And from the real world:
Students Find $100 Textbooks Cost $50, Purchased Overseas [NYT]
By TAMAR LEWIN
Richard Sarkis and David Kinsley were juniors at Williams College,
surfing the net for a
cheap source for their economics textbook, when they discovered a
little known
economic fact: the very same college textbooks used in the United
States sell for
half price — or less — in England.
Just like prescription drugs, textbooks cost far less overseas than
they do in the
United States. The publishing industry defends its pricing
policies, saying that foreign
sales would be impossible if book prices were not pegged to local
market conditions.
But many Americans do not see it that way. The National Association
of College Stores
has written to all the leading publishers asking them to end a
practice they see as an
unfair to American students.
"We think it's frightening, and it's wrong, that the same American
textbooks our stores
buy here for $100 can be shipped in from some other country for
$50," said Laura
Nakoneczny, a spokeswoman for the association. "It represents
price-gouging of the
American public generally and college students in particular."
But thanks to the Internet, more and more individual students and
college bookstores are
starting to order textbooks from abroad — and a few entrepreneurs,
including Mr.
Sarkis and his friends, have begun what are essentially arbitrage
businesses to
exploit the price differentials.
"We couldn't understand why what costs $120 here should cost
$50-something there,"
said Mr. Sarkis, who, with Mr. Kinsley and another classmate, has
spent three years
building a Web-based company, BookCentral.com, selling textbooks
from abroad to
students in the United States. "It seemed so sleazy of the
publishers. We were sure that
college students would be shocked and outraged if they knew about
the foreign prices.
But it's been this big secret."
That is changing, though. To the despair of the textbook publishers
who are still trying to
block such sales, the reimporting of American texts from overseas
has become far
easier in recent years, thanks both to Internet sites that offer
instant access to
foreign book prices, and to a 1998 Supreme Court ruling that
federal copyright
law does not protect American manufacturers from having the
products they
arranged to sell overseas at a discount shipped back for sale in
the United States.
Before the Supreme Court decision, Americans could not take
advantage of the
discounts abroad without violating the copyright law.
Now, however, "gray market" sales are taking off on campuses.
At one prestigious university, a sophomore imported 30 biology
books from England this
fall and sold them outside his classroom for less than the
campus-bookstore price,
netting a $1,200 profit. Next semester, if all goes well, he plans
to expand the operation.
"The only difference is that they say `international edition' in
little print on the cover," said
the student, who added that he was not certain whether his project
raised any legal
issues, and therefore asked that neither he nor his college be
identified.
At other colleges, Asian students have banded together to take
advantage of
textbook prices in Taiwan, Singapore and Malaysia, which are even
lower than
those in Europe.
Many students, individually, have begun to compare the textbook
prices posted on
American sites like Amazon.com, with the lower prices for the same
books on foreign
sites like Amazon.co.uk.
The differences are often significant: "Lehninger Principles of
Biochemistry,
Third Edition," for example, lists for $146.15 on the American
Amazon site, but
can be had for $63.48, plus $8.05 shipping, from the British one.
And "Linear
System Theory and Design, Third Edition" is $110 in the United
States, but
$41.76, or $49.81 with shipping, in Britain.
Many college bookstores, meanwhile, have taken matters into their
own hands,
arranging their own overseas purchases.
"I buy from Amazon.co.uk and from sources in the Far East, and I
knew more and more
students were doing the same thing, individually," said Tom Frey,
owner of the University
Bookstore at Purdue University, who sells the new books from
overseas at the same
price as a used American book. "Then this fall, for the first time,
the Fed Ex man
told me that the students at the Indian Association here at Purdue
had just gotten
a delivery of 14 skids of books, about 50 books each, from India. I
think I'm
losing about 10 percent of my sales to overseas books."
Relations between textbook publishers and college booksellers have
been seriously
roiled by the issue.
"This has become a very hot issue since last year, when it just
seemed to explode all of a
sudden," said Ms. Nakoneczny, of the college store association. The
association's letter
to the publishers warned that the pricing structure might be an
antitrust violation. "The
sale of identical books to foreign buyers at prices significantly
lower than to domestic
buyers, while publicly stating that domestic prices are due to high
costs, could constitute
an unfair or deceptive act," the letter said. While there is no
longer protection in the
federal copyright law for the pricing differentials, the major
publishers are still trying to
stop the reimporting of texts priced for foreign markets, mostly
through contract
language forbidding foreign wholesalers to sell to American
distributors. Some have
placed stickers on covers, saying "International Edition RESTRICTED
Not for Sale in
North America" or added the cover line "International Student
Edition."
None of the three major textbook publishers — Pearson, McGraw Hill,
and Thomson
— would discuss why overseas prices are so much lower than domestic
ones, referring
all questions to Allen Adler, the lawyer for the American
Association of Publishers.
"This is a season when textbook publishers get kicked around a lot,
and they're feeling
vulnerable," Mr. Adler said. "The practice of selling U.S. products
abroad at prices
keyed to the local market is longstanding. It's not unusual, it
doesn't violate public policy
and it's certainly not illegal. But publishers are still coming to
terms with the dramatic
change in the law."
Mr. Adler contends that foreign textbook prices are pegged to the
per capita
income and economic conditions of the destination countries — and
that foreign
sales are a boon to America's standing in the world, to foreign
students seeking
an American-quality education, and even to American consumers,
since each
extra copy sold overseas, even at a low price, helps to spread the
high costs of
putting out a new textbook.
As more and more customers turn to reimporting books, it is an open
question how long
the overseas price differentials will last.
"We buy from the U.K., France, Israel and the Far East," said Bob
Crabb of the
University of Minnesota Bookstores. "As long as the publishers are
offering books at
less than half the price that's available here, we'll take
advantage of it. It's great for
students. For publishers, the marginal costs of printing a few
extra books and selling
them overseas are very, very low. But I would guess that shortly,
the sales here will
begin eating into their U.S. sales in a serious way."
Disgruntlement over textbook costs has been growing in the United
States as prices have
risen. Last month, Senator Charles E. Schumer, Democrat of New
York, announced
that the average New York college freshman and sophomore spends
more than
$900 a year on texts — 41 percent more than in 1998 — and proposed
a plan to
make $1,000 of textbook costs tax deductible. The same week,
University of Wisconsin
students demonstrated against high textbook prices and in favor of
creating a textbook
rental system.
To be sure, textbook costs, however high, are only the final straw
for American college
students, whose tuition costs and fees have been rising rapidly. At
Williams and other
elite universities, for example, tuition, room and board now tops
$35,000 a year. In
Britain, though, the cost of tuition is largely borne by the
government and students pay
much less.
For example, tuition alone for undergraduates at Harvard is
currently $26,066 a
year as compared with $1,840 at Oxford University.
In the United States, one in five students does not buy all the
required texts. And more
and more, like Mr. Sarkis and Mr. Kinsley, are willing to go to
great lengths for a
cheaper alternative. "I got mad when I found out that our labor
economics book was
something like $90," said Mr. Kinsley, who, like Mr. Sarkis,
graduated in 2001. "I didn't
think I would read $90 worth in it, so I was determined to find
something cheaper, and I
spent five hours searching on the Web."
Mr. Sarkis said Williams's campus bookstore made the high costs all
too visible. "They
really rubbed it in," he said. "If you were the highest spender of
the day, they'd ring this
little bell and say they had a new winner, and give you a lollipop.
I got the lollipop twice."
nytimes.com. |
