Well That Was a Memorable OpenEd Conference

, /by

Some conferences are more difficult to cover than others, and this year’s #OpenEd19 – the primary OER-related conference in the US – goes in the former camp. Obviously the big story was David Wiley’s announcement that this would be the last OpenEd even he (and Lumen Learning) would organize.

The End, The Beginning

With that growth comes change. That little meeting I convened 15 years ago has evolved organically in a way that has served the community fairly well. However, as currently constituted, the conference does not leverage all the energy, enthusiasm, passion, and leadership ability in our increasingly large and increasingly diverse community. And so the time has come for us to reconsider, as a community, how we wish to organize ourselves, learn from each other, and collaborate with one another. 

In order to make the necessary space for that conversation, this year’s Open Education Conference is the last I plan to organize.

Thankfully, Michael Feldstein came to the rescue with an excellent post “The Crumbling of the OpenEd Coalition”, which starts by quoting David’s post in its entirety and then frames the situation in historical and coalition context.

In my opinion, these reactions miss an underlying dynamic that makes this change more serious and difficult to patch over than it may appear on the surface. OpenEd was always at least partly an exercise in coalition politics. The attendees were a mix of people coming with different primary and secondary goals that overlapped enough for them to make common cause. That coalition has crumbled. In fact, it has been crumbling for some time. The idea that this conference could have been neatly handed off to some new steward as-is assumes that OpenEd is is otherwise tenable as-is. I don’t believe that is true.

My primary thoughts? Go read Michael’s post in full. It’s that important. I’ll wait.

Part of the reason that this conference was difficult to cover was the difficulty to cover a complex subject, with some personal biases and potential conflicts, in a productive manner. First, Lumen Learning is a client of MindWires – I’ll let the reader decide how that should influence your reading of this post. 1Typically I try to avoid writing directly about consulting clients, but for this story it’s unavoidable. Second, Michael described our joint keynote at the 2015 OpenEd, arguing that OpenEd “a brittle coalition that could fracture if the coalitional challenges were not addressed”. I’m an interested party.

The key argument Michael makes is that “the current situation is not a signal of OER’s failure but rather a side effect of its success.”

It was an encouraging sign to see the conference wrapping up with community discussions on discovering and planning the future, with much of the discussion focusing on the point expressed by Lauren Slingluff and Ethan Senack:

That is exactly right and aligns with David’s point on reconsidering as a community. There is already a shared Google Doc organizing community input (see responses here). I doubt the answer will end up being “continue the same thing with new organizers”, and I would also expect to see several communities come out that capture the needs and interest of various factions. But we’ll have to see what happens.

Alternate Views

One of my favorite sessions at the conference was a session labeled “Alternate Views on Open”, where I was expecting some more of the coalition politics and fracturing views of OER. I guess I didn’t read deep enough into the abstract, as one part of the session captured student views – something that can easily get lost in the internal debates and social media dynamics. Helen McManus from Northern Virginia Community College shared my favorite OpenEd slide, capturing the all-too-common narrative that open education advocates see and present.

The characters of popular narrative - Commercial textbook publishers as the bad guys (Snidely Whiplash), students as the victims (Nell Fenwick), and social justice-minded and innovative faculty as the heroes (Dudley Do-Right).

But McManus’ point was that this is not the view that students have for the most part.

Students are dealing with real-world problems like dealing with jobs and families while trying to get an affordable degree or certificate. Insiders tend to fall back on the narrative and forget the students. Yes, the topics overlap, but it is all too easy to focus on the narrative over the reality, especially with the changing demographics of student populations.

Here’s hoping that the OpenEd community takes the opportunity of reflection and reconsideration of coalition changes to raise the priority of students’ viewpoints and participation in the discussion.

Institutional Decisions on OPM Market: Upcoming discussions on complicated questions

, /by

Following our recent webinar with WCET on the Online Program Management (OPM) market, I am excited to lead two sessions next week at one of my favorite events of the year – the #WCET19 conference in Denver. As background, see this post addressing the OPM market.

