4 Ways To Grow A Publishing Company
eBooks, iPads, and the Kindle are changing the fundamental structure of the publishing industry. From a strategic perspective they are having the largest impact on the development and pricing of products. In other words it is affecting the "what" deeply. The "how" has not changed all that much, regardless of whether you are selling print and/or technology.
There are four fundamental strategies for a growing a company in the K12 sector because even in the best of times K12 is (mostly) a zero sum game. In 2008 I wrote a post about this competitive dynamic:
In normal times education budgets grow at 2%-5% a year. Most start-ups or new products need to grow at a huge multiple of that - 30% to 300% or even more. Mathematically in order for you to grow someone else is must lose out.We are most definitely not living in "normal times" these days. Any growth strategy in today's market is fighting gravity as school budgets are expected to fall next year after the stimulus has expired.
K12 Growth Strategies
How does a company go about "stealing" share from other players in the market? Below we look at innovation, distribution, acquisition, and diversification.
1. Innovation - This is the most obvious - if you build a better product people will flock to you while ignoring the tired offerings of your competitors.
The best example in the market today is interactive white boards which are now in over 60% of classrooms (70% is considered market saturation for most technologies). This has mostly happened over the last 5 years.
Since this platform is now ubiquitous a new innovation frontier is content for these devices like Saddleback's excellent math programs.
PCI published our award winning PCI Reading Program - the first research based comprehensive program for intellectually disabled students in decades. It is designed for today's Special Ed population, including a much higher number of students with autism. Tellingly it is a combination of print and software. This product line has seen explosive growth in a rough market.
Success requires a clear vision of market needs and how to apply new tools to those needs in an economically efficient way. Easy to say, really hard to do.
2. Distribution - Distribution is the achilles heel of all K12 start ups. If you have something innovative making more people aware of your innovative solution will drive new business. The problem is that there are 3.8 million teachers in the US and they are bombarded with marketing messages. Cutting through that clutter at that scale takes time and money.
The largest publishers have actually contracted their distribution networks in the last five years. They collapsed their supplemental teams into their core basal teams with the predictable result that the supplemental business has shrunk. There is a fair debate on how much of this shrinkage is falling demand on the customers' side and how much is publisher neglect. What is clear is that the publishers' actions have fueled the fire at some level.
This has created opportunities for mid-market players with niche distribution networks to fill the gaps at both ends - with their own products and as distributors for larger and smaller players. As I noted last fall:
"...[in the attention economy] access to expertise becomes very valuable and companies that can help their customers make informed, relevant, and effective decisions will thrive."An investor once asked me what it took to build a distribution network in K12. My answer was most definitely not what he wanted to hear - 10 years and a lot of patience. Most new companies don't think in that kind of time frame but the survivors will all tell you that the trick was a long term bloody minded dedication to the challenge. There is no quick fix here.
3. Acquisition - Between starts ups innovating new learning technologies and mature mid-market companies seeking exits Education is a target rich environment for those seeking acquisitions.
The core challenge has more to do with investor expectations for returns on capital and the speed at which the education market moves. Due to the stickiness of education solutions once they are adopted they pay out nicely over a long period of time. Put another way - the payoff is there in this market but most investors are not patient enough to earn it.
Right now the larger publishers seem to be sitting this out but people looking to enter the market - like News Corp - are active. Private Equity groups are circling as well but many probably see education as a low risk hedge rather than a core investment. The VCs are quite active - but they are investing in small innovative start ups.
One of the more interesting plays may be marrying the playbook of the PE and VC camps. Leverage the distribution muscle of an established player than can reach across the market with the disruptive innovations coming from the smaller players through creative acquisitions. Culturally and operationally there are significant challenges in this approach, but the payoff if done correctly is a dramatic reduction in the time to market for innovations at a time of disruptive change.
4. Diversification - Another approach is branching into new markets. There are opportunities in corporate learning, education systems in other countries, tutoring, trade publishing, home schoolers, etc. for publishers who currently sell just to schools.
This mistake that may company's make is underestimating both the changes in product design and the distribution challenges associated with moving into other markets.
Does your box say "program" instead of "programme"? At a minimum you will need a new box if not a complete page review and spelling update for the guts of your program if you want to sell it in the UK or Australia. Are you ready for the rough and tumble of trade publishing or corporate learning?
Moving into new markets requires sustained discipline as you learn the rules of the road and a willingness to invest over a long haul. If you are looking for a quick hit don't waste your time on this approach.
Summary
If you are thinking about how to grow your business (rather than just holding on in tough times) then some combination of the four approaches outlined above is where you will probably end up. Your vision, access to capital, and discipline will determine what the right mix is for your company.
I've probably missed some obvious alternative to the four core growth strategies outlined above. Feel free to drop me an email or comment and we'll update the list.
In
There are bad ideas that become iconic for every era because they were popular fads. Pet Rocks, the Pacer, Supply Side Economics, and .com groceries all come to mind. 
Is the Internet making us dumber or are we just using our brains in new ways? The BBC posted
What could be nerdier than a huge


