John Wiley & Sons came up bupkis in the Supreme Court of the Unites States in their Copyright infringement case against a Cornell student who was reselling Wiley textbooks published in Thailand in the USA at a highly discounted rate.  One would think that ruling is terrible for textbooks and for authors — the opposite is true.

Here’s how the NYTimes reported the story:

In a 6-to-3 decision, the court took sides with Supap Kirtsaeng, a Thai math student at Cornell who generated roughly $900,000 in revenue reselling in the United States cheap textbooks that his friends and relatives sent from Thailand.

John Wiley & Sons had argued that Mr. Kirtsaeng was infringing on its copyright by importing the books without permission. The publisher said this short-circuited its ability to segment markets by price — selling the books more expensively to American students than to poorer Thai students who could otherwise not afford them.

But the court held that the publisher’s right to ban imports was trumped by Mr. Kirtsaeng’s right of first sale. He might not be allowed to make unauthorized copies of the books. But as with old library books or secondhand Gucci bags at a flea market, if the books had been bought legally, whether imported or sold originally in the United States, Mr. Kirtsaeng could sell them.

This is a victory for consumers and authors because it will cause major publishers to end their predatory pricing policies by country and region, lowering prices across the board.  Why should students in the USA pay $200.00USD for the same textbook that students in Thailand pay $20.00USD to purchase?  Having a single, affordable, worldwide price will lead to more sales and remove the incentive for reselling books on the used and grey markets.

Today, authors tend to get a flat royalty rate that is heavily discounted across the regions of the world, and so they rarely make any large money past the initial royalty advance investment — if they even get upfront money.  Author advances are quickly becoming a totem of antiquity, and so authors are basically work-for-hire writers, and the majority of book sale profits are kept by the publisher/distributor who owns the dirt roads and the virtual pathways.

Textbook prices are out of control.  The ASL book we use in class costs $175.00USD and many math and finance textbooks are in the $250.00USD range.  The prices are so obscene because the publisher only makes money on the first sale.  There’s no aftermarket incentive in the used or grey markets for publishers to extort, so they get you on the first sale and leave the residual crumbs to others.  Those others, now that we have a global economy, and an open, international, educational ecosystem, are taking advantage of lower regional prices to out-muscle the used book market by offering new first sales in regions other than their own — and they are winning.

Some instructors — never me — make photocopies of textbook for students, clearly violating international copyright laws, in order to help students save money.  I am of the mind that if a student cannot afford the textbook, then they cannot afford to take the class; but with book prices rising along with tuition at alarming rates, I am beginning to see the despair on the student side.  This Supreme Court ruling against Wiley should remedy some of these high price problems because publishers will be much more wary of secondary markets and used books and aftermarket resales because they can no longer rely on the law to enforce their guaranteed first sale monopoly.

26 Comments

  1. Once again I am horrified by the prices mentioned. How many of these books are students expected to buy a year …………….. ?

    I know my daughters University had a thriving 2nd hand book shop where enterprising students sold on their books at the end of the year for the next years students. She ended up buying some new and some secondhand each year and selling them on at the end of the year. There were waiting lists for some of the books.

    1. I know students who routinely spend $2,000.00USD a semester on books alone. It’s a massively big business.

      Now that this ruling has come down against Wiley, I fully expect publishers to start strong-arming their way into the secondary used market — or nullify it entirely by simply lowering their first sale prices.

      Or… they’ll go 100% electronic book sales and force you to pay whatever amount they wish with no resale rights available at all.

      1. OUCH

        They will be setting up their own version of amazon with pre- owned copies for sale as well.

        I hope they chose to lower first time prices but I doubt it.

        That would be my least preferred option – 100 electronic – I still like a book to be a book …………….

          1. so if you buy the electronic book – do you have the right to print it off to use and read where you have no access to a computer ?

          2. It all depends on the electronic license that comes with the book. I would think publishers would not want any way to print or copy a book. They want you to have to use a device like a Nook or a Kindle to read in virtual mode only.

