Students Urge DOJ to Block McGraw-Hill, Cengage Merger: 'Skyrocketing' Textbook Prices Will Continue 'Unchecked'

Student leaders from more than 30 college campuses collectively sent a letter to the Department of Justice (DOJ) opposing the proposed merger between McGraw-Hill and Cengage, two of three leading college textbook publishers.

The agreed-upon merger was announced in May and requires the approval of regulators in the DOJ. The companies claimed the merger would give students greater access to a better quantity of textbooks at an affordable price, but critics argue the opposite would occur.

Concerns about the impact of the merger on students' wallets were raised amid conversations among presidential candidates about the already rising cost of education. Over the past 30 years, tuition and fees have doubled and tripled at private and public four-year, institutions, respectively, according to College Board.

"It is imperative that those in power hear the voices of those whom they're impacting," Bri Sislo-Schutta, director of communications for the Association of Big Ten Students (ABTS), told Newsweek. "Textbook affordability is an issue that impacts students on all of our campuses."

On Monday, about 50 students signed a letter to Assistant Attorney General Makan Delrahim urging the Antitrust Division to block the merger. Students were skeptical that McGraw-Hill and Cengage becoming one company would do anything other than exacerbate the problem of students skipping buying materials because they're cost-prohibitive.

"As student leaders, it is incumbent on us to look out for our peers and to work to make college more affordable," the letter said. "...From our perspective as the primary consumers of textbooks, this merger will allow skyrocketing prices to continue unchecked."

In announcing the merger, both companies said they would remain committed to "high-quality affordable solutions." One of those solutions, which is offered by both companies, is an "inclusive access" program. A partnership between publishers, bookstores and institutions, it's designed to give students access to digital course materials at a lower cost.

Alejandra Rodriguez, a student at Florida Atlantic University, credited inclusive access with making course materials more affordable in a video on the company's website, something that, as a financial aid recipient, made her grateful.

Cengage also offers Cengage Unlimited, which grants students access to multiple digital titles and materials for a set subscription price. Affordability initiatives, such as unlimited and inclusive access, during the 2018 school year saved students more than $110 million, according to the companies.

mcgraw-hill cengage merger college students oppose doj
Textbooks sit on the shelf at Quantumbooks August 16, 2005, in Boston. On Monday, student leaders sent a letter to the Department of Justice urging it to block the proposed merger of McGraw-Hill and Cengage. Joe Raedle/Getty

However, students argued these programs remove the ability for students to conduct price comparisons, purchase used books and sell their materials at the end of the semester.

"The rising cost of tuition is already a financial barrier for students and the additional costs of textbooks increase the financial barriers to higher education," Sislo-Schutta said.

Students weren't the only ones to be critical of the merger and a second letter sent on Monday, signed by more than 10 consumer advocacy organizations and professors, also urged the DOJ to block the merger. The letter targeted the merger for reducing competition, noting that the textbook marketplace was already "dominated by a handful of giants." Along with a number of concerns, many of which were expressed by the students, the letter also claimed the proposed merger violated antitrust law.

If the two companies were to merge, the letter alleged they would control at least 40 percent of the higher education textbook market, according to the Herfindahl-Hirschman Index. A source close to the company claimed to Newsweek that market share was under 30 percent.

"We are working closely with the Department of Justice on the HSR review of the transaction. The transaction is expected to close by early 2020, subject to customary closing conditions, including receipt of regulatory approvals," a spokesperson for the companies told Newsweek. "The companies remain confident that the transaction will benefit our customers."

Moving forward, Aidan Sova, ABTS executive director, told Newsweek the organization will continue to advocate for affordable textbooks and won't "stay silent on this pressing matter."