Scribd and the new era of the $10 textbook

The traditional textbook publishing model, based on dead trees and middlemen, can force students to shell out hundreds of dollars for a stack of photocopies. Now, two law professors are showing how easy it can be for academics to offer an alternative at a fraction of the price.
Eric Goldman and Rebecca Tushnet are both trademark experts and popular bloggers. This week, they offered a new package of course work called “Advertising and Marketing Law: Cases and Material” for sale on Scribd for just $10. In a blog post, Goldman explains the economics behind the $10 price tag:

Compared to 99 cent or free eBooks, a $10 downloadable book may sound expensive. But, compared to the typical law school dead-trees casebook, $10 is a ridiculous bargain. Many print casebooks of comparable size cost $150 or more. … While we could easily justify a higher price than $10, we’re not exactly philanthropists. Here’s how I see the math: a $150 casebook may have a $110 price wholesale (or less). At 10% royalties to the authors, Rebecca and I would share $11. At the $10 download price, Scribd takes $2.25 a download, leaving us author royalties of $7.75. So discounting the retail price 93% perhaps reduces our royalties by less than 30%. Let’s hear it for disintermediation! Plus, just like any demand curve, the lower price point should lead to higher sales, which may, in fact, make our approach profit-maximizing.

The book will be available to read and mark-up on any electronic platform and can be printed as well. The authors are not applying any digital rights management to the book, but are relying instead on the low price and a moral appeal to limit unauthorized sharing.
The book is available on Scribd, a popular document-sharing platform, that has already attracted the interest of the publishing community. In 2009, Simon & Schuster signed a deal to use Scribd as a potential Kindle competitor, offering excerpts and complete works from Stephen King and others.
Interestingly, in his blog post, Goldman blasts Scribd as a “horribly limited platform” and complains that it requires users to provide their Facebook profile to complete the purchase. He adds that he and Tushnet intend to switch to an alternative eBook platform as soon as they can find a better one.
Goldman and Tushnet are part of a larger phenomenon of disruption in the textbook publishing business that is leveraging digital distribution possibilities and eliminating intermediaries. Other examples include sites like BenchPrep and Boundless Learning that offer personalized or open source content via mobile and the web.