At
When educators choose new classroom materials their first challenge is to sift through dozens of options and narrow the search down to four to five options. In other words before they say "yes" to one solution they need to find reasons to say "no" to a host of other options.
My 17 year old son is in the other room using a kayak paddle with chain saws attached at either end to slice zombies in half. I'm sitting here minding my own business when out of the blue he says "Dad, this game is great for teaching time management skills."
The role of textbooks in a rapidly digitizing world is an open question. The publishing industry needs to develop a new paradigm for commercially produced instructional materials or
The International Reading Association's
I'll be reviewing the findings of the white paper I wrote for SIIA on
What is good product development? The answer is deceptively simple to answer and devilishly difficult to pull off. Basically people want three things - better, faster, cheaper. All the complicated analysis in the world boils down to these three fundamentals. Get them right and your odds of success go way up.
What are the missing skills needed in education publishing to create 21st Century products for 21st Century learners? I penned a thought experiment for
A fresh batch of piping hot links that may be of interest to those in educational materials.
Ed Note: One of my favorite thinkers and practitioners on engaging kids deeply with Math and Science is
Districts increasingly need a single point of access and management for digital curriculum assignments, assessments, student work, lesson plans etc... Right now, just about every digital educational resource offers an "LMS." They range from light versions with assignments and reports to a full blown solutions including portfolios and groupings and more.
Louise Dube is currently consulting in product management in the educational technology industry. Louise has over 15 years of experience marketing and developing educational technology for K-12 schools, students and parents. She has worked extensively on creating market driven innovative technology solutions to close the achievement gap. Most recently, Louise was President at
Today's walkabout focuses on a fundamental shift in the instructional materials industry away from the scale economics of the big textbook publishers to the value of niche focused expertise. I believe this is the future of our business.
50% of the men did not wear neck ties at this year's
Another aspect of the Book Fair that I love is getting exposed to trends from elsewhere. One topic close to my heart is gaming and Holland had a big presence in the
When textbooks go fully digital what will schools buy? Will they buy individual lessons, units of 2-3 weeks length, or full curriculum that span a year the way they do today? This is the $5 billion question facing our industry.
Mama Bear - Too Big - Knowledge acquisition for on-level students is an entirely different kettle of tea. If we want to model 21st Century Skills for learners it is incumbent on teachers to use a wide variety of source materials so that students can experience how knowledge is developed in the real world. Social Studies, Science, Literature, Career Readiness etc. all demand a catholic approach to content. The unit of appreciation is a lot smaller than a textbook - in many cases it is a single page document.
In discussing the potential for ads in e-books - the latest hail mary pass of traditional media - 
"Gee - nice copyright you have there. Be a shame if anything happened to it."
Last week the
Third Error - Recreating the book experience on-line is not sound instruction
In Which We Do "The Math"
Guest blogger
On-line bullying has been a concern as long as the web has been around. Yet only now, with the proliferation of social networks, is it really getting its due. Today's New York Times has an 
It's been four weeks and my iPad still has that new computer smell. Now that I've been using it in my workflow I wanted to post some additional comments on it's utility in an educational setting.
Games are a hoot. Playing
I've been using
Sure you can do most of this on your phone today - but after three years the scrunched over squinty stare at my phone is wearing thin. The iPad provides much more natural and human scale interaction.
The iPad is an imperfect content creation device, at least without a couple of additional tools. For short bursts of writing, photo editing, and simple drawing is performs admirably. More complex tasks can become a chore.
Kid's virtual world
An
For now this is an R&D platform not a distribution channel. I couldn't even bring myself to charge mine on the company card - I took it as a personal expense. But I want to use it, live it, and see how it can change my own workflow. With that experience in hand I hope to have a sounder vision of how the technology can be used in the classroom. It will definitely take off in the trade and home education markets first - schools will follow not lead.
Seth Godin makes
Coming to Orlando from Wisconsin in January, I expect warmer weather. I didn’t expect 50 degrees to be greeted as a warming trend. And when I saw the conference center adjacent to my hotel was hosting a
Mike Baum
The tribe gathered, bad coffee was drunk, stale muffins were eaten, and we shared insights and guesses about where education technology and publishing are headed in era of tight budgets and ARRA munificence. It was a typical first week of December in New York.
Fundamentally education can be an extremely profitable market with intense long term loyalty. The problem for most investors is that it is all about a mountain of slow nickels rather than a small pile of quick dollars.
The education publishing tribe's annual gathering is in New York this week. Today kicks off with the 
We are seeing the same pattern in literacy that we have seen in other media as they digitize. Increased exposure and access leads to an increase in demand. Movie studios fought HBO tooth and nail - until they realized that more people were going to the theater. The web - with its heavy emphasis on text - is leading a revival of literacy skills.
One of the most obvious ways to engage students is to give them access INSIDE of school to all of the amazing Web 2.0 tools that engage them OUTSIDE of school. Who hasn’t tried to get through to his 15 year old with an iPod cranked in his ears and a cell phone glued to his hands?
Clive Thompson over at 

