The educational and institutional markets for non-fiction video get above-average grades from the documentary producers and distributors who supply them. Perhaps not as glamorous as retail, these markets – comprised of school systems, libraries, civic groups and even prisons – have a ravenous appetite for materials to enhance learning.
While the baby boomlet, a robust economy, and a call to wire schools for the Internet have given U.S. school districts an influx of cash to bulk up multimedia needs, shrinking school budgets in many countries, such as Canada and Germany, are causing a re-evaluation of how video and other supplemental materials can be used in the classroom.
In the U.S. in 1997, reported sales of videocassettes for students aged 5 to 18 (kindergarten to grade 12) were us$105.9 million, according to Cowles/Simba Information. However, it’s difficult to gauge the true size of any domestic market because reported numbers fail to reflect out-of-pocket purchases made by teachers or acquisitions credited to other budgets.
The fact that teachers are making many of these purchases reflects major overriding trends in the market: the devolution from centralized purchasing to site-based management, decreasing prices as some companies reduce or eliminate public performance rights fees, and new deployment strategies for classroom video use.
No one company has cornered the U.S. educational electronic publishing market because it’s simply too broad. New Jersey-based distributor/producer Films for the Humanities and Sciences, the reputed leader in the video field, had only a 1.7% share (US$11.5 million) of business from U.S. kindergarten to grade 12 electronic materials publishers (software, videocassettes, videodiscs, paid satellite programming, etc.), according to a 1996 Cowles/Simba study.
Market fragmentation allows smaller companies to flourish alongside their better known counterparts, as they can specialize in types of programs that larger companies don’t sell, such as safety films. ‘No one dominates this business,’ says Bill Ambrose, president, New York-based Ambrose Video Publishing. ‘You can’t supply all schools with all things.’
Video has supplanted 16mm film and filmstrips in the classroom, but now competes with computers, cd-roms and the Internet for supplemental use by teachers. More choice has democratized purchasing decisions. When 16mm was the only available option, its prohibitive cost required purchasing decisions be made from a centralized regional or district level.
The easier availability and lower cost of video has empowered teachers to make buying decisions based on their individual curriculums needs. ‘From a marketing standpoint, it’s more difficult,’ says Don Jalbert, vice president of Virginia-based PBS Learning Media, ‘but I would suspect that an individual decision-maker within a school is probably better skilled to make decisions at the building level.’
John Hoskyns-Abrahall, president of Pennsylvania-based Bullfrog Films, disagrees. ‘One of the advantages of the regional system is that there are professional people evaluating the material against the curriculum,’ he says. ‘As the regional system crumbles, who’s making those decisions? Teachers may be buying inappropriate stuff or the same things that a teacher in an adjoining room is purchasing.’
The relationship between schools and suppliers varies around the world. For example, while England’s Channel 4 sells its educational programs to schools in packages, i.e. five related 15-minute programs for £15 (US$24), many British schools bypass video acquisition by purchasing an annual license from the Educational Recording Agency (ERA), which allows them to record any radio or TV broadcast from participating companies (including the BBC, Channel 4, ITV) for classroom use. The annual era rate, which varies based on the number of students and the type of school, is 21 pence per primary student per year and 42 pence per secondary student for private schools. The agency negotiates blanket license fees for public schools, with discounted rates of up to 30%.
The U.K. method is similar to the U.S. cable industry initiative, `Cable in the Classroom,’ which designates select commercial-free programming for teachers to tape and show in the classroom, free of charge. While not viewed as a sales opportunity, the initiative is as a way for cablecasters to market their tapes. ‘Teachers know Assignment Discovery [Discovery Channel's `Cable in the Classroom' program] and the brand awareness of Assignment Discovery has helped us be a success on the video side,’ says Mary Rollins, director of marketing, Discovery Channel Education.
In Sweden, U.K.-based itel sells videos to around 70 regional educational centers through its local distribution partner Filmo. Schools can then rent the videos from each center. In the Netherlands, Dutch pubcaster avro provides its shows to schools for no charge. ‘It’d be difficult as a public broadcaster to justify asking for a lot of money from schools to use our programs in their educational programming,’ says avro’s Wolter Braamhorst.
Discovery, which began selling video to the educational market in the U.S. in 1995, has sought to expand internationally over the last year. Work is currently underway to determine the most appropriate programs for local curriculums, with the cooperation of distributors in Latin America, Australia, Japan and other Pacific Rim countries, local education ministries and local Discovery Channels.
