Rovia outsources putting textbooks online

Internet Strategies for Education Markets: The Heller Report, March, 2001

Rovia, Inc. (Boston, MA, www.rovia.com) offers a technology platform to allow publishers to outsource the process of making their content securely available via the web. The infrastructure is distinguished by its ability to, at the publishers' discretion, prevent users from copying, printing or saving the web pages and thus passing on that content to others. Like "Intel Inside," Rovia will power other brand names.

Andres Nannetti, ceo, says the company is initially focused on the college textbook market. Deals have been announced with Houghton Mifflin's college division and Thomson Learning's Course Technology and South-Western divisions. Nannetti says the company is also in discussions with McGraw-Hill and Pearson.

Rovia converts the text document to an HTML page that preserves the original appearance of the textbook. It also incorporates, links to all other electronic resources that a publisher has created to accompany a textbook.

Publishers can choose whether or not the HTML page can be printed, copied or saved. The system provides additional tools for annotation and highlighting. Those remarks can even be shared so that a professor can identify key points within the text or so that a study group can share comments.

Publishers can sell either the entire textbook or chapters for a defined period, typically 150 days. Nannetti says the option of offering individual chapters has been popular. The system also allows for the sale of a one-time access, but Nannetti does not wish to work with transactions less than $2 or $3.

Sales can go through the publisher's site or traditional channels such as campus book stores with Rovia's system managing that e-commerce. Rovia also intends to offer publishers expanded distribution through affiliate agreements with companies reselling or aggregating the online textbooks. The site also has its own store for all supported publications.

Nannetti points out that publishers accustomed to selling to professors can now sell the online versions, or portions of them, directly to students. Selling to professors, of course, will continue as the key strategy with the online textbooks, and Rovia provides those salespeople with demos and collaterals to leave behind. But Nannetti points to discussions with course authoring providers such as Blackboard, WebCT and the tutoring site Jenzabar in the company's efforts to create new distribution channels for students to purchase the online goods. Rovia has also hired Rob Levinson from edu.com as vp of brand strategy to accelerate their direct reach to students.

Rovia's primary revenue comes from set-up and hosting fees as well as a transaction share. Fees are negotiated individually, but Nannetti says they are reasonable and represent a cost-savings over the paper-based process. The company can restructure fees for different arrangements, such as if a publisher wants to bundle the online version with the paper book.

As the company expands it will add custom publishing features and move into new markets. For custom publishing, professors will be able to mix and match segments from a collection of Rovia academic materials and to self publish. Anticipated markets include the scientific, technical and medical markets and proprietary, corporate research. Nannetti also sees applicability of the technology to K-12 markets, though publishers will need time to bring electronic textbooks through the adoption process. He also expects most of the content to be repurposed for handhelds, both the Palm CS and Windows CE platforms, within 18 months.

Rovia's first round of funding, completed June 30, 2000, was led by YankeeTek Ventures (Cambridge, MA www.yankeetek.com). Nannetti expects to close second round by the end of March.