  • Wednesday, Nov 6th at 1:45pm MT in Penrose 2 – #WCETOPM Navigating the OPM Marketplace: Picking the Right Partners While Avoiding Market Chaos This will have some overlap with the webinar but will focus more on the choices and decision-making processes that academic institutions face when evaluating OPM vendors or even deciding whether to use an OPM partner.
  • Wednesday, Nov 6th at 4:30pm MT in Denver 1-2 – #WCETOPMUnconf OPM Unconference Session Our webinar from September is available online, and we had some great questions during the webinar but were restricted by time constraints on addressing them all. During this session we plan to focus on answer the webinar questions and new questions from attendees. Come for a discussion.

Some the topics that we plan to address in these sessions, partially based on webinar questions:

  • Ideas for bringing OPM providers and schools together for more transparency and research on program outcomes;
  • The relationship between the OPM (and broader Online Program Enablement, or OPE) market and all-too-common lack of institutional support/structures vs. demand/competition for online learning programs;
  • Whether OPM critics, analytics, scholars, company leaders, and schools can come together for a collegial discussion;
  • The increasing emphasis on quality course and curriculum design; and
  • Advice for schools to consider with regards to policy, practice, and regulation when entering into a partnership with an OPM/OPE.

I don’t pretend to have simple answers for all questions – come, participate and expect a real discussion at the sessions.

Did Instructure Refute LMS Market Slowdown? It’s a matter of semantics

, /4 Comments/by

On yesterday’s Instructure Q3 earnings call, the company’s opening statement seemed to refute the LMS market slowdown that we noted just over a year ago.

Now I would like to share details on how key areas of our business are performing. Domestic Canvas is progressing nicely, on track to deliver results in line with our outlook for the year. So while some analysts have been reporting a sharp slowdown in Higher ED LMS switches we are not seeing that trend in our domestic Canvas bookings. In fact our high ED domestic bookings are on track to be up this year over last year.

Brian Peterson at Raymond James is the other analyst besides us reporting on an LMS market slowdown, using independent data collection.

Did Instructure 1Disclosure: Instructure is a subscriber to our LMS Market Analysis service. refute our argument of “a sharp slowdown in Higher Ed LMS switches”? That’s a question that we take seriously, as it gets to our reputation and accuracy of data for market analysis. On one hand, if we have big holes in the data or even wrong data, we need to describe this openly and fix the problem. On the other hand, if our data is accurate, we need to call out why we have different interpretations.

One explanation that is becoming more clear is that we’re dealing with a matter of semantics, and Instructure’s statements include confusing terminology.

Before we go on, I should clarify that what we provide at MindWires and through this blog is LMS market analysis. We describe the relevant trends on the higher ed and K-12 markets and how to best understand what might happen in the future. We are not a financial analyst firm. My interest is in transparency and accuracy in market trends and not in stock prices.

Confusing Blog Post

Instructure changed their announcement strategy on new clients to list most of them in a blog post released just after the earnings call instead of during the call. In this blog post yesterday, Instructure did list some impressive new wins, including some that we did not yet have in our data set. We’ll highlight the domestic ones, since that is the scope of Instructure’s comments on our market slowdown reporting.

Previously, a list of customers from each quarter was highlighted on our quarterly earnings call, but moving forward, we plan to dedicate blog posts, like this, to highlight the organizations that are joining the Instructure family.

  • Princeton University, Wake Forest University, and Ferris State University were big wins that we already had.
  • Prairie View A&M, CalPoly Pomona, Eastern Gateway College, University of South Alabama, and Chapman University are wins that we found out about through the Instructure blog post. Note: Upon further research we discovered that CalPoly Pomona was not a new Canvas client – they remain a Blackboard client. Their listing in blog is based on some other system (e.g. Portfolium, MasteryConnect).
  • This is a good quarter with some solid wins, but let’s get to the confusing part.

Instructure also listed several clients that moved to Canvas years ago.

  • Skyline College in California adopted Canvas as its LMS through the Online Education Initiative (OEI) 2Disclosure, OEI is a long-time consulting client of MindWires, and I facilitated the LMS selection in 2015. back in 2016/17, and in early 2018 their academic senate even produced a report describing their cost savings by using this statewide contract.
  • Laramie County Community College adopted Canvas as its LMS in 2017.
  • University of North Texas Health Sciences Center adopted Canvas as its LMS prior to 2017.