RIGHTS AND WRONGS
Perhaps no issue has vexed educators around the world more so than public performance rights, a license that legally permits programs to be shown to a non-paying, non-theatrical audience. Public performance rights, which are paid to the producer via the distributor, are granted when schools buy videos through educational/audio-visual (AV) distribs; performance rights aren’t granted if the same video is bought at retail (with exceptions). The result often is a two-tiered pricing system.
In Germany, budget cuts have eaten into AV funds, creating a gray market in which many teachers tape or purchase programs at retail without clearing the rights, says Reinhold Ferdinand, head of acquisitions and sales for ZDF Networks, which sells about half a million Deutsche marks (US$270,000) of videos to schools annually. ‘Normally, we take a license fee, about dm 200 (US$110), but teachers tell us that it is too much and the school doesn’t pay it,’ he says. There is a growing concern that illegal taping will persist until a more affordable system comes into use within current budgetary constraints.
A gray market is also a problem in France, where budget cuts and rights issues are compounded by paperwork hassles, according to Hughes Peysson, publishing manager for pubcaster La Cinquième. ‘Often schools are not buying tapes because it seems too difficult to go through,’ he says of the bureaucratic process that can take up to six months for approval. ‘Teachers are preferring to buy it on their own at [retail] because they can get it right away.’
Canada has long had a two-tiered pricing system. Companies that started distributing 16mm are struggling to adjust to new economics in which independent distributors or American companies can sell videos with full rights at lower costs. ‘A corporation still may pay CDN$1,400 [US$950] for a training video, but a school board isn’t doing that anymore,’ says Doug Atkinson, director, Toronto-based Canadian Video Services. ‘If there are two videos: a Canadian with public performance rights for CDN$200 [US$135], and an American for CDN$50 [US$35], they’ll go with the American.’ As in the U.S., sales of videos with accompanying public performance rights thrown in, at no extra charge, are on the rise in Canada.
‘Generally, when the education video market is very well established, people know that they have to buy the rights,’ says Yvonne Body, vice president of sales, New York-based Tapestry International, which works with educational distributors in Australia and the Pacific Rim. South Korea, China and Italy are among the countries where the struggle to differentiate between the educational market and the home video market continues, she says.
Although a loophole in the U.S. copyright law technically permits educators to buy a video at retail for classroom use, most companies push tapes with full public performance rights – at a higher price than their retail equivalents. Special perks, such as teachers’ guides and hard cases, are often thrown in as an added incentive.
Two-tiered pricing has created a divide in the distribution community between traditional suppliers, who charge higher prices for public performance rights, and newer ones, who specialize in video (or who can recoup costs through other ancillary markets) and tend to include the rights for free. ‘Even though you have the right to charge higher prices, I think it’s unfair,’ says Jeff Siegel, manager of special sales, New York City-based New Video, which distributes A&E’s home videos. ‘You’ve seen prices drop as teachers have become much more educated about where to purchase things.’
Among the U.S. companies that don’t charge extra for public performance rights are A&E, WGBH Boston, Philadelphia-based Library Video and National Geographic. ‘We always try to offer educators the best price that we can, so we offer it at the same price we offer to a consumer, unless there’s a significant set of additional materials that would increase the price,’ says Ericka Markman, vice president, Washington, D.C.-based National Geographic School Publishing. A&E agrees that it makes sense from a business and branding point of view not to charge two different prices.
Discovery employs a two-tiered system, but tries to keep the differential to a minimum, some $10 to $15 above retail cost. PBS offers single videos with full public performance rights for about $69.95, as opposed to $19.95 if purchased at retail. PBS informs teachers that a lower cost home video version of programming does exist that can be shown in schools under the copyright loophole, but prefers to sell the AV edition with full public performance rights and added-value bells and whistles. Films for the Humanities, which lacks ancillary retail opportunities, offers videos in the $100-$125 range.
Classroom video use supplements lesson plans designed to reach increasingly diversified and media-savvy students. ‘Kids learn in different ways and have different needs in the classroom. To be effective, a teacher needs a more mixed-media platform,’ Markman says.
