The Cengage and McGraw-Hill merger will increase cost savings for students, according to Arielle Patrick, the Senior Vice president and Transaction Director of Financial Communications & Capital Markets at Edelman, the PR firm representing both companies.
Cengage said they currently offer a service, called Cengage Unlimited, where students buy a subscription and get access to the company’s entire catalog for the period of the subscription, instead of paying for individual titles for each course.
Cengage estimates the program has saved students more than $60 million during the 2018-2019 academic year.
“We want to make the experience radically more affordable,” said Michael Hansen, CEO of Cengage, according to an article from the Wall Street Journal.
McGraw-Hill Education said they launched an initiative to partner with colleges on “inclusive access programs,” which allow students obtain digital materials that are significantly cheaper than the price of traditional textbooks.
“This merger is based on the mission of affordability. That mission of affordability is enabled through the scale of technology,” said Nana Banerjee, CEO of McGraw-Hill Education, according to an article from MarketWatch.
“By combining, the merger will enable both companies to expand the missions of their respective affordability programs,” said a spokeswoman for Cengage and McGraw-Hill Education.
McGraw-Hill estimates that its inclusive access program saved students $55 million in 2018.
Cengage and McGraw-Hill Education, two of the largest textbook publishing companies, are merging by 2020, decreasing the number of textbook suppliers, and potentially increasing the amount of money students pay for them.
According to Pierce College Librarian Clay Gediman, this most likely means an increase in textbook prices.
“These are two big publishers, and so if they’re going to be merging you have less competition now, so trying to negotiate for a cheaper cost of a textbook is going to be pretty hard to do because who’s the competitor to negotiate with them,” said Geidman.
Assuming the deal receives regulatory approval from the Department of Justice, the two companies would combine to make the second largest textbook publishing company in the U.S.
Gediman also talked about the effect it would have in the classroom on professors trying to choose which textbook to implement into their class.
“I would say that looking at the merger from a classroom perspective, it’s cutting out on the different choices that instructors have between choosing textbooks and being able to negotiate a slightly cheaper cost for a certain book,” said Gediman. “In a way it will limit professors ability of overseeing the total cost of the class.”
According to Candy Van, the assistant manager at Pierce Colleges bookstore, the merger could also spell trouble for the store being able to place orders correctly.
“Cengage and McGraw-Hill are both very big companies who already have customer service issues,” said Van. “It’s going to make life harder for all of us because the service will only get worse the bigger they become.”
Van also elaborated on the challenges that could arise from the two textbook juggernauts merging.
“Depending on how the merger is done their platform could be a nightmare for us,” said Van. “Cataloging books by the isbn number has already gotten more complicated throughout the years and this will just add to that.”
For accounting major Trevor Becker, the possibility of textbook prices going up is a dreadful one.
“I think that textbook prices are already too high as it is,” said Becker. “If two of the biggest textbook companies are merging I don’t see what will stop them from from jacking up the prices through the roof.”
While students may be concerned about these textbook prices going up, the CEO’s of Cengage and McGraw-Hill Education are looking to keep the students in mind.
According to an article on insidehighered.com, Michael Hansen the Cengage CEO and Nana Banerjee the CEO of McGraw-Hill Education have both stated that focusing on affordability for students is the right way forward.
With the combined estimated value of five billion dollars this merger is sure to change the landscape of the textbook world. Only time will tell how big the impact of this merger has on students.