CPU: Textbooks seem like an ideal way to push ebooks into the mainstream. Do you see education a major catalyst for this market?
Coker: Well, I’m involved with a company called Flat World Knowledge. I’m an advisor and an investor in the company, and they’re doing open-source textbooks. They’re making high-quality textbooks available to students for free. The traditional textbook model is completely broken, and Flat World is probably one of the companies that’s going to come up with a better model and turn everything upside down. That’s starting to happen. Textbook publishing is another business where cost structures are out of control, and the business is making decisions to perpetuate practices that run counter to the interests of their customers. You’ve got publishers trying to combat the aftermarket for used textbooks by coming out with new editions of algebra or history texts every year. Come on—how often does algebra change? As a result, they’re diluting their books with all kinds of digital extras and CDs students don’t even want, and it just raises the prices. It’s created a crisis. The government is getting involved. And it’s creating an opportunity for companies to come along and better help students. Digital learning materials are the future, and there are multiple drivers for that. Cost is only one.
CPU: You mention history. In some places, history can be rewritten pretty easily. Now, you’re talking about free, open-source texts, and that makes me a little nervous. If I can change my Smashwords text half a dozen times per day, can’t I do the same with textbooks? What’s to keep us from the alleged chaos of Wikipedia, where it’s great because it’s free and still over 90% accurate?
Coker: Flat World does what is called commercial open source. They’re investing the money to produce professional, peer-reviewed textbooks from experts in their field, so the source content is solid from the beginning. Then they give the instructor the ability to modify the text to suit their needs. If the instructor wants to add five chapters or a bunch of case studies, they can do that. It’s a different use of open source than something like Wikipedia. I think there will always be value in publishers doing what publishers do best. There’s value in curation. You have a professional expert looking over the material and fact-checking it, just like your editor. That’s valuable. Curation needs to happen or else you get instances where the material is only 90% correct.