In England, the BBC (the country’s largest supplier of educational videos) once had a great deal of influence over what was being taught in the classroom, prior to the establishment of a national curriculum ten years ago. If the BBC presented a program on Egypt, for example, and supplied teachers with related support material, Egypt would likely find its way into classrooms. Teachers now use TV much more selectively, according to the BBC’s head of educational publishing, Juliette Waugh.
The BBC, National Geographic and Discovery are among the companies striving to provide complete multimedia solutions for educators within a singular packaged product: a combination of teacher’s guides, videos, CD-ROMS, transparencies and other hands-on activities that respond to the needs of today’s students.
Classroom computer usage is not expected to diminish video’s reign as the key educational supplement, mainly because of cost. One video for an entire class is much less expensive than software programs for individual computers. However, in such countries as Canada and England, money that traditionally might have been earmarked for av is being spent on pcs.
‘Our basic product has been video, but we’re slowly moving toward CD-ROM product,’ says sales director Lynn Huck of Edmonton, Canada-based Access TV. ‘That’s been a dramatic change in the last 18 months.’ Even though teachers have been asking for more CD-ROM product, many U.S. publishers have gotten out of the CD-ROM business because they feel the return on investment hasn’t justified the production cost.
How video is used in the evolving interactive classroom is changing. ‘We are considering how best to deliver educational programs,’ says Simon Fuller, education director, Channel 4 Learning, ‘and whether television will be the most successful medium because it may not provide the level of interactivity that other systems can provide.’
It is generally accepted that videos that run under 25 minutes are the most effective for classroom use because they allow teachers time to introduce and discuss materials. However, since many videos run over 45 minutes, more teachers are preferring to show clips instead of complete programs.
‘Teachers are buying multiple programs on one topic and using clips from those programs to teach the course,’ says Frank Batavick, VP of acquisitions, Films for the Humanities. ‘They are demanding clips, but we’re not in the clip business. We have a built-in problem, because every teacher has different needs.’ He likens the trend to a similar situation in the textbook business ten years ago, when college professors started to create customized textbooks by buying copyrights from publishers and combining selected chapters of different books as a single text.
a&e doesn’t edit its programming for the school-period format because of the potentially high expenses that come with re-clearing footage and re-editing programs. Discovery alters its programming for schools, especially for the elementary market, often re-doing the narration. According to Rollins, Discovery sometimes uses children for voice-overs, as they feel the sound of an older or foreign-sounding voice could confuse younger learners.
PBS has been the most aggressive in meeting teachers’ needs to find clips. The PBS Videodatabase is a subscription service, started last year, in which schools have access to over 300 PBS videos. The service is accompanied by an on-line database (or a printout for schools that don’t have Internet access), which offers a keyword search video index of all the programs that come with the subscription, lesson plans, student handouts and other materials.
‘We feel this database is going to be the central part of our business on the av side,’ says VP Don Jalbert, PBS Learning Media. The initial investment is US$3,500 for the first year, which includes about 300 programs, and $3,000 a year afterwards, which includes additional videos and updated indexes. If it is purchased by a regional media center, teachers and students at different buildings can access it via a password. Currently, the video library concentrates on history and culture, but pbs hopes to expand it to other subjects in the future.
At the university level, video is becoming the teacher. The growing popularity of open learning (tele-courses) around the world is opening up opportunities for producers to create programs that work as both on-air broadcasts and tele-courses.
Toronto-based Sleeping Giant Productions has been aggressive in this area, partnering with several Canadian institutions, including the University of Guelph and the University of Alberta. Sleeping Giant seeks financing to produce the series, as it would with any other production, and sells it for broadcast. The university, which acts as a de facto coproduction partner, doesn’t pay any production costs, but supplies the core intellectual property and material to be used as the basis for the series/course. The completed series is given to the university, which uses it as part of the curriculum for degree and non-degree students. In return, Sleeping Giant earns about 10% on the cost of every student who signs up for the university course.
For example, Death: A Personal Understanding, a ten-episode series that airs this fall on several Canadian channels (such as Access TV, Vision and Canal Vie), is a third-year psychology course at Guelph. Virginia Gray, director of open learning, University of Guelph, says that the over-the-air broadcasts serve as vital marketing devices to bring additional students to the class, many of whom take it for pure interest.
Gray believes that open learning is a key business opportunity for universities in the future. ‘Open learning means life-long learning,’ she says. ‘What’s absolutely key is that people can do this at their own pace and convenience.’ Sleeping Giant has four other open learning series in production or in the development stage, with several institutions.