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

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

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!