2 February 2017 — Education Intelligence Update
Hi everyone!
Welcome to the second issue of 2017, highlights of this issue include a cooling of US universities towards online programmes as well as the risk of hollowing out to generalist MOOC platforms by niche providers.
P.S This newsletter will also take a brief hiatus (one issue) as I take annual vacation. If the wait seems too long or you fancy something different, Laura Kirsop and I have been working on an Edtech podcast that you can listen to here
As ever if you enjoy it SHARE IT! if you have any thoughts please write back to me
All views expressed in these reports are my own and do not necessarily reflect the views of FutureLearn.
Class-Central had mused that MOOCs were moving away from free towards a mixture of paid courses — which is evidently true however a couple of items in this issue suggest the underlying strategy of universities towards MOOCs, at least in the US, is becoming more nuanced than just ROI.
It’s a positive and a negative, universities are beginning to move beyond the hype of large enrolments (positive) towards embedding online courses in their university experience (still positive) but this slowdown will probably see partners split according to their strategy — revenue generation, on-campus blended etc.
State of the MOOCS
Coursera launch “Coursera for Governments and Non-profits” — Like Coursera for Business, this is the formal proposition of what was previously done ad-hoc. Coursera have long worked with governments and Non-profits including the Singaporean government and the Carlos Slim Foundation. The difference is now there is sufficient demand for Coursera to turn it into a new business model.
Coursera’s new model will leverage their existing portfolio and in addition some partners such as University of Pennsylvania and Wharton Business School will make custom content. It ought to be lucrative, governments can pay for large numbers of certificated users who themselves will be introduced to the Coursera ecosystem. Meanwhile Coursera partners gain access to new revenue opportunities such as governments — here and here
Coursera and Udacity courses gain currency among Silicon Valley employers — interviewing.io, a recruitment platform, whose customers include Google and Facebook analysed 3,000 software engineers to see what helped the successful standout. They looked at ca candidate’s: university, previous company, whether they had done a MOOC, founded a startup, had a Masters degree and years of experience. Only 3 factors were statistically significant: University, MOOC education and previous companies worked for.
Somewhat surprisingly, having completed MOOC courses from Udacity and Coursera was the single biggest factor, with a bigger effect size than either going to a top school or having worked for a top company. Key courses were: Algorithms and Machine Learning. The usual caveats apply, correlation isn’t causation, this needs to be validated elsewhere but it hints that at least within Silicon Valley, MOOCs appear to have genuine currency in the job market — here
Brown University tried MOOCs, not fussed — Brown University which ran a handful of MOOCs on Coursera from Coding to Archaeology has ceased running them with no immediate plans to continue. The university is pivoting away from the headline grabbing ‘big enrolment numbers’ and seeking to look to MOOCs to support blended executive master’s (for mid-career professionals) and flipped classrooms to support existing students. This could be positive for MOOCs, the hype in enrolment figures was not obviously linked to tangible benefits beyond PR and finding use cases that bed into university strategy is evidently more sustainable. If Brown are indicative of a broader trend, MOOCs platforms will need to develop differentiated business models such as licensing and build support services in order to keep pace with a more differentiated market- here
Edtech
Canvas partners with Portfolium to ensure learners on their platform can create public and searchable portfolios to showcase their work — It’s only a matter of time before Coursera catch onto the portfolios game. They already have a high volume of Capstone projects through their Specializations and have a clear incentive to lock users into their ecosystem in this case via data. Recent moves to extend into government and business training could allow them to match their dream of being a lifelong learning platform with a lifelong record of that in a portfolio. Besides Udacity have done it — here
Lynda (of LinkedIn of Microsoft) price hikes leave some partners bruised — Lynda, the online learning platform with 5,000+ courses and videos has been implementing significant price hikes. The platform’s B2U arm, which is used by universities to give their students access to Lynda’s courses for professional development, has used contract renewals for price hikes between 20–60%. Lynda claim they haven’t raised prices since 2012, which may be true but most universities’ budgets are set annually with only incremental increases for such spending. At the very least raising prices so sharply in one go is poor practice. But it may also be an expression of confidence — apart from Udemy there is no comparable proposition at scale and their recent merger with LinkedIn and then Microsoft may give them confidence they can build further products and services to cement their lead in this market — here
