Today Apple re-invented textbooks. For iPad owners, educational material is going to be a lot cheaper. For publishers, books are going to be a lot easier and cheaper to make. This has huge implications; here we address the top three:

1. Apple makes lots of money: The education market is huge and Apple has just undercut everyone else. All textbooks in the iBooks store will be $14.99 or less (updated: this cap does not apply to university textbooks). Which, you will know this if you are a student, is a massive price reduction (maybe even as high as 80 to 90%). Shockingly, it may now make economic sense for students to buy an iPad in order to get cheaper books. And students, as Apple well knows, are a huge market.

2. Textbook quality goes up: Making a book, let alone an interactive one with animations, videos and social features, is extremely difficult. And, again, expensive. Apple has released free software that will a) make it cheaper to make a book and b) make it easier. Publishers are going to be able to spend a lot less on production and a lot more on content. That fact, coupled with the now negligible distribution costs, means we can expect better quality products, with more frequent updates, from book publishers.

3. Apple destroys Amazon: If there were any doubt, Apple has demonstrated today that its sights are firmly set on Amazon. iBooks has yet to see any serious success, but if Apple can hook kids and publishers on their platform they could own the eBook world. Just as they now own the world of digital music.

This is a very, very smart company.