NyTimes, Apple Unveils App and Tools for Digital Textbooks
On Thursday January 19, 2012 Apple released their newest strategy to conquer the world one less text book at a time. In their recent education announcement in New York, Apple declared their intentions to make textbooks available on iPads for a fraction of the cost.
This includes not just a fancy PDF of the textbook pages, but a full suit that permits textbook writing, developing, and enhancing. Teachers and writers can create interactive graphs, and searchable text for the textbooks developed through Apple. Likewise, Apple is launching a survey building software that could link into these textbooks, making it easier for teachers to create assignments, and for student to understand them. To student and teachers, this is all pretty cool stuff. In a business strategy sense, though, I think it's even cooler. Here's why:
Problem: By most estimates, Apple has not captured as much of the electronic book market with the iPad and its iBookstore as its chief rival in the business, Amazon, has with the Kindle e-reader.
Strategy: while Amazon was a much earlier entrant into the e-books business, it has been less successful in the education market. Education is where Apple has an advantage against Amazon. Apple has a deep and longstanding connection with the education market that could serve it well as it enters the textbook business. Even as its Macintosh computers were shunned by big purchasers of technology inside corporations in decades past, Apple found success selling them to K-12 schools and colleges.
Before he passed away, Steve Jobs told Walter Isaacson that he wanted to hire well-known textbook writers to create electronic versions of their books. He said that Apple could sidestep the state certification process for K-12 textbooks by making them available free for iPads.
Conclusion: Considering the "Pepsi/Coke" wars, I think it is interesting that when considering the Porter's 5 forces model, the largest factor making the softdrink industry unattractive to new entrants is the rivalry among competition - specifically among Pepsi and Coca-Cola. Pepsi and Coke entered a marketing war that has turned them literally into american icons. Virgin Cola's failure to enter the U.S. market illustrates this perfectly. Among the largest failure of Virgin Cola was the inability to topple what people have come to long consider an american icon. Virgin's marketing campaign was not clear, and buyer loyalty was already too great. I find the E-reader Vs. iPad battle to be panning out in a parallel fashion to the Pepsi/Coke war. Amazon has used its sheer brute internet immensity and customer base to sieze the digital book market, but Apple hasn't bowed out.
Apple has an interesting strategy: Continually target the education sector with innovative, remarkable, and sometimes just really cool products. Although Apple does not control the market, they have consistently made themselves iconic among younger users. Apple is working against its competitors by using its key strengths: the ability to become an icon on campus.
“Education is deep in our DNA and it has been from the very beginning,”
Philip W. Schiller, Apple’s senior vice president of marketing
source: Apple Unveils App and Tools for Digital Textbooks. NYTimes. By Brian X Chen and Nick Wingfield | January 19, 2012