At its root the competitive arena is a complete rehash of the Mac vs. Windows battles of the early 90's.
How can technology and innovation reshape education?
3. The user developed content model assumes a motivated learner. On-line classes work best for the same students traditional correspondence courses worked for - i.e. not your potential drop outs but those with an extra dose of motivation. See item 1 - I've seen dozens of businesses that were able to get a few hundred users doing creative and interesting learning on-line that were never able to scale up.
Try this thought experiment from a business perspective. Assume you have a front line supervisor who has 25 direct reports. Best practice would argue for between 5-8 reports. How much time will that Supervisor have to think strategically about the business? Now imagine that they are required to submit daily and weekly progress reports on all 25 employees - no slacking off on a few of them for a week or two. This is your average teacher. They don't have time to assemble mix tapes of content for all their students.
We are collectively discovering the value of social media tools like 

This article is based on notes from a panel at the
Q We are at an inflection point. What is your long term view of long term trends.
Q - What tactics can companies employ during a time of economic difficulty to remain healthy and vibrant.
A new free 




Today guest blogger
What are the prospects for raising capital for education technology companies in the current financial meltdown? Last week at the
This panel is made up of seasoned veterans of the M&A markets for Education Technology companies. They addressed the K12, Higher Education / Post-secondary, and general M&A climate.
I will be blogging today from the Software Information Industry Association's Ed Tech Forum 2008. The event is taking place at a monument to mid-20th Century American hegemony - the Princeton Club in New York.
Products designed for the classroom must meet the needs of teachers first. If students are the primary users of your instructional materials this may sound a little backwards - but it isn't. Teachers can make or break your product before a student ever sees it.
The Solution
Innovation is needed across the entire business model - sales, marketing, editorial, operations, and support are all being affected by the explosion of information in the hands of our customers. This kind of systemic change is really difficult and will take several years to sort itself out.
Piping hot education related blog topics served here! The debate over formative assessment, the top 10 sites for educational games, crowd-sourcing the next great novel, controversy around Microsoft's new ads, the relationship between quality and advertising, and a hilarious spoof of Politicians all get the nod this week.


As print and technology products in education blend together the distinctions between textbook publishers and ed-tech providers are blurring in some very interesting ways.
Hot sizzling education publishing and ed-tech related links here! Obama's call for more teachers, kids media preferences, 2.0 de jour, and assessing 21st Century skills all get a nod in a short week.
Fresh hot blog links to education topics here. These are some of the posts that caught my attention recently - enjoy.
Videogames in the Library? Wouldn't installing a Wii or an xBox bring a lot of unruly teenagers into a refuge of quiet and intellect? It turns out that putting computer games in a library brings in a huge wave of new patrons and dramatically increases circulation - of books!
Information is expanding
Why can't teachers buy lessons like people buy songs off of iTunes? Are publishers at risk of irrelevance if they don't proactively solve this problem for their customers?
Education technology bloggers have been a busy lot with NECC 08, end of school year, and lots of new products to play with. Here are just a smattering of some of my favorite posts from the past few weeks. Enjoy.
ISTE's National Education Computing Conference (NECC) 2008 is in full swing in San Antonio. 
How will the economic downturn affect education budgets? How are executives at publishing houses and education technology firms planning for the recession?





