What price MOOCs?

Massive Open Online Courses (MOOCs) are all over the news at the moment, with mainstream media such as the New York Times, Forbes and the TES featuring it widely. The L&D and Higher Ed communities, too, have pitched in with their views. Debate has ranged widely on the pedagogical quality and style of MOOCs, on the technologies, on who actually started them and on some of the mind-blowingly huge numbers of students involved. There are also some in L&D who say that MOOCs have little to do with workplace learning (and they are very wrong).

But one topic has received less notice – how will MOOCs be made to pay?

A twitter conversation last night brought this to my attention. My sub-140-character response to the question last night was ‘Freemium model surely?’

I went to sleep wondering how I would make MOOCs pay if I ran a university and this morning awoke with an expanded view of my ‘freemium model’:

Some MOOC business models by Donald H Taylor

In the not-very distant future, I believe that Higher Education and Further Education / Community College providers will offer a range of courses from the free to the premium priced, and delivered entirely or partially online. The balance of offerings will subsidise the free end of the spectrum which will serve either as loss-leader offerings (for lesser known institutions) or pro-bono work for the great and good. This reflects the views of the Gilfus thinktank in this area.

There is a general blurring of boundaries in education, with two boundaries in particular affected.

First, the plurality of offerings above reflects the current blurring of boundaries between private and public provision and between academic and workplace boundaries. Offerings will not be positioned purely in the academic space, but will include offerings (labelled ‘CPD for Continuing Professional Development’ above) which are explicitly tailored either for particular employers or professions. Other offerings, such as the Diplomas and Certificated Courses in the table above could also be positioned for those in the workplace.

Second, this is a global market. In such a market, early movers and those with a high brand value (Ivy Leaguers, Oxbridge), and those using English as their medium for delivery, have a tremendous advantage for the present.The ramifications of global provision will become more acute as pricing models settle down. Every single provider of training and education – from private training companies to community colleges to the grandest universities – in every country, will be positioned against other, often very dissimilar providers, elsewhere in the world. That in itself will have further implications, not least on government policy on funding education. How will tax payers countenance funding institutions when it isn’t clear that nationals are benefiting?

Nobody really knows how the MOOC market place will play out, but really this conversation is about much more than the current,”push” model of online courses that has so grabbed the attention of the world’s press. It is about the future of education and workplace learning across the world.

So, does all this matter to workplace L&D? Absolutely. If, as L&D professionals, we don’t feel qualified to consider financial models, or interested in them, it’s time to change. MOOCs are a symptom of something larger – the seismic shifts that are taking place in our profession. In this global world we need to be fully engaged and aware of what’s going on. In a few years’ time you may be asked to justify your training course against one  provided by Harvard,   by a local college in Hyderabad and by an online training company in Singapore. You’d bet start preparing your answer now.

23 responses to “What price MOOCs?

  1. Pingback: Joachim's Blog » Archiv » What price MOOCs?

  2. I couldn’t agree more. There’s a great need for a business model for MOOC-like education. I’m not sure Udacity and Coursera are quite there. I think particularly providing space for physical meetings of people (ie space and time) could be quite valuable. I’ve been writing about MOOCs on http://researchity.net arguing for MOOCs as a viable model (and running a MOOC-like course of my own) so the more options we have for making open courses sustainable, the better.

    But I don’t quite understand what the difference is between Open Courses and Certified courses is. Couldn’t there really just be one course and multiple options of engaging with it (ie. getting certificate and paying, etc.)

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  4. I agree with Dominik about multiple options of engaging with it. Instruction and assessment/certification don’t necessarily have to be inextricably linked. Let MOOCs concentrate on the quality of instruction and the learner experience, and let people who want a credential of some sort pay separately. Either the MOOC provider can produce a way to certify attendance and participation for a low-cost certificate, or the learner can go to a third party to take an exam for credit (there are plenty of exams out there available for credit).

  5. Mika and Dominik thanks for the comments. I think we are in agreement. The table above refers to how products would positioned in the marketplace and I quite agree that the only difference between an open course and a certified one might be payment for a certificate or for a certificate plus assessment. MOOCs in their current free, open state are only the beginning of what will eventually be a complex, wide set of offerings, based on the same content, but packaged differently for different markets.

  6. Excellent post, Don. I think your freemium model is inevitable, and the implications mind-blowing!

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  9. I am an engineer and know how to calculate income .
    Assume MOOC charges $ 100 per course then from 10,000 people you collect $ 1,000,000 you make a huge profit. Cost is much less than $ 1,000,000
    If MOOC charges $ 50 per course then from 20,000 people you collect $ 1,000,000 again you make a huge profit
    If MOOC charges only $ 10 then you need 100,000 people to collect $ 1,000,000 . Well even at $ 10 you can collect 100,000 people in 5 years or 10 semeste if you are MIT or Harvard or Berkeley.
    BEAUTY is there . .
    Can you see the the greatest efficiency of NEW ONLINE from MIT, Harvard, Berkeley . It is very easy for them to gather 100,000 astudents in 10 semesters.

    KEY is SCALE, number of students. TYhe more you have the more profit you make , more students do not need more building, more heating, more parking space , no even teachers . Please just THINK .
    They are smart. They know cost will be small, so fee must be small too.
    That is the greatest social responsibility anybody had .
    Thanks billion MIT Harvard Berkeley

    So far marketing strategy of Coursera is terrific.
    I urge to increase number of courses offerred by MIT and Harvard and Berkeley and Uni of TEXAS too .

  10. Muvaffak Gozaydin, thank you for your comment. I don’t think I’m disagreeing with anything you say in my blog entry above. The only thing I would add to your calculations is this: with such massive numbers involved, and such low barriers to entry, we can assume that there will be many more entrants into the marketplace, and this will have three effects:
    1) It will drive prices down overall
    2) It will increase the range of different offerings available.
    3) There will be some offerings which are complex, sophisticated and high-value.

    • Thanks Donald
      I am also glad that I found some one thinking like me .
      Well if we reach the price level of $ 10 per course everybody will want to go to MIT Harvard . Here the problem is ” not everybody can handle the hard courses of MIT and Harvard designed for the smartest people of the world ”

      So I find the solution that Uni of Illinois, Uni of Michigan, Purdue and similar schools should be giving also NEW ONLINE Courses at $ 10 or so .
      So that less intelegent people can also graduate from college. But not an inferior college .
      As you say some very bad schools may provide at $ 1-2 per course,
      in that case I say ” I hope people are smart enough not to be cheated that way ”

      Do you think MIT Harvard will provide degrees as well after 5-6 years as
      M ITx and Harvardx degrees .

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  12. Muvaffak Bey, I think that within 5-6 years all universities will be offering fully accredited degrees offered through a mixture of delivery channels, including a large part – possibly the majority – online. That’s the column on the far right of my diagram.

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  15. Thanks Donald
    Where did you teach in Turkey.
    I am so glad I found a gentelman thinking like me .

    Let me add though only edx will be alive more will join to edx as well. I hope they will select carefully .

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