Personalised Learning faces its first big test — Charter network Public Schools have been piloting in several schools across the US their blended/personalized learning platform (PLP). Blended because it supplements classroom teaching, personalised because when students are practicing equations or folding proteins the problems are determined algorithmically based on their success. Supporters argue PLP outsources and improves the rote part of learning, critics argue the students (K-12) are too young for this kind of self-directed learning. The pilot should provide some data, although it is a somewhat self-selected group of ambitious school districts — here
Can OER (Open educational resources) adapt to new Edtech such as adaptive learning? David Wiley, Chief Academic Officer of Lumen Learning an Edtech company argues OER adoption struggles will continue. OER are resources created by academics and teachers that use an open license. Given the high cost of textbooks, many governments and foundations have tried to increase access and availability to them as a way to reduce University costs. The problem is that OER content requires significant time investment — to find and curate it for use in the classroom, time being a commodity academics are short of. Wiley argues new innovations, especially in STEM, such as adaptive learning will exacerbate this trend because such innovations save academics time by freeing them from having to manually mark students’ work. Lumen Learning make their money by repurposing OER content on behalf of academics, if Wiley is correct they’ll need to move into the business of creating open-sourced adaptive learning — here
Salesforce incrementally expand their platform for universities — Eduventures, an education market research firm, put Salesforce, the CRM platform, on their ‘five edtech companies to watch in 2017’. Salesforce is already used by universities for student recruitment, but it’s seen as too expensive for LMS. Salesforce’s philanthropic arm partnered with University of Texas last year to trial an LMS and recently they’ve added a new student advising product — suggesting they are tentatively looking to get into the university LMS market — here
US Department of Education argues technology is critical for non-traditional students in Higher Ed — In their final report under the Obama administration, the US Department of Education argued technology was critical in allowing universities to provide for non-traditional students, the report focused on the need for more online options, new credentials, competency based education, better use of predictive analytics and more cooperation between universities and industry — here
Edtech Finance
Cybersecurity is the new coding — SecureSet Academy, a provider of Cybersecurity bootcamps gained $4m in a Series A funding round. SecureSet currently have campuses in Denver and Colorado Springs (where a significant chunk of the US Airforce is based) and plan to expand to Tampa. In the same month, the Department of Defence backed a new Cybersecurity boot camp at Wright College in Chicago. The bootcamp will take 6 months and is geared towards military veterans, on completion they’ll gain professional certification. Accenture Microsoft and Aon are partners.
Why the new coding? Demand for developers is so strong that online platforms such as Udacity and offline providers such as General Assembly have been able to build business models solely this subject area. Cybersecurity, with its yawning gap between supply and demand (an estimated 1m jobs will be created in 2017 alone) — is convincing investors the same economics applies.
For MOOC platforms this is a threat and an opportunity. The threat is specialist providers cherry picking lucrative subject areas (like Coding and Cybersecurity) building specialised platforms or services that the generalist platforms are unable to match leaving the generalist platforms with the less lucrative subject areas. MOOC platforms will need to respond to this in three ways: First and foremost, develop their own equivalent offerings in the lucrative areas. Secondly, leverage their breadth to attract learners and become one-stop shop destinations for education and finally build retention based services such as portfolios and subscription models that keep users within their ecosystem — here and here
Edtech enters the winter of finance — Phil Hill reflects on the vertiginous drop in investment and mergers and acquisitions across Edtech as covered in the last issue. Hill’s take is that investors have lost the confidence to fund when no business model is in sight and are now investing only when they can see a path to profitability — here
But it’s summer in the emerging markets — Cuemath an Indian after school maths company raised $15m (Google and Sequoia both took part) while Zuebajun raised $100m in Sries C funding in China for their app based questions and answers — here and here
The woes and woes of Pearson — Following a 30% collapse in sales in their US business, Pearson shareholders are looking for radical solutions. Investors are pushing hard for Pearson to get involved in providing more digital courses but some are suggesting a breakup of the 100+ year old firm as they remain unconvinced synergies between its businesses exists. Pearson are in a position not dissimilar to Microsoft under Ballmer, whereby the focus was on profit margins for shareholders rather than strategic direction. Like Microsoft they are now realising the cost of their indecisiveness, unlike Microsoft they’ve yet to change course — here
Archaeology VR startup raises 900K AUD — That’s right, an archaeology startup! Lithodomos is a VR company that aims to reconstruct ancient world buildings such as the Pyramids of Giza or the Colosseum and then license them out to educational institutions.
The implications of this are fascinating, will VR herald a new period of historians and archaeologists as the digital architects of virtual worlds? Its feasible as their research can be made manifest — with huge possibilities for the humanities.
