The MOOC market (Massive Open Online Courses) has exploded. This month Coursera landed another $20M in funding, bringing their total investment to $63M (even more than edX‘s original $60M funding by MIT and Harvard). Why all the investment? Because this market opportunity is massive and building these online courses is expensive.
There are more than 2 billion potential learners around the world today, and more than 70% of these are unable to afford a college degree. And today a college degree is more important than ever: McKinsey believes college-educated workers will have a three-fold advantage in salaries and opportunities by 2020.
Adding to this hot market for college, there are hundreds of millions of post-secondary students and professionals who will flock to branded degree courses in a huge way. As the MOOC certification market matures these individuals will find online education more and more valuable every quarter (note below that LinkedIn is helping with this process).
While many people have commented on the low completion rates for MOOCs and even Sebastian Thrun of Udacity is unhappy with his courses’s impact, this space is poised to grow very rapidly. Even Google has put their engineering team onto the edX platform.
There are more than two billion potential students around the world and more than 70% of them cannot afford higher education at all. These folks, coupled with all the post-secondary students and professionals out there, will flock to branded degree courses in a huge way. And degree programs are coming. AT&T’s experiment with Georgia Tech and Udacity to deliver an online masters degree in computer science appears to be going well.
The MOOC vendors are trying lots of interesting things. Coursera now offers business programs from Wharton and Rice. EdX is licensing (releasing) its platform to any educational entity or government who wants to produce and distribute education. Udemy has expanded its corporate online learning offering. And the fidelity and quality of these programs is improving every day.
Not to be left out, LinkedIn is jumping in too. Two weeks ago LinkedIn announced partnerships with Coursera, EdX, lynda.com, Pearson, Skillsoft, Udacity and Udemy - creating a “Direct to Profile Certifications” beta program.
This new feature could be big: imagine your online LinkedIn Resume storing all the completed courses and certifications you’ve achieved. That’s a way to really get credit for all the online education you’ve completed.
The corporate training marketplace is beginning to pick up MOOCs as well. We just surveyed our research members and more than 70% told us they are interested in exploring the use of MOOCs for corporate training. Coursera, Udacity, Udemy, and edX are all starting to license courses and their platforms to businesses and for-profit education companies, a trend which will continue to grow. For example:
Bank of America partnered with Khan Academy to create BetterMoneyHabits.com, a cobranded MOOC to educate consumers on personal finance. SAP developed the openSAP MOOC platform to educate its ecosystem of developers and partners on SAP technologies.
Yahoo is reimbursing employees for the cost of verified course-completion certificates from Coursera. Online retailer 1-800-Flowersannounced it will create an online education portal on the Udemy platform for its network of independent florists. The portal offers a mix of general business courses and custom-developed coursers on topics specific to the floral industry. Tenaris, a $10 billion manufacturer of steel pipes, has licensed edX’s software platform and course materials for its employee learning. The World Bank, International Money Fund, GE, and several major government ministries are licensing MOOC content and technologies for their constituents.
And new MOOCs are popping up. San Francisco-based NovoEd is now offering courses directly from Stanford Business School. Berlin-based iversity is offering a wide range of courses from European educational institutions.
Online training and education is certainly not new: we’ve been following this space since it started in 1998. Over the last 15 years billions of dollars have been spent on corporate e-learning, and much of it evolved into mandatory compliance training. Just as businesses learned to develop and adapt online learning for training, so will the MOOC providers learn to adapt more formal education for the video-based online experience.
Unlike traditional corporate training, MOOCs leverage world-class instructors and are taking advantage of video, collaboration, machine learning, and simulation from the start. Their platforms are focused on delivering a learning experience, not just a course catalog. Today only 30% of employers believe a MOOC course represents a valid completion – but that’s a major achievement in itself.
While this is still a young market, the demand is there and we expect it to grow exponentially in the coming years.