Why would Instructure list old clients in a blog about “organizations that are joining the Instructure family”? This is particularly important when there are claims and counter-claims about market slowdowns.

I asked the company for a statement, and they clarified that this post included upsells and that they would update and clarify the language.

Depends on what the meaning of “Canvas” is

One issue I see is that the definition of Canvas is changing, and these changes confuse the story about organic growth. To understand, we should look at two changes in branding that happened this year. This summer Instructure rebranded Canvas from being the core LMS to being the Canvas Learning Platform. This bundled Catalog, Practice (acquired product), and Studio into the definition of Canvas.

The Canvas Learning Platform now includes the LMS and Practice and Studio and Catalog.

This fall, Instructure further rebranded the software products from their acquisition of Portfolium. In essence, the Portfolium Network kept is name and is offered free to all Canvas clients, but the revenue-generating portions of Portfolium are now branded as Canvas. Canvas Folio Management, Canvas Pathways, Canvas TalentMatch, Canvas Outcomes Assessment. In essence, Portfolium brand is the free stuff, Canvas brand subsumes the paid stuff.

Now go back to the earnings call. The prepared remarks are highly-edited and very deliberate in wording. I would think that the corresponding blog post was highly reviewed as well, but that is not as clear. CEO Dan Goldsmith acknowledged our (and Brian Peterson’s) LMS market slowdown analysis as LMS switches, but he answered this claim as “we are not seeing that trend in our domestic Canvas bookings“. During the Q&A portion of the earnings call, Brian Peterson asked for more details. [emphasis added]

Brian Peterson

And maybe just a follow-up on the domestic Canvas bookings. I think the comment that the higher ed bookings are on track to be up this year but that’s better than I expected. Can you confirm if that’s an organic comment or does that include Portfolium? And are there any large deals for the rest of the year that could swing that figure one way or the other? Thanks, guys.

Daniel Goldsmith

So that is 100% an organic number. You know I can’t speak to the rest of the industry but as you and others have been indicating you are seeing us sort of sharp slowdown in LMS switches. This year when we look at our domestic higher ed Canvas bookings, you know we are forecasting being up in bookings year-over-year which we’re pretty excited about.

Note that Goldsmith said organic but did not say explicitly that the bookings growth did not include Portfolium stuff. Is this due to Canvas branding now including Practice, Studio, Catalog, Folio Management, Pathways, TalentMatch, Outcomes Assessment when these were not included last year? I do not know the answer to this question but have asked Instructure for clarification.

Who else saw the slowdown? Instructure

We should be clear that Instructure’s CFO Steve Kaminsky noted the LMS market slowdown one year ago in their Q3 2018 earnings call.

So for renewals what we’ve seen specifically this year is fewer large deals in the multi-hundred thousand dollar range than we’ve seen in previous years. It’s a little still too early to talk about 2019, we’ll be doing that in a few months but we have seen that and when I referenced earlier that it didn’t look like we’re going to grow domestic Canvas by much of it all, that’s what I was really referring to, that’s the key driver there.

There has been a slowdown in the LMS market, but there is a question of when it started and whether 2019 is different than 2018.

At the very least, Instructure is playing around with semantics and not directly answering relevant questions about its core LMS platform and the LMS market slowdown. Instructure is coming out with statements that appear to refute our analysis of an LMS market slowdown, but they have not (thus far) provided meaningful specifics backing up their claims. When they appear to show new clients in a blog post, the conflate upselling old clients with acquiring new clients (but kudos for promising to fix the post). The definition of Canvas is changing, and it is not clear how much of their platform redefinition and M&A activity gets included in their definition of Canvas bookings.

If Instructure is changing these definitions and bundling in new items into Canvas bookings, then I do not believe that Instructure has refuted our claims of an LMS market slowdown. And I believe it is misleading to describe year-over-year changes in Canvas without clarifying how the definition might have changed. It’s all well and good that Instructure is expanding its product line and generating new business, but we need to have clarity around the core LMS market trends.

If we find out that our analysis of the market slowdown is inaccurate, we will update our analysis and publicly disclose the changes.

