Apple Inc. (AAPL), Amazon.com, Inc. (AMZN): Who Will Win the E-Textbook Race?

Page 1 of 2

Each day in America from August to May, children are walking the halls of schools with backpacks filled with textbooks. Despite the fact that many adults now do most of our reading on electronic devices, schools are still reliant on paper and ink, often at a cost of hundreds of dollars per student, per year.

All of this is not so good for the environment, as former governor Arnold Schwarzenegger once noted. His initiative to replace school textbooks with e-books had many rethinking the traditional concept of schoolbooks. But the concept isn’t without its flaws – not all students would have easy access to electronic devices and rented e-readers could easily become lost or stolen.

Apple Inc. (NASDAQ:AAPL)

Tech Steps Up

Still, the idea is enough to have Apple Inc. (NASDAQ:AAPL) and Amazon.com, Inc. (NASDAQ:AMZN) taking note…and falling behind a small start-up out of California. CourseSmart specializes in providing electronic textbooks to schools. It’s a business model of which Amazon.com, Inc. (NASDAQ:AMZN) has taken note, marketing its Kindle DX as a great classroom solution. Retailing for around $300, the DX may still be out of range for some students, but it’s important to note that children with devices like the ever-popular Kindle Fire can access textbooks on their existing devices.

Amazon.com, Inc. (NASDAQ:AMZN)’s e-books segment is growing at a rapid pace, with CEO Jeff Bezos announcing the company’s e-book category was up 70 percent in 2012. Amazon.com, Inc. (NASDAQ:AMZN) is a natural home for e-textbooks, serving as home to the electronic version almost every other book published in the past century or so. Still, e-textbooks is a concept that has so far been focused on college students more than those in primary school, since college students can read books via the Kindle app on laptops, iPads, Kindles and even smartphones.

Apple Inc. (NASDAQ:AAPL) Takes Its Bite

Speaking of the iPad, Apple Inc. (NASDAQ:AAPL) isn’t shying away from the action. The company’s iBooks Textbooks for the iPad focuses on interactivity, incorporating vibrant images and the ability to manipulate objects on a page. Apple Inc. (NASDAQ:AAPL) features textbooks from big-name publishers like Houghton Mifflin Harcourt, McGraw-Hill Education and Pearson.

While the iPad is outside of many primary school students’ budgets, parents are purchasing the device – especially its more affordable mini version – for young children. Apple Inc. (NASDAQ:AAPL) is making serious strides in the battle to steal some of Amazon.com, Inc. (NASDAQ:AMZN)’s Kindle customers, with Apple announcing in October 2012 that 400 million e-books had been sold through the iBookstore. Amazon is deliberately vague about its e-book sales, but in certain categories, paper books still outpace e-books. Winning the textbook market could propel one of the two companies to the top.

Barnes & Noble, Inc. (NYSE:BKS) Lagging Behind

With the closure of many of its stores, Barnes & Noble, Inc. (NYSE:BKS) needs a boost from its Nook device. Unfortunately, the company is losing money on the e-reader – a loss so dismal that its CEO is considering buying the retail chain and web side of the business, leaving Nook and its associated e-books out in the cold. It’s a move that has many predicting the death of the Nook device, which will have a hard time competing with Amazon and Apple.

Through Nook Study, the company offers students the ability to purchase e-textbooks at a discount. The big challenge is offering a wide variety of textbooks to cover the educational needs of students from primary school through college. For that, Barnes & Noble needs a big player…like Microsoft. The company’s rumored purchase of Barnes & Noble’s Nook may be just the thing education needs to start a true war for education budgets nationwide.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Reign of Terror: The 10 Most Ruthless Politicians in History

On the Move: The 10 Fastest Growing Businesses in 2015

Fast Money: The 10 Highest Paying Fast Food Restaurants

Mixing It Up: The 14 Best Music Mashups of 2014

Rito Pls Buff: The 10 Least Played Champions in LoL Season 4

10 Covers of Popular Songs that are Better than the Originals

Must See TV: The 9 Most Anticipated Shows of 2015

The 15 Biggest Box Office Bombs of All Time

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!