In a notable departure from its traditional sales model, publisher Cengage announced an all-you-can-read subscription model earlier this year -- setting one price for access to all of its ebooks and course materials.
Speaking to investors on Wednesday, Michael Hansen, CEO of Cengage, said that initial sales of the Cengage Unlimited subscription were “in line with expectations.” Hansen reported that more than 500,000 students had purchased an Unlimited subscription this semester, with most students opting for the shortest subscription duration of four months, which costs $119.99.
Cengage made $77.1 million in gross sales from Unlimited subscriptions this quarter, Hansen said. The publisher invested $18 million in the launch of Unlimited, which included building new technology, bolstering the sales team and marketing the product to students and faculty.
“We knew we were taking a calculated risk as the first mover,” said Hansen. But the all-access subscriptions are already “resonating with faculty and students,” he said.
Though pleased with initial sales, Hansen said Cengage “still has a lot of work” to do to educate institutions about the subscription model.