Update 11/5: CalPoly Pomona is not a Canvas LMS client. See description above.

Disclosure: OEI is a long-time consulting client of MindWires, and I facilitated the LMS selection in 2015. Instructure is a subscriber to our LMS Market Analysis service.

About the PowerSchool Acquisition of Schoology

, /2 Comments/by

On Thursday we got word that PowerSchool has reached an agreement to acquire Schoology, potentially shaking up the K-12 LMS market. EdSurge covered the news on Thursday.

If approved, the pending acquisition would mark the latest puzzle piece that PowerSchool has purchased this decade. Founded in 1997, Powerschool was first bought by Apple in 2001, and then by Pearson in 2006. The publisher sold the PowerSchool to private equity firm Vista Equity Partners in June 2015. Onex, another private equity firm, invested in PowerSchool in 2018 and shares equal equity ownership with Vista.

Since 2015, PowerSchool has acquired eight companies. Through these deals, the company has expanded its product suite beyond its original K-12 student information system offering to assessment, enrollment, special education and talent management services. Schoology would be PowerSchool’s second purchase of a learning management system (LMS), after it acquired Haiku Learning in 2016. Haiku has since been rebranded as PowerSchool Learning.

I have covered Schoology in a series of posts at e-Literate, mostly focusing on their partial entry into the higher ed LMS market. I described the company and product in some detail in this 2016 post. In addition, Jeanette covered the recent Schoology NEXT users conference. In the EdSurge article last week, she observed:

Even in third and fourth place, Schoology holds unique bragging rights. While Instructure, the developer of Canvas, has reportedly never lost a higher ed customer, “our data showed that two K-12 districts became the only losses of customers that we are aware of in the history of Canvas, with both selecting Schoology in 2019: Tempe School District and Turner Unified School District in Kansas City,” wrote Jeanette Wiseman, a senior associate at MindWires, an education market consulting and market analysis firm, earlier this year.
From her perspective, PowerSchool’s desire to add a popular tool to complement its flagship student information system makes sense. “They’re taking what is a really successful LMS in the K-12 space, and pairing it with the tool that all teachers have to work with, the SIS. All the data that schools manage … everything flows into the SIS,” she tells EdSurge.

New K-12 LMS Market Data

The “third and fourth place” comment relates to our new K-12 LMS Market Analysis service, and the data helps explain why this acquisition makes sense.

Like our higher ed market analysis, we (through our partnership with LISTedTECH) track historical trends in the K-12 market, allowing a view of market trends. One view is looking at percentage of North American (US & Canada) new LMS implementations each year by vendor.

LMS percentage of new implementations each year in K-12 market for US & Canada, showing Canvas, Schoology, PowerSchool, and All others.

Some notes from this data: 1Disclosure: Schoology, Canvas, and D2L are subscribers to our LMS Market Analysis service.

  • Schoology and Canvas are strongest competitors for revenue-generating LMSs in K-12, generating far more new business than other proprietary systems.
  • Not directly shown in this view, but Google Classroom is playing an increasingly large portion of the “All Others” category. This is important, but that solution does not directly generate revenue, and this story is about corporate finances.
  • PowerSchool did not get big impact from the 2016 Haiku acquisition and is a secondary player at best in the LMS market. This position has limited their ability to truly provide full enterprise K-12 solutions and “unified classroom”. Schoology, however, does have real market power in K-12.
  • At the same time, business is difficult in this market, and Schoology has gone through layoffs since their late 2015 fund-raising round of $32 million. Their biggest competition in the K-12 market is Canvas and Classroom (primarily) and D2L (secondarily), and it takes capital to aggressively compete.

Does It Make Sense?

Seen in this light, the acquisition makes sense from a PowerSchool perspective. They can now try a more realistic approach to fully serve K-12 districts with their “unified classroom”. This is a data play at its heart, as described in a 2016 EdSurge article on PowerSchool.

PowerSchool has now added an array of services in the past 15 months, including a learning management system (through its purchase of Haiku Learning), special education reporting (TIENET), student enrollment (InfoSnap), formative assessments (Interactive Achievement) and a Canadian SIS (SRB Education). The company doesn’t plan to halt its shopping spree, Gulati says: “We’ll continue to remain acquisitive and continue innovating.”