The second implication is what might the business model be — will academics own design licenses like architects that can be used in different VR worlds? Too early to tell — however significant hurdles remain in the short to medium term for VR [podcast plug warning] Laura Kirsop and myself have done covered VR in further detail in our podcast — here
OPM (Online Programme Management) & LMS (Learning Management systems)
US OPM market matures, days of easy money are over — After surveying 175 universities, Eduventures found that the OPM market in the US is slowing down and diversifying as the days of using OPM for easy recruitment based revenue streams are coming to an end. Eduventures note that while headcount on online programmes grew 30% between 2011 and 2015, programs grew 110% and the number of schools working with OPM providers grew 130%. Colleges are increasingly looking to focus on student satisfaction and retention over recruitment such as blended programs that serve local populations — here
2U sign up Pepperdine to launch online masters in legal studies and graduate degrees in psychology — Law school is a saturated market if not a bubble, a point made clear when a law school in San Diego was sued by a former student unable to find a job. Have 2U tripped up? No, 2U are crafty, their law course is targeted at mid-career legal professionals — here
Navitas sign partnership with University of Idaho — Navitas, the UK based OPM provider bring their total North American partners to 8 with University of Idaho courses due to start in September 2017 — here
International Education
Trump’s entry ban is bad news for US Higher Education — Trump’s entry ban for individuals from a handful of Muslim countries such as Sudan ad Iran is very likely to reduce muslim students looking to study in the US. As if the PR wasn’t bad enough, Trump is also rumoured to be reviewing post-study work visas e.g. H1-B and the STEM optional practice training which are a key draw for many students who seek to gain work experience in the US after study. It’s likely good news for the likes of Canada and Australia who are among the top anglophone HE markets — here and here
Australia appoints former Monash Deputy VC Stephanie Fahey as head of Austrade — The Australian trade and investment commission’s appointment of an HE professional is a further signal of the strategic importance Australia is placing on its HE sector to drive economic growth. Fahey cited the huge opportunities not just in Australia but for Australian vocational services in emerging markets like India and Indonesia — here
University of Mumbai plans to open international campus in the US — The campus is aimed at attracting international students and their fees (who might not consider India as a destination) but also at capturing the Indian international student market for which the US is the top destination. University of Mumbai will look to create joint degrees with American universities. It’s a sign of emerging ambition in the Indian HE sector which is making steady progress as it climbs international rankings — here
Japan sees internationalisation as the key to a more productive workforce — Faced with stagnant growth and an ageing population, Japan is seeking to better prepare its future workforce for the global economy with internationalisation. At the university end this has meant introducing more English language Masters, encouraging international students and aiming to have more universities in the global top 100 rankings. However Japan has also sought to introduce the International Baccalaureate to 200 schools and increase teaching of IT and entrepreneurship. MOOCs should be able to make hay of this strategic shift — they are predominantly in English, international and Japan has some of the highest spending on private education in the world — here
China opens up to foreign students working afterwards — China will now allow graduates with a masters degree or above from ‘well-known’ overseas university to seek graduate jobs in China within 1 year of their graduation. China is looking to internationalise its ageing workforce as well as encourage international students to study — post work visas are a key draw of the latter — here
France sees 7% rise in international student numbers but loses market share — French universities saw a 7% rise in international student numbers 2012 -2015, rising to 309K in 2015 but other countries like Russia have grown faster to grab market share — here
Africa’s educational dilemma laid bare in Brookings report — By 2050 Africa will have 1bn young people, the largest of any continent, yet sub-saharan Africa where most of the growth is expected to occur, is not on track to achieve universal secondary education by this date. This is a problem, a lack of secondary education access will throttle tertiary education. By 2050 the vast majority of jobs will likely require tertiary or some equivalent and the African countries will need such a workforce to drive future economic growth — here
UKHE (UK Higher Education)
Institutes of Technology to return, but the devil is in the detail — Professor Andy Westwood of Wolverhampton looks at the government’s proposal in its industrial strategy green paper for ‘Institutes of Technology’. The idea is that new technical institutions will supply the highly skilled technical labour to support the government’s proposed industrial strategy. In areas such as Nuclear energy and low-carbon vehicles. Westwood is supportive, noting the UK’s vocational workforce is about 10% compared with 30% of comparable countries e.g. France. However, the UK government has gone down this road with mixed results in the past, Westwood suggests Sheffield should be the model. Sheffield’s advanced manufacturing institute works with local employers like Boeing and Rolls Royce, was supported but developed independently of the government and has its own qualifications — here
Quantifying what makes universities attractive — London Economics, an economics research consultancy surveyed 700 parents to determine in monetary terms what value they placed on different university selling points. They looked at university rankings, graduate employment rates as well as cash offers. Each additional university place in rankings was equivalent to £43, each additional percentage point in graduate employment rate was worth £122. This fits with British Council research which used focus group research to find ‘prestige’ and ‘ranking’ were the top 2 factors of US graduates.The research ought to be useful in helping universities price themselves although less palatable would be the idea of dropping their price if they drop in ranks — here and here
UCAS data shows which UK universities have grown the most in terms of recruiting 18 year olds domestically — And the answer is the ‘lower higher’ but to be specific the universities of Leicester, City Universities, Newcastle, St Andrews, Reading, Swansea and York have seen the largest increases in students applying — here
Tangents
Why do universities still use LMS systems? — George Kroner of Edutechnica argues that despite universal irritation, LMS systems are at present hard to replace. Kroner argues inertia, the need to be digital and their ubiquity wedges them in the market — here