What do large school districts need from ed-tech providers?
7. Stick by them - they are in it for the long haul and they need business partners to trudge that road with them. This is a legitimate request but a hard one to implement due to the management turmoil many large districts suffer from on an ongoing basis. It can take years to position a sale in a large district only to see it derailed by a reorganization or funding re-allocation. Only the largest publishers can make this kind of sustained commitment which limits the range of innovative solutions that the large districts see.
Large Districts (and States) need to resist the temptation to use their market power in ways that ultimately hurt their own interests. There are perfectly legitimate uses for that market power so I'm not advocating unilateral disarmament - just suggesting that some restraint is needed on both sides. Districts shouldn't make unreasonable demands and vendors shouldn't make unrealistic commitments.
With five school age kids of my own, an academically curious wife and wireless-device-addicted me, I think our humble family averages about 50 searches a day. And, as my sons are crazy about electronic games and occasionally pine for another dog – I can certainly understand the top results of the netTrekker d.i. ranking. Although it would have been heartening to see more academic search terms in the top 5, it is comforting to know that kids will be kids, whether at school or at home.
The reaction of many parents and educators to the idea of
But the concept of fluency goes far beyond reading. Learning to play an instrument, writing, using a knife, flirting, skateboarding and thousands of other human activities all share the need to grind it out over time to develop that effortless fluency that is the mark of an expert.
It has been a while since I did a round up of blog articles, time to clean a few items out. Rather than dump a long list I've picked four articles I've found particularly interesting in the past few weeks.
New York, Texas, California, and Florida have opted out of No Child Left Behind (NCLB) and will be abandoning all high stakes testing. It is unclear at this time if other states will follow, although indications from across the political spectrum are clear there is strong interest.
In response to these developments a spokesman for Houghton/Harcourt sniffed that this was a clear sign that it is time for Pearson to drop out of the race for dominance so that the nation can come together for the fall back to school season. He then added that if Pearson was as experienced as they keep claiming to be why did they buy the now moribund testing side of Harcourt? He added "Books, books, books - thats where we see all the action and growth over the next 15-20 years. Glad we dodged that assessment bullet in the Harcourt acquisition."
Curious about how Web 2.0 is going to affect education?
What is the future of publishing? I moderated a distinguished panel at the

This is the kind of project that engages students in the larger world using Web 2.0. The fact that people who knew and loved the soldiers are paying attention makes it meaningful in ways that most schoolwork never addresses. Using a mix of music, photographs, and text the students are painting a bigger picture of each of those honored than found on traditional memorials.
In Japan novels are serialized for cell phone delivery and published as dead tree editions only after they are hits. John Rice has a great post on on this at his
Second, the Japanese are not fighting the new tools but finding ways to use them effectively. Cell phones 
Dr. Gee as an educator was curious about why videogames were able to do so much that our education system was having trouble doing – continuously engaging students, making students feel safe failing (not silly), unafraid to ask questions, and providing contextual learning that makes the learning relevant to the learner.
4. Practice Principle – [In a videogame] - learners get lots and lots of practice in a context where practice is not boring (i.e. in a virtual world that is compelling to learners on their own terms and where the learners experience ongoing success). They spend lots of time on task.
And students are singing the praises of educational games and simulations, with approximately 88% of the students who have used our software recommending it to other students and over 90% saying they wished more simulations were in their classrooms.

What tools do teachers find useful for learning and teaching? 





Today we take a look at ten ideas for how we can build products that tap into the new
2. Network your learners - Often we treat collaboration as cheating - but in a world of
5. Build
8. Plant
Welcome Technology & Learning readers. My article 
My company is witnessing this progress as well. Specifically, from school year 2006 to school year 2007, subscriptions to our K-12 product netTrekker d.i., [http://school.nettrekker.com/frontdoor/] -- delivering safe, relevant digital content to every desktop-- saw an 84% increase. We recently hit the 10 millionth student mark and netTrekker d.i. is now used in 19,000 schools – an increase of 2,000 from last year -- in all 50 states including adoptions by key districts and states nationwide.
Teaching metaphors, the role of school in society, bad (i.e. wrong) press for video games, glitz vs. content, banned books, racism in games, phishing games, and monkeys at the keyboard. All featured on this weeks roundup!
[Ed] This entry concludes are guest blogging by Paul Schumann on technology substitution in the K12 market.






