Pearson says NFT textbooks will make them profit from second-hand sales

Pearson says NFT textbooks will make them profit from second-hand sales

Textbook publisher Pearson suggests that blockchain technology could allow it to cut sales of high school textbooks, capturing a section of the book market it has escaped so far. As quoted before BloombergAndy Bird, Pearson’s CEO, believes that non-fungible tokens, or NFTs, could help publishers make money reselling textbooks, although he stopped short of describing concrete plans.

“In the analog world, the Pearson textbook has been resold seven times, and we’re only going to participate in the first sale,” Bird said after the company announced its latest quarterly earnings this week. “The transition to digital is helping to shrink the secondary market, and technology like blockchain and NFTs allow us to participate in every sale of that particular item as it passes through its life.” Bloomberg He points out that this could mean allowing buyers to resell e-books, a rarity in the publishing world.

It is not clear how, when, or whether the NFTs will appear in the Pearson catalog. But they may represent a new stage in the long-running publishing war. Thanks to legal concepts such as the first sale principle, buyers of physical books usually own the media they purchased directly, and are allowed to sell it without the original publishers making the money. But e-books held that account. Any digital transfer creates a new “copy” of the work, and third-party sales of used e-books (along with sales of other digital media) have faced serious legal challenges as a result.

Historically this has given physical books a built-in advantage to students, who can buy or sell them used to often incur their unusual initial costs – without the publishers taking any of the money. Allowing eBooks to be resold might make this feature less exciting.

As with many mainstream cryptographic applications, NFTs do not bring obvious technical innovation to this question. Bird talks about how cryptographic ledgers keep track of item ownership from “owner A to owner B to owner C,” but this has always been possible with a digital database. The blockchain offers a decentralized version of this database, but the odds of Pearson using a fully decentralized open system are almost zero. It would almost certainly extend the existing copy protection scheme to prevent non-NFT owners from pirating their books. That would make NFT a fig leaf on top of an old DRM or DRM framework. In theory, NFTs could be sold in third-party markets that were not approved by the creator, but large companies like Ubisoft certainly did not follow this principle, and Pearson may not, either.

NFTs have had a real impact on the media world. But they mostly served as a kind of digital handbag — something fans would buy to support their favorite content creator and feel closer to them. (Fandom is a strange world, but I feel comfortable suggesting that no one really exists Likes Their textbook publisher.) Sometimes they give access to social spaces like Discord channels or voting rights on a platform like Snapshot, but this is very useful for independent publishers and authors who don’t already have a massive digital platform. Most NFTs don’t have poor control over who can see a particular work – only who “owns” a matching token, and even this is often confusing.

Nothing prevents Pearson or any other major publisher from letting people sell licenses for e-books using unencrypted DRM. In fact, third-party vendors like Tom K Cabinet and ReDigi have been trying to create second-hand digital marketplaces for years. But publishers have generally been reluctant to open the door to digital resale, especially as they experiment with ways that give book buyers even less Control, including subscription services like Pearson Plus — which Bird described glowingly during the earnings call.

So what has changed? Maybe nothing. Pearson didn’t stick to the NFT textbooks, and Bird doesn’t lose anything by spitting about the future value of a noisy (if recently flat) new technology. A portion of the resold textbook may still be less profitable for Pearson than the subscription model you currently prefer. But NFTs seem to have a psychological effect – they make people Feel As if they own something, even if the ownership is somewhat abstract. Textbook makers may see this as an opportunity to push digital markets in a new direction.

This may be a mixed bag for students. On the other hand, some resale opportunities are better than none – which is what people often get from e-books. On the other hand, the resale market controlled by the publisher will almost certainly tilt in the publisher’s favour. Library e-books have self-destruct clauses that require new copies to be purchased after a certain number of payments, for example, and an NFT e-book can have a limited number of resales. On a more abstract level, it boils down to a real legal debate about whether people should have the right to control their digital purchases. It adds another incentive for publishers to make the purchase of textbooks as troublesome and difficult as possible because, in their view, they are losing money on them.

Either way, Pearson says Pearson has “a whole team working on the implications of the metaverse and what that might mean for us” — and if they have to earn their retention somehow, I think the NFT books make more sense than fortnite skins.

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