Pretty much everyone who has ever gone to college hates educational publishers. There’s an oligopoly of just five giant publishers, and they long ago learned that they are in the best market ever: the buyers of their textbooks (the students) have no choice and are forced to buy the books if their professors assign them — and more such books will get sold every semester that the professor requires it. Therefore, textbook prices are insane by any imaginable standard. And, for decades, they kept getting higher — massively outpacing tons of other goods. For unclear reasons, the never ending march upwards in book pricing finally seemed to hit a ceiling around 2016, and prices seem to have somewhat leveled out since then. This chart from the US Bureau of Labor Statistics is really pretty striking:

And, while publishers claim that the shift to digital textbooks (partially accelerating by remote learning during the pandemic) has resulted in a decline in student spending over the last five years, the College Board’s latest estimates are still that students will spend an average of $1240 per year on textbooks and supplies. That’s… a lot.

While there are some considerate professors out there who take into account the cost of textbooks (and a very rare few who will only require open access textbooks), most don’t seem to much care. They assign the books they want, the students are required to buy them, and so the publishers just keep raising the prices. Of course, the other way that students try to save money is by buying used textbooks. The savings are not always that significant, but when you’re talking about such large numbers, it can still make a huge difference.

Pearson, the largest of the Big 5 textbook publishers, also has a longstanding reputation for being particularly evil and uncaring. A decade ago, we wrote about how it had sent a single DMCA notice that resulted in 1.5 million teacher and student blogs being deleted. The company also was a key plaintiff in suing a startup that tried to offer free alternatives to super expensive textbooks (the lawsuit was eventually settled with the startup shifting business models, before it was acquired and its cheaper textbooks were shut down).

But, the most evil thing we’ve seen Pearson do was, back in 2019, when it announced it was so annoyed by the used textbook market digging into its never ending profits, and that it was going to switch all its textbooks to non-resalable digital textbooks. For the books it did print, it was going to try to shift to a rental only system. You pay for the textbook for a semester and then you return it. To Pearson. Who can resell it.

Since then, digital scarcity in the form of NFTs has come and gone as the new hotness. And while I still think there’s something interesting about NFTs (and am still working on a big paper about the pros and cons of NFTs), Pearson, in a manner only it could find reasonable, is embracing NFTs… to fuck over students even more.

The print editions of Pearson’s titles — such as “Fundamentals of Nursing,” which sells new for £57.99 ($70.88) — can be resold several times to other students without making the London-based education group any money. As more textbooks move to digital, CEO Andy Bird wants to change that. 

“In the analogue world, a Pearson textbook was resold up to seven times, and we would only participate in the first sale,” he told reporters following the London-based company’s interim results on Monday, talking about technological opportunities for the company. 

“The move to digital helps diminish the secondary market, and technology like blockchain and NFTs allows us to participate in every sale of that particular item as it goes through its life,” by tracking the material’s unique identifier on the ledger from “owner A to owner B to owner C,” said Bird, a former Disney executive.

I mean, I kinda have to hand it to Mr. Bird, the former Disney exec. Usually, these kinds of execs at least try to hide how fucking evil and greedy they are. Andy Bird doesn’t give a shit.

So, here’s the thing. The power of NFTs to track resales and allow the content creator to participate in later sales is often touted as a benefit of NFTs. But, the reason it’s seen that way is because when done for digital artwork it benefits the artist, who sometimes has to sell their works pretty cheaply upfront.

This, is not that.

This is a company that already has jacked up prices to ridiculous levels on a captive market that is effectively forced to purchase at whatever price the publisher sets — and now wanting to “diminish the secondary market” and to track and take a cut of any future sale.

That’s not the power of blockchains and NFTs. When people talk about the useful aspects of those technologies (to the extent there are useful aspects) it’s to enable greater ownership, not less. It’s to enable greater independence from giant corporations, not more. The reason NFT resale bounties work is because everyone feels that it’s fair, and it creates a seamless way to further compensate an artist who most buyers want to support. Not to funnel more cash to a giant, greedy, evil company that is already sucking students dry.