          3. that is what I thought and one of the reasons I am so wary about this – I know several people who have had their total book collections deleted by Amazon/Kindle due to no fault of their own, and they have all failed to get them back.

            None of this sharing a book in class any more either !

          4. I imagine that the publishers will find themselves facing two problems : students pirating their books rather than buying them, and teachers turning to open source textbooks rather than paying their extortion-like fees.

          5. That’s good insight, Gordon. I don’t think there’s a DRM alive that hasn’t yet been cracked. It will be a testy game of locks and revisions and versioning!

            Open source textbooks will be fascinating. I can imagine some instructors exclusively using something like Wikipedia to teach a history class.

  2. I remember when I was at Rutgers, I was quite upset by the high price of books — and it just seems to go up and up with no end in sight! Makes you wonder why professors don’t let students use the previous year’s editions — some of mine certainly did.

    1. It depends on how the book is used in class. Pagination is an issue. When the instructor says, “Turn to page 113” and 10 students have different content on page 113, it causes a lot of problems. Requiring the most recent edition is one way to solve that connection problem.

  3. Nicola —

    Starting a new thread… you can “loan” a Kindle book to a friend for two weeks now.

    Publishers will not sell you a book. They will “rent” it to you for three months or so. You want it longer? Pay more!

    I learned a lot of this the hard way in my Kindle 2 review:

    I mourn the loss of the SD card slot in the Kindle 2 to add extra capacity. I understand why Amazon deleted it, though, and it has nothing to do with how many books you can store on your Kindle. It has to do with controlling your content.

    With an SD active, Amazon cannot “control” your Kindle’s content to know what you have and have not downloaded if there is a technical problem.

    I was in the habit of always moving my dead content to my SD card — the process was slow and persnickety on the original Kindle — but I liked the idea of having books on an SD card and active content like newspapers and magazines directly on the Kindle’s base memory.

    The control issue I discovered was if you moved a book to your SD card, Amazon could not remove the book from your Kindle. They could remove the book from your online storage and from the Kindle’s active memory, but if your content was on the SD card, Amazon could see it on your Kindle, but they could not remove or edit the content.

    I discovered this “SD card content protection scheme” by chance early in the life of the original Kindle when I purchased several older books that did not have the proper Kindle formatting and I asked for a refund because the books were unreadable on the Kindle.

    http://bolesblogs.com/2009/02/25/killer-kindle-2-review/

    1. Yes, storing books is a problem, too. So many of my older friends with magnificent libraries at home have nowhere to place their books when they die. Libraries only want super-expensive exclusive editions. Beautiful books without much monetary appeal are unwanted. You can take the online sales route, but that takes time and expertise in technology and shipping. Lots of those home libraries just get thrown away by the families after the death.

  4. I had that problem when I moved here. I bought the valuable ones with me, I bought the ones I read again and a gain with me, and my reference books with me. My two daughters took others of interest that I could not bring but needed to be kept. I donated about ten boxes of paperback books to a local charity – the rest I gave to another charity to sell at a car boot sale.

    We have a similar issue to deal with at the house in my post today – going to try the on-line route with those I think, but they will be transferred up to France to do it as they are mainly in French – luckily we have a book man to help us sort them at that end.

    1. It’s hard when we love to read and collect books, but the compressive world won’t let us take them with us. As I look around me here, most of my best books are also duplicated in Kindle form, so if and when the time comes to make choices, I will only be getting rid of paper and not the actual “book.”

  5. Textbook prices really have become a cause for concern. The first sale monopoly is all too evident in the exorbitant prices of new books, and I personally have had difficulty selling them back or re-using them in later semesters. A single across-the-board price seems like a good start to remedying a business that has spiraled.

    1. I feel for you, Emily. It’s a big problem. Oftentimes, instructors get free textbooks from publishers to read and try out in the hope that the books will be adopted for their courses. Little concern is provided for the actual cost of the book to the student.