By hooking up different education tools into the PowerSchool SIS, which serves more than 24.5 million students across the world, Gulati hopes to make data more accessible and actionable for teachers. He’s not alone: other companies such as Alma, based in Portland, Ore., also aim to combine SIS, LMS and other education data tools into one single package.

“What we’re trying to solve is the problem of data silos and fragmentation in K-12,” he explains. “Teachers currently have to go through several systems to use all the tools they need for instruction.”

The acquisition also makes sense from a Schoology perspective, as they now have a “potential” source of capital in a difficult market. I put potential in scare quotes because we don’t know how much Vista Equity Partners and Onex will invest in Schoology product and service development. Vista is well known for having a playbook on how they view software companies, as described in a 2018 WSJ article.

The goal of the Austin, Texas-based firm, which is 18 years old, is to transform business-software companies into profit machines. Behind its approach is Mr. Smith’s belief that certain aspects of the companies Vista buys are interchangeable.

“Software companies taste like chicken,” he said at a conference in New York a few years ago. “They’re selling different products, but 80% of what they do is pretty much the same.”

Derek Jones, managing director at longtime Vista investor Grosvenor Capital Management, says “their process is like a factory. A deal comes in and it gets compartmentalized, and they apply experts on each compartment. After it goes off the assembly line, the margins are higher.”

The article is largely about Vista’s founder and leader, Robert Smith. Yes, the one who said he would pay off all student debt for Morehouse College 2019 graduates.

Potential Impact on Market

Assuming that Vista follows this playbook, there will be significant changes to Schoology’s operations, and if successful the company will become more profitable. If those changes take investment, Vista has been known to put in near-term money (often debt) to get longer-term payoff. The real investment is in PowerSchool, but there are certainly signs that Schoology will be run as a separate entity, at least initially.

I can see both positive and negative effects for other LMS competitors such as Canvas and D2L (something makes me think that Google doesn’t spend too much time worrying about this type of move). On the positive side, corporate acquisitions tend to create pushback from academics, although this effect tends to be greater in higher ed than for K-12. But certainly Schoology’s competitor’s have new marketing messages to use. On the negative side, one of the top four K-12 LMS competitors is about to get a lot more financially sound and likely more aggressive. The acquisition makes sense, but that does not necessarily mean that it will succeed.

For now, the pending PowerSchool acquisition of Schoology is more evidence that corporate finances will have an outsized influence on the LMS market. This move could even accelerate other LMS companies to shore up finances. We’ll keep our watch on the market.

Update: Make sure to read this post from our partners at LISTedTECH, including a really cool graphic showing K-12 SIS & LMS shared usage data.

Reminder: If you’d like a deeper look at the data, check out our new K-12 LMS Market Analysis service.

Disclosure: Schoology, Canvas, and D2L are subscribers to our LMS Market Analysis service.

EDUCAUSE 2019: Multiple views into educational technology conference

, , /by

Last week we (Kevin and Phil) attended the Educause conference (#EDU19), the EdTech event in the US for higher education. As always, the conference leads to a flurry of meetings and social connections – with ~8,300 attendees it can be difficult to not have meetings – as well as the opportunity to get a sense of what higher education administrators are talking about and seeing from vendors. This year was particularly interesting as we were able to have multiple views into the showcase at the exhibit hall – from our consulting & market analyst role and from an academic administrator & staff role.

View of EDUCAUSE keynote session at #EDU19 in Chicago

Market Analyst View

One theme that emerged as soon as one entered the exhibit hall was the (Re)emergence of Big Tech. Attending EDUCAUSE a decade ago, it was difficult to not view technology as primary by large companies selling IT infrastructure and ERPs (student information systems in particular). The marketing spend on ERP has gone down in the past five years or so, but this year ERP is back – big booths for traditional Oracle, Ellucian, Jenzabar suppliers as well as newer ones like WorkDay, Unit4, and Unifyed. These booths were mostly clustered at the entrance, and the level of spending on the booths and the general interest were markedly greater than previous years. Add to this the increased presence of Big Tech such as Amazon, Microsoft, and Google. And the mood of these companies seemed to be more positive. As we heard at Jenzabar, they think schools are not taking transformation seriously and want to re-engineer their business processes.

