaps the more important shift in higher education has been schools’ growing incorporation of expensive Apple computers into campus computer labs to satisfy hipster students. My college went from all PC to a 50/50 mix over the holiday. We have several hundred computers on campus and there are over 4300 colleges and universities in the US. I am not a math major, but those numbers seem to add up quickly.

  • Report this Comment On February 03, 2010, at 3:10 PM, touli wrote:

    I would much rather carry an iPad than a 20 to 30 pound book bag, or back pack. Never mind the fact that one semester of books can be over $500, which is about the cost of the iPad.

  • Report this Comment On February 03, 2010, at 3:33 PM, demodave wrote:

    I think Apple will win this one. I can see tremendous advantages in the sciences to having an "active" screen (as opposed to a still screen like the Kindle - where eInk doesn't have the speed/flexibility to move well). Imagine a textbook: *showing* the math of acceleration both in equations and in pictures; *actively* demonstrating changes to sine wave frequency or amplitude or interference patterns; peeling back images of layers of muscles in the body; etc, etc. Apple has had a very good relationship with academia for years. I think the iPad will only improve that relationship. And I think Apple will accumulate content for those purposes far batter and faster than competitors.

    That said, I was talking with a Kindle user who loved his Kindle just yesterday - a model of the business traveler cited elsewhere who can take books with him. I suspect that much of that audience will stay intact, but looking at a youth audience or the "hipsters" referenced below, I think the iPad will have a broader appeal.

  • Report this Comment On February 03, 2010, at 3:33 PM, misternl wrote:

    The ability to highlight, place sticky notes and index the material you read is a benefit of paper textbooks. There needs to be an app that allows this on the ipad.

    Then there'll be a new market for pre highlighted and indexed text books on your ipad.

  • Report this Comment On February 03, 2010, at 4:01 PM, Alfiejr wrote:

    but there is so much more to it than just "the textbook." in no time textbooks will begin to be re-invented into interactive combinations of text and graphics plus embedded links and media, student input tests and workbooks, custom content downloads from the teacher, and so on. think of the old textbook becoming an all-inclusive comprehensive digital course app.

    the Kindle? just about as important to education as the 8 track tape cassette was to music. while the iPad at last opens the door to the future.

  • Report this Comment On February 03, 2010, at 5:47 PM, stan8331 wrote:

    Textbooks are very expensive. If e-readers like the iPad offer a significantly cheaper alternative and acceptable functionality and performance, students will adopt them in droves. If they offer an electronic version at the same or nearly the same price as the physical textbook, adoption in the educational space will be much slower.

  • Report this Comment On February 03, 2010, at 11:05 PM, jameskatt wrote:

    The Kindle is DEAD.

    The iPad not only can show Kindle Books, it can show iBooks and other ePub books, and books formatted as PDFs, Microsoft .Doc, Palm .Doc, iSilo, Text, and numerous other formats, including heavily DRM'd Textbook formats such as by Courseware.

    The iPad can show more books than the Kindle can, even if the Kindle were in Color.

    As an eBook reader, the Kindle is dead compared to the iPad.

  • Report this Comment On February 04, 2010, at 10:13 AM, akarren wrote:

    I can tell you first hand as a college student at Indiana University, The Kelley School of Business is experimenting with E-Books and the students that are using them are loving it because their wallets aren't hurt as bad. The Kindle is a perfect fit for e-books because it doesn't hurt your eyes, like the iPad would. Though for the sake of telling the truth, the Kindle has a dirty secret, which is its tough to read in the sunlight. I believe Amazon will win this battle though. They have a smart CEO in Jeff Bezos and I believe they have captured a good portion of the market to where they can survive an Apple onslaught. You got to love the Kindle with its FREE 3G service.

  • Report this Comment On February 04, 2010, at 11:32 AM, Melaschasm wrote:

    As a single purpose device, the Kindle will have to come down in price to compete with the multifunction IPad.

    I don't know what Amazon's profit margin is on the Kindle, but since it encourages the purchase of ebooks through Amazon, it would seem reasonable that the Kindle can be sold at cost or even a slight loss.

    Sell a basic Kindle for $100, a more advanced one for $200, and suddenly it becomes a much more appealing product.

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