[ed] The business of textbooks and educational technology are in a period of disruption and change. Today we present part one of a three part series that takes a quantitative view of this change. This study uses modeling techniques that have proven themselves in numerous other industries. The implications for education are fascinating and challenging.
For 36 years Substitution analysis has been a well accepted method of technological forecasting. In these analyses, the 


The changes are affecting every aspect of our business including how products are created, priced, sold, packaged, promoted, and even what the basic definition of a product is. I believe these changes are only beginning and that they will accelerate in the next several years. Anecdotal evidence includes attendance at shows like the recent
There is a more quantitative way to study this change. Over the next few days we will be publishing a study done by 

It got a nice review on John Rice's
First off, I find it interesting that Second Life is getting most of the visibility in Education when other virtual worlds (Habbo Hotel, Whyville, etc.) are doing far more with K12 age kids and some have more intentionally educational content on them. Chalk it up to Second Life being a media darling and to good outreach from their Education team. If you are interested in this arena some of these other worlds merit a look.
Breaking down artificial boundaries in the world of Education emerged as a theme today at
This thread was picked up early in the afternoon by panelist Jackson Grayson from the 

Sulka Haro, one of the founders of
The panel on Managing Influencers at the Austin Game Developers Conference yesterday got me thinking about a frequently ignored aspect of the K12 publishing world - building and nurturing communities of key influencers around education products.
Blizzard matters to education because when you strip away the Orcs and Elves under the hood they have built an extremely elegant learning management system. As the undisputed world wide leader in the
3. Resist the pressure to ship early
2. They fund it like a war - it becomes the “mother of” all software projects. This drags development out, ratchets up costs, and ultimately means you are very distant from your customer’s needs. Eventually someone sane comes along and kills the whole thing leaving a bad taste in everyones mouth about technology.
Virtual Worlds and Video Games for Education are getting a lot of press these days. With all the hoopla it helps to bring a little perspective to where we are in the development of this new market. It is feeling a lot like the web in 1997 and perhaps we can take some lessons from that era to help us make sense of today’s emerging opportunities.
7. Selling Picks and Shovels - The big winners last time were those who sold the tools. For educational virtual worlds the toolsets are changing quickly and reducing the cost of entry. There are several that can be used for educational tools and Richard Carey has done a nice job of
Will Richardson over at
With a 16 year old son headed off to university in a couple of years I’m sensitive to the rapidly rising costs of higher education and the portion that textbooks represent. But I also think it is disingenuous to point at books as a major cause of this inflation. Students spend about 5% of their budgets on books, and the total is declining 1.8% this year. Compare this with the market for electronics where students spend twice as much and it is increasing at 25% per year. Was this topic worthy of a NYT Op-Ed?
The average cost per title will be far below the numbers Granof cites. Lets use Granof’s own numbers to make this point. Averaging the prices he cites a book would cost $150. At the stated budget of $900/semester that means students are only buying 6 books a semester. That is a pretty light load. Students have to be buying lots of used-books to live within that budget.
But I also think there is a fair amount of common sense to the concept that re-creating the book experience on-line is a dumb idea and most students agree. This is a sign that their education is working for them. Books do what they do best and they have been refined for their purpose over several hundred years. Technology should be harnessed for what it does best (simulations, large scale number crunching, productivity tools, communication) not doing the functional equivalent of putting plays on early television.

What will be more interesting is when these types of systems can be used to evaluate educational practices by looking across multiple districts at large data-sets. Most districts in the US simply are not large enough generate solid statistical data and most of the current efficacy research in this arena focuses on a few classrooms at a time. We move forward doing the best we can backed by anecdote and social science. There have been some
The conference has about 350 attendees and is an interesting mix of academics, teachers, and some business types. The agenda is so rich that it choosing sessions is agonizing.
"The dirty capitalists trust our children more than the schools to learn complex language."

The real trick would be to combine accountability with recognition. For example - a school couldn’t be labeled Needs Improvement unless the state also found some things that they were doing right and recognized those things. And yes - there are plenty of recognition awards for teachers. But, in a state like Texas maybe 500 out of 290,000 get recognized each year. If your school fails - everyone looses their jobs. It seems disproportionate.
The National Education Computing Conference 
The first
It really is this simple - but simplicity is difficult for most companies. You must put the time in up front to get the promise nailed down and then you have to sustain your focus on it long enough for the market to believe you.
In one room a panel of distinguished educators was discussing the challenges of bringing in new technologies. Their discussion centered on what the lawyers would let them do and the endless committee structures they had set up to screen what was permissible with blogs and other social media. Short answer - not much.
Next door the Weekly Reader was presenting their
Where are breakthrough products like the
Lee Wilson is President & CEO of 