Another theme goes beyond exhibit hall booths and hallway conversations – Data and Analytics. This year EDUCAUSE started taking an activist role in pushing for the usage of data and analytics as the way to enable transformation, best described in their recent article “Why Data and Analytics Matter—and Why They Matter Now“. The italics for Now is intentional, and EDUCAUSE is pushing it:

EDUCAUSE, AIR, and NACUBO created a Statement on Analytics that describes the urgency of a cross-enterprise approach and outlines actionable recommendations for heightening analytics’ role in an institution’s strategic efforts. We’ll present the statement and help you develop ideas for collaboratively moving analytics forward at your institution.

There was also a heightened sense of pushback on this idea of data and analytics as all-important drivers of change, both from a privacy perspective and an equity perspective. We’ll devote a follow-up post to the provocative counter-argument about ”Digital Redlining” posed in a concurrent session led by Chris Gilliard from Macomb Community College (Detroit, MI).

There were a large number of exhibitor booths related to Cybersecurity, reinforcing both emerging higher education needs, such as addressing ransomware and cyberattacks on college IT systems, and recent higher education trends, such as addressing workforce and statewide needs in the cybersecurity arena. Just a few specific examples of higher ed cybersecurity initiatives to watch include a) University of Albany launching its first-in-the-nation College of Emergency Preparedness, Homeland Security and Cybersecurity, b) the CalState system targeting cybersecurity as a career path, and c) University of South Florida hosting and leading the Florida Center for Cybersecurity (aka Cyber Florida). 

Oh, and continuing a marketing trend from last year, business cards are getting thicker.

Academic Staff View

While MindWires consults with higher ed institutions every day, it’s been around eight years since Kevin managed two academic technology teams on a campus. Kevin found it quite instructive to make a pass through the exhibitor hall with colleague Crista Copp, Director of Loyola Marymount University’s Educational Technology Services & Support. For sure, she had typical conversations about mission-critical systems and common campus technologies–for example, before she even got to a booth, a rep from an LMS vendor stopped her to see if LMU is happy with D2L (they are). However, in the span of 15 minutes, the two made a number of stops that highlight the increasingly diverse needs that today’s campus ed tech units support. Some of the topics that Kevin encountered with Crista that we would likely have overlooked on our own are described below.

Additional Coverage

Additional EDUCAUSE coverage worth reading:

We plan to make a deeper dive in future post(s) on the topic of data and analytics, and in particular on the push for data and analytics. Stay tuned.

LMS Decommissions: A view of lost clients and campus closures

, /5 Comments/by

One theme of our coverage of the academic LMS market over the past 1 – 2 years, both at e-Literate and in this blog, continues to be worth watching:

there are strong arguments that company financial health in 2018 / 19 for the providers will continue to have an outsized impact on the future of LMS offerings.

Both posts linked above described the overall market slowdown – where there has been a significantly lower number of LMS switches – that we first described to our LMS market analysis subscribers just over a year ago and in the blog starting this year. Our updated data over the summer shows no signs of the slowdown ending.

Another issue to consider is not just who is winning and how often, but from the opposite side. Who is losing LMS clients? Let’s first look at the US and Canada for LMS switches since the beginning of 2017, from our report this summer. The left side shows the previous campus LMS, measured by number of institutions, and the right side shows the new LMS.

LMS migrations in North American higher education from 2017 - mid 2019, showing the previous LMS on left side and new LMS on right.

Blackboard Learn lost the largest number of campuses, followed by Pearson LearningStudio and Moodle, then by D2L Brightspace and Homegrown and Sakai.

When looking at company finances, however, it is important to expand this view. One expansion is to look at global regions beyond North America. Another expansion is to include campus closures as a source of losses in addition to switches. The following chart shows the percentage of decommissions each calendar year in North America, Europe, Latin America, and Oceania combined (but note that North American numbers are the largest portion of these numbers). Decommissions is a combination of switches and closures, and the percentage is calculated on a per-year basis.

LMS higher ed decommissions per year for combination of North America, Europe, Latin America, and Oceania.

