In the rapidly moving consumer-tech sector, moats are hard to come by. Constant innovation is ideal but difficult to achieve. Yet that's exactly what Apple
The fully interactive iBooks2
On Thursday at the Guggenheim Museum in New York, Apple unveiled its long-awaited move into the digital-textbook market. Officially dubbed "iBooks2," the service will allow textbook makers to create fully interactive titles for Apple's iPad. The service includes:
- A new bookstore specifically for iPad textbooks.
- A free publishing tool, dubbed "iBooks Author," to help authors create interactive instructional materials.
- A new application for its already existing "iTunes U" service for sharing university courses.
Supercharging the industry's shift to digital
Apple's two big partner publishers, and the two big players in the education-publishing game overall, are Pearson
Pearson is already quite progressive and on its game when it comes to digital publishing and in that sense is an ideal partner for Apple in this initiative. As of mid-2011, Pearson's digital education platform-and-service registrations were up 15%. McGraw-Hill is no slacker in the digital arena, either, and was reportedly working with Apple on this announcement since June.
Apple will take a 30% cut of titles sold through its new iBooks 2 application, a sizable slice. McGraw-Hill Chairman and CEO Terry McGraw told Financial Times, however, that he was "very relaxed" about the terms and believed Apple could "supercharge" the industry's shift to digital.
Getting the jump in a prime sector
Right now, Amazon.com
But for the moment, with the innovative iBooks2, the success and proven capability of the iPad itself, and two of the education sector's biggest publishers on board, it looks like Apple has gotten the jump on the competition and is poised to become a leader in yet another burgeoning sector of the digital marketplace. So long as the company can continue to innovate like this, its moat, and its future, are quite secure.
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Fool contributor John Grgurich thinks Apple needs to break out the Superman cape after this move, but he owns no shares of any of the companies mentioned in this column. The Motley Fool owns shares of Apple and Amazon.com. Motley Fool newsletter services have recommended buying shares of Amazon.com and Apple and creating a bull call spread position on Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a scintillating disclosure policy.