Boundless Rewrites the Textbook

Post-lawsuit, this alternative to established players is ready once again to push ahead in its goal of dismantling the textbook industry as we know it.

• By Dian Schaffhauser
• 02/25/14

Boundless is aptly named. Where other dot-com start-ups might have crumpled up their virtual tents and disappeared in the face of a lawsuit filed by Pearson Education, Cengage Learning, and Macmillan Higher Education, Boundless co-founder and CEO Ariel Diaz continued the discussions for 18 months until he and his legal team reached an agreement with the plaintiffs that kept his firm in business.

The lawsuit accused Boundless of infringing on the publishers' copyrighted materials, as a blog analysis by educational technology consultant and former Cengage employee Michael Feldstein explained. The settlement, filed in mid-December 2013, had several outcomes, Feldstein said. First, Boundless would stop marketing its books as "Boundless versions" or "copies" of their textbooks. Second, the company would stop "aligning" its products to the ones it hopes to replace without permission and stop using the plaintiffs' book images in its own marketing materials without permission. And it would pay the plaintiffs $200,000 apiece.

The company, which launched in 2010, offers an alternative to traditional textbooks. It creates its textbooks from open content: public domain materials, such as United States government-created works or books that are out of copyright; open educational resources available from sources such as connexions that allow their materials to be used by others without fee, including commercially; and third-party independent Web sites that also use open licenses, such as Wikipedia and the Encyclopedia of Earth. The company uses subject experts to develop a broad outline for the textbook to determine the key topics to be covered and to pull the content together. Then "multiple experts" review "every single individual piece of content" before publication, said Diaz.

The textbooks — 500-plus at this point — are available free in digital form for 20 subjects, from accounting to writing. Those are covered under a Creative Commons Attribution-ShareAlike license, which lets anybody — including potential competitors — use the contents as they choose, as long as the new creation is distributed under the same kind of license.

Or Boundless hopes to persuade the college and university students who are downloading the freebie versions in large (but publicly unstated) numbers to their computers, tablets and smart phones to pay $20 for a "premium edition" that includes reminders, quizzes, flashcards, a note-taking ability and other digital features. The paid edition also includes a feature that's probably the most attractive one: Its content is aligned to the assigned textbook. For example, Pearson's World of Psychology, 7th Edition, sold for $219.60 by Pearson directly, has a $20 alternative from Boundless with content that matches up with the content in that pricier version.

Recently, Diaz spoke with Campus Technology about the settlement. During the interview he gives a brief tour of Boundless' new educator platform, introduced in December; and paints his vision for what the world of the textbook will look like five years from now.

Dian Schaffhauser: Isn't alignment part of what got you into trouble in the first place?

Ariel Diaz: I can give you the overview on the legal side. There are certain things that are a confidential part of the settlement. The quick history of the lawsuit centered around three copyright claims. From the start, we disagreed, and we fought the lawsuit from start to finish, which was a little over 18 months fighting. At the end of it, we settled with the publishers. We have a confidential settlement, and the nature of what we're doing is consistent with that settlement.

Schaffhauser: How much are students gravitating to paying you for textbooks?

Diaz: Our goal is to serve a large number of students. We actually see usage in an entire spectrum. The deepest usage we'll see is a student using Boundless as their primary content source for a course, whether it's their professor who assigns it to them or they've chosen to use it on their own. It's replacing their textbook with the $20 experience per semester. That's the deepest level of usage.

[Then we have] some people using it as a reference while they're doing their homework. They Google for a particular topic — we rank very well on Google for a lot of these academic and educational topics. They come to Boundless; they find us; they read something; they understand it; they finish their homework; and they're satisfied.

And we literally have everything in between. Somebody comes and reads an entire chapter or a little deeper. They may come and interact with some of the lightweight components in an individual setting. All along the way, our goal is to serve all of these opportunities.

Schaffhauser: How many students are downloading books and how many of those are paying you?

Diaz: We haven't broken out the channels or revenue metrics publicly. What we can say is we reach over 3 million students across all of our products. That includes premium, our apps, our Web site and third-party content delivery mechanisms like Kindle and iBooks.

Schaffhauser: How does the educator platform works?

Diaz: A little under a year and a half ago, we opened all of our content to Google to be able to access it without a registration or account. We did that late 2012. We noticed people really start to engage in that content. We started getting an organic inbound interest from educators about how they could more effectively use Boundless in their classes. We realized over time that this was a great compliment. We built this great content. We built this great platform for students to study from it. And now closing the loop by building an educator toolset was something that really started to make a lot of sense.

From that interest from educators we worked to develop our initial product, which we launched back in December.

