Education Shifts From Books To Digital – FAST

Posted on 2/28/2013 by Jim Pickerell | Printable Version | Comments (2)

A major shift is coming in the education market, and more rapidly than many expect. In Pearson’s recent Q4 2012 earnings call John Fallon, CEO and Chief Executive of International Education business discussed many of the “fundamental structural change” that are taking place in Pearson’s education business.

The three big themes of his presentation were --- digital, services and emerging markets
Fallon said, “Print-based materials are in decline…We need proportionately to reduce the level of resources we've got into them,” Pearson will shift from print to digital content and from classroom instruction to online learning. “Spending on textbooks is flat or declining. Mobile devices are proliferating. One-to-one learning in the MOOCs (massive open online courses) are on the rise. This shift to digital is profoundly changing the business model for content. One-off sales (of books) will diminish while subscription sales most likely bundled services… will grow,” he continued.

In 2012 Pearson had close to $6 billion in educational sales. The majority of these sales were in North America, but about 37% were generated by the International Business division.  45% of the international sales came from emerging markets with the other 55% split fairly evenly between the U.K. and the rest of the world. Digital and services revenues accounted for 56% of total sales and are expected to be about 70% by 2015.

Emerging markets currently make up about 15% of Pearson’s total sales but are expected to reach 25% by 2015. More than half the world's students and the vast majority of a new global middle class that Brooking Institute forecasts will almost double to over 3 billion people by the end of this decade live in these emerging market areas. Asia already accounts for well over half of the world student population, and enrollments are growing several times faster there than in North America and Western Europe.

Fallon emphasized “we're accelerating change in our education company. We will redeploy resources, currently focused on print publishing and in developed markets and in subscale geographic markets. We will shift investment faster towards education software and services in our major priority markets. The precise nature and timing of the changes are up for debate, but the overall direction is not.”

In The U.S.

Fallon provided some detail on the company’s U.S. policy shift from print to digital and the decision to focus on Common Core State Standards. Most states are expected to eventually adopt this standard.

The State of Kentucky is an early adopter of Common Core and they found that 1/3 of the students deemed proficient in Reading and Math under the state's old standards do not meet Common Core standards. Kentucky’s solution is to extend students learning time to evenings, weekends, and holidays and make that learning more effective. To accomplish this goal, every teacher and students needs their own laptop or mobile device.  

However, “to be effective, it requires much more than a digital textbook or some open educational resources. It requires a personalized learning environment with robust hardware and network infrastructure. It requires professional development and support for teachers to change the way they work. It requires a high degree of planning and project management,” Fallon added. He pointed out that Pearson’s ability to work across the educational supply chain is giving it a distinct advantage.

However, there is significant criticism about Common Core (see here). Thus, the rollout timing of this initiative is uncertain. That could mean that demand for any type of new educational materials in the K-12 markets will remain subdued.

What’s This Mean For Photographers

1 –Textbooks will be replaced with a whole new range of digital products and services.
2 – Fallon says, “We need less content. But the content we create needs to be more high powered, and it needs to be at the center of the connected system of learning services.”
This could mean that more will have to be created in-house or on assignment rather than buying stock.
3 – Subscriptions, rather than one-off sales, will become the dominant licensing model of educational materials making actual usage more difficult for image sellers to determine.
4 – As more and more educational products are delivered digitally it seems likely that there will be increased demand for appropriate video. However, clips aimed for the advertising market will probably not be very useful in the new education products.
5 – These changes may be well established in two or three years.
6 – Circulation will no longer be an effective tool for establishing price.

Fallon added, “We are reshaping the organization to take advantage of what we believe is a once-in-a-generation opportunity, and one that will lead Pearson into its next phase of vigorous and sustainable growth.  …this next phase is really all about accelerating the digital transformation, accelerating our move into services and building our presence in emerging markets. And we're going to do that by shifting some resources more quickly from our textbook publishing businesses to fund the faster-growing opportunities. Our future customers will be consumers or learners directly just as much as they will be the institutions of the educators that serve them.”

Copyright © 2013 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


  • David Hiser Posted Mar 2, 2013
    What’s This Mean For Photographers, continued.

    Also, how can we know if they use our pictures licensed for their print textbooks in their digital products? It the past we could check subsequent editions and bill them for the additional use....

  • Ottmar Bierwagen Posted May 3, 2013
    It probably means bundling costs to cover all uses, including print and electronic; the publishers are now also expecting a 10 year term.
    Our model of stock agency is dying on the vine. Time to close shop and maybe take up knitting....

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