We’ve been writing about textbook rental site Chegg since 2007, when it was a newly funded startup. Their business is very simple: they rent textbooks to students at the beginning of a semester and collect them at the end, saving students the hassle of selling the books as well as sparing them from the inevitable depreciation. Only now Chegg is leaving that business entirely and going digital.
This isn’t a new idea: it’s quite similar to what Netflix is doing. Netflix began by mailing DVDs to customers, and now is slowly shrinking its DVD business after a failed attempt to spin it off into a separate company. Fast Company reports that Chegg announced a deal this week to outsource its dead-tree textbook business to another company. Students will still be rent their print textbooks through the Chegg site, but a separate company, Ingram Content Group, will own the books and handle shipping. Chegg will simply take a 20% cut.
Chegg will also let students use a digital version of the book before the print one arrives. They see providing textbooks and professional study materials online as the future, renting access to content rather than renting physical items. (See, just like Netflix.)
WHY CHEGG IS ABANDONING A BUSINESS WORTH OVER $200 MILLION A YEAR [Fast Company]
by Laura Northrup via Consumerist
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