It's truly focused on three key things:

• The ability to customize our content at a high level, which is literally dragging chapters around or deleting chapters;
• On a more granular level, which includes the ability to move around sections or regroup individual modules; and
• At a very detailed level, the ability to add or remove modules from a particular subject area or even to add inter-disciplinary content. You can create a custom book that includes content from multiple subjects, in an elegant drag-and-drop interface that educators have really been responding to.

Educators are already doing that. A typical syllabus will jump around chapters. Even within a chapter they may say, "Read chapter 5, section 1, but skip sections 2 and 3, and read section 4." Educators are already customizing it, but they're doing it in a generally analog way.

So the first step is the ability to customize a book for their course. The second step is then to be able to assign readings and quizzes to their students.

Because [we have an] all-in-one platform where the content and consumption happens, we can track all of that data, see how much time is being spent reading, which sections or subsections have been read, how they've answered the questions, and submitted them. So that is a feedback layer for the educators

Finally, for all of our content we [give] the ability to download PowerPoint slides. Because our content is openly licensed, that means our PowerPoint slides are also openly licensed. [Instructors] can download them, edit them, share them, create derivative works, and customize them. All of our downloads include the content bullets as well as images in high resolution, so they can create new templates. We include the questions if they want to use them interactively in class with something like a clicker.

We're working hard now to continue to create new tools and features for educators to make their lives more efficient. We'll be rolling those out over the course of this semester and heading into next semester.

Schaffhauser: Do you charge the faculty for their customization work?

Diaz: No. Everything is free for educators — the ability to access the book, customize it, assign it. Then it's a traditional model, like it would be in other higher ed textbooks. Once they've adopted it as a primary content source and replaced their traditional textbook, it's $20 per student.

That price point is incredibly reasonable. We have literally not had a single professor or student respond negatively at all to that price point.... That's the business model on the educator platform.

Schaffhauser: You study the textbook business. How much movement is there among faculty in moving to digital materials?

Diaz: There's quite a big variation among schools. The transition to digital has been pretty slow. I think that's primarily due to the restrictive prices. Digital products oftentimes are as expensive or more expensive than a used book. Students tend to go for the cheaper option, which is increasingly rentals of a physical product. A lot of these e-books or e-book platforms expire after three or six months. So you pay for digital goods, then you lose access to it over time. I think those have been some of the big challenges on the digital side.

If you look at the general textbook decision process, there's a ton of pressure on all schools around the economic impact on students. Study after study shows that they're spending over $1,000 a year. They're often skipping buying textbooks for financial reasons, even though they know that puts them at a disadvantage. Because of that there is a lot of interest for affordable alternatives to the traditional textbook model.

The interesting thing is that for the product we offer, there's really no barrier to adopting it from an educator standpoint. We have quality that's vetted by experts and improved upon. We've got a tremendous reading and studying experience for students. We've got a rich administrator layer for educators.

If you think about the traditional open content world, over the last 10 or 15 years, open content and the open educational movement has really been focused on creating a lot of high quality content and it has largely succeeded. What we've done is getting it to that last mile — creating a product experience that educators can easily use without having to do a ton of work, to create their content and curriculum from scratch and then to be able to easily use it in class.

We've surveyed faculty members and interviewed a bunch of them. To most educators, open content means "If I can Google and get to it, it's free and open," which is not necessarily true. It may actually be copyrighted, given that's the default state for content. There is some level of education needed for educators around what open content means. Groups like Creative Commons are doing a lot of that education around what open licensing means. Obviously, with a product like ours, it's plug-and-play. We've done all that work.

Schaffhauser: What do you think the higher ed curriculum and textbook world will look like in, say, five years?

Diaz: That's about the timeframe I would use to get us to what we call the "post-textbook world." Textbooks have been the primary content containers for hundreds of years. For a long time the state of art in terms of technology was printing. It's no longer state of the art. It continues to dominate mainly due to the industry dynamics. The textbook publishing industry is an oligarchy. The top five publishers control 80 percent of the market. There is really very little innovation because of that oligarchic nature.

As a result it has been able to keep the Internet and types of innovation at bay that we've see in other industries like music, movies, newspapers, books. But I think keeping that at bay for a long time becomes increasingly harder.

In five years textbooks go away as a dominant metaphor, and you have much more modular, much smarter content, much better learning experiences, much more mobile focus. Content will be able to give educators feedback on what content students are looking at, what works for them, how they're doing on homework, whether they're doing their reading, and having a much smoother integration between what the students are doing and what the educators want the students to do.

Using the smart phone to study will become a much more common use case for study: Review these flashcards, answer these 10 questions....

That world is really exciting. You'll be able to have education be much more flexible, much more effective, much more enjoyable, and it's enabled by this modular, open content, plus great technology.