What Pearson is looking to do is to make everyone hate Pearson that much more.

“It’s not clear how, when, or if NFTs might show up in Pearson’s catalog. But they could mark a new stage in a long-standing publishing war. Thanks to legal concepts like the first-sale doctrine, physical book buyers typically own the media they’ve purchased outright, and they’re allowed to sell it without the original publishers making money. But ebooks have complicated that calculus. Any digital transfer creates a new “copy” of the work, and third-party secondhand ebook sales (along with other secondhand digital media sales) have faced serious legal challenges as a result….

Nothing prevents Pearson or any other major publisher from letting people sell ebook licenses using non-crypto DRM. In fact, third-party sellers like Tom Kabinet and ReDigi have been trying to create digital secondhand markets for years. But publishers have been generally hesitant to open the door to digital resales, especially as they’re trialing methods that give book buyers even less control, including subscription services like Pearson Plus — which Bird described glowingly during the earnings call.

So what’s changed? Possibly nothing. Pearson hasn’t committed to NFT textbooks, and Bird doesn’t lose anything by spitballing about the future value of a buzzy (if recently flatlined) new technology. A cut of a resold textbook is probably still less lucrative for Pearson than the subscription model it currently favors. But NFTs do seem to have a psychological effect — they make people feel like they own something, even if the ownership is fairly abstract. Textbook makers might see this as an opportunity to push digital markets in a new direction.

This might be a mixed bag for students. On one hand, some resale opportunity is better than none — which is what people often get with ebooks. On the other, a publisher-controlled resale market will almost certainly be tilted to favor the publisher. Library ebooks have self-destruct conditions that require buying new copies after a certain number of checkouts, for instance, and an NFT ebook could have a similarly limited number of resales. On a more abstract level, it short-circuits a real legal debate over whether people should have the right to control their digital purchases. And it adds yet another incentive for publishers to make buying physical textbooks as unpleasant and difficult as possible because, from their perspective, they’re just losing money on them….”

“Textbook publisher Pearson plans to profit from secondhand sales by turning its titles into non-fungible tokens (NFTs), its chief executive has said.

Educational books are often sold more than once, since students sell study resources they no longer require. Publishers have not previously been able to make any money from secondhand sales, but the rise of digital textbooks has created an opportunity for companies to benefit….”

“During an earnings call this morning, Andy Bird, the CEO of learning company Pearson said it’s looking at non-fungible tokens (NFTs) as a way of earning additional revenues on the sale of second-hand books. A Pearson textbook can be re-sold up to seven times.

“Technology like blockchain and the NFTs allows us to pass through every sale of that particular item as it goes through its life,” said Bird. He mentioned the possibility of participating in downstream revenues.

That’s because many creators of art and sports NFTs take a small cut of the re-sale price, often around 5%. While NBA Top Shot sales of NFTs may have surpassed $1 billion, the vast majority of that money went to individual NFT holders in re-sales. But Dapper Labs, the NBA Top Shot rightsholder, made money on initial NFT sales and every re-sale.

However, re-selling NFTs in a purpose-built app differs from physical textbooks sold locally. The transfer cost is built into the NFT’s smart contract in the digital world, so it’s almost impossible to sidestep. In real life, one can sell a book without scanning a barcode with the embedded NFT. And students are naturally penny-pinching, so they might be keen to sidestep a 5% tax….”

“The chief executive officer of Pearson Plc, one of the world’s largest textbook publishers, said he hopes technology like non-fungible tokens and the blockchain could help the company take a cut from secondhand sales of its materials as more books go online. …

“In the analogue world, a Pearson textbook was resold up to seven times, and we would only participate in the first sale,” he told reporters following the London-based company’s interim results on Monday, talking about technological opportunities for the company. 

“The move to digital helps diminish the secondary market, and technology like blockchain and NFTs allows us to participate in every sale of that particular item as it goes through its life,” by tracking the material’s unique identifier on the ledger from “owner A to owner B to owner C,” said Bird, a former Disney executive….”