Savvy college students sabotaging textbook profit model

Prices for new college textbooks have risen steadily since the 1970s, but students have started to spend less on them. College students spent an average of $563 on books in the 2014-15 school year, 20 percent less than in 2007-08, a study released last month by the National Association of College Stores shows.

"Our research indicates that students—46 percent—still prefer print over other formats," says NACS spokesperson Laura Massie. Nonetheless, she adds, they're finding ways to get course materials cheaper. "Many are acquiring used copies, or rentals rather than purchasing new, and others are moving to digital versions."

Textbook prices have gone up about 6 percent every year since 2001, according to the Bureau of Labor Statistics. Publishers have been able to raise prices this much, in part, because their classroom-bound customers have had little choice but to pay whatever they charge. Yet as costs have ballooned, more services have launched to help students save, which could threaten that pricing scheme.

"The economics of college textbooks is very different from anything else," says Mark Perry, an economics professor at the University of Michigan. "Professors select the books and students have to pay for them, so the normal market mechanisms aren't at play here. Publishing companies charge whatever they can get away with, which is unsustainable."

In recent years, businesses have cropped up that help thrifty students trade and rent texts. Textbook rental services such as Chegg and College Book Renter are popular among students who only need a title for one semester, says Perry. Renting textbooks can save students as much as 70 percent, reports Follett Higher Education Group, which manages more than 1,200 campus bookstores. Other services, like OpenStax College, Boundless, and Flat World Knowledge, offer free online textbooks or a printed version for less than $50. Amazon's textbook store lets students rent, trade, sell, or access digital textbooks at a hefty discount to buying new books.

As resources for saving on books have grown in number, students have gotten smarter about how they shop. The NACS found that 82 percent of students research their course materials through multiple outlets before purchasing them.

It has gotten more difficult to buy required materials secondhand, says Perry, because textbook makers have sped up their publishing cycles. "Books that I use in my economics classes come out every two years now, when they used to come out every three to five years," says Perry, even though he says what's taught in introductory-level classes doesn't change enough to warrant the faster updates.

Some colleges are making low-cost options available to students. In the spring of 2011, the University of Massachusetts Amherst began the Open Education Initiative, which gave faculty a monetary incentive to seek alternatives to high-cost textbooks and use open educational materials that are free on the Web or available at the library. The grants ranged from $1,000 to $2,500. In the four years since it launched, it has saved students over $1 million, says the initiative. Similar programs at University of California, Los Angeles and North Carolina State University have helped students save on books.

Despite a textbook publishing industry that produces pricier books more frequently, students and colleges have found ways to offset the cost of studying. "The average spending on overall course materials is down and we're very pleased about that," says Massie. The Association of American Publishers reports that almost all college textbooks have digital versions that cost as much as 60 percent less than print textbooks.

Students who go digital may in fact get more for less. "These interactive online course materials use personalized learning technologies to assess where students are strong in a subject and where they may need improvement, helping students succeed in class," says Massie. "The next generation of materials benefits students beyond just their pocketbooks."