We see that two LMS end-of-life situations created by Blackboard acquisitions (where bought their competitor and eventually cut off the product line) were huge factors through 2015. WebCT was acquired in 2006 and shut down by 2013. ANGEL was acquired in 2009 and shut down in 2016.

Blackboard Learn has consistently lost customers since mid 2000s, with roughly 27 – 36% of decommissions each year coming from this solution recently. While Blackboard is the primary beneficiary of the LMS market slowdown, and its improved performance is clearly one of the causes of that trend, when looking at the data it is clear that they are still a big source of LMS losses. Consider their recent loss of long-time clients Purdue University and Princeton University. They also are at risk from several high-enrollment systems expected to complete LMS evaluation processes this year and next.

One of the most remarkable stories in EdTech is that Instructure has not lost a single Canvas higher education client due to an LMS switch. 1In terms of primary systems available campus-wide in higher ed. They have lost two K-12 clients to Schoology. But Instructure has lost clients due to campus closures, particularly from Education Corporation of America (two systems shut down) and secondarily from DeVry University (several campuses closed), mostly in 2018.

D2L Brightspace has lost a relatively small number of clients over the years, but their LMS decommissions ramped up in 2018 and 2019, largely due to campus closures. They were particularly hard hit by the closure of Dream Center systems (Art Institutes, South University, and Argosy University, all acquired from the for-profit EDMC).

Moodle has lost a consistent number of clients over the years, particularly in North America, despite it having the largest installed base worldwide. We documented a broader look at the overall changes in Open Source systems recently.

Pearson LearningStudio, formerly known as eCollege, was popular with for-profit chains and with some nonprofit fully-online programs, but Pearson shut down that system by the end of 2017.

Sakai has slowly but steadily lost clients for years, and it continues to do so with recent decisions at the University of Rhode Island and UC Davis, and potentially with several other decisions expected within the next year.

Every LMS provider loses clients, and these losses are important to understand in terms of the organization’s financial health. If you’re interested in seeing more information on the data behind these charts, we have them available with our LMS Market Analysis service.

Online Program Management: An updated view of the market landscape for 2019

, /2 Comments/by

Yesterday I had the opportunity to share an updated view of the Online Program Management (OPM) market in a webinar with WCET. There were too many questions to fully address during the session, and we are planning a joint blog post to address additional questions over the next week.

You can view the recorded webinar at https://youtu.be/uMSa3lEn_4I or at the embed below the graphic.

We have a session planned for the annual WCET conference in Denver in early November. We’d love to see you there and continue the conversation in person.

Updates since 2018

As part of the webinar I released an updated graphic of the OPM landscape, taking a broader view of this growing but dynamic market. Since the last version shared a year ago, I added a new sub-category of vendors, for-profit conversions, to capture the Kaplan (Purdue Global) and Grand Canyon Education (GCU) with its recent Orbis acquisition. I expect this group to grow, as Bridgepoint Education (Walden U) is seeking approval to make similar changes.

Some other enhancements to note:

  • The business model axis makes it more clear that there is a range of options between Tuition Revenue Share and Fee for Service.
  • 2U now shows its acquisitions of GetSmarter and Trilogy, while also add its investment and partnership with Keypath. I also am showing the entry into the bachelors degree market the London School of Economics and the more recent Institutional Suite.
  • Wiley shows its acquisition of Learning House.
  • I have adjusted the sampling of fee-for-service vendors based on market activity.

Fall 2019 Graphic

As before, please note that this view is intended to give a visual overview of the market landscape and is not comprehensive in terms of vendors represented. This is particularly true as you approach the bottom of the graphic.

Market landscape of OPM vendors, showing business model from revenue sharing to fee-for-service on vertical, and credential from degrees to certificates on horizontal.

The webinar covers additional context around this graphic.

(Source for video: https://youtu.be/uMSa3lEn_4I)

Expect more coverage soon on the OPM market and the broader world of online and hybrid education.

Update 9/28: Mentioned that 2U’s entry into bachelors degree market started with London School of Economics, which pre-dated the Institutional Suite announcement.

Thursday, Sep 26: Webinar on OPM Market with WCET

, /by

This Thursday I will be presenting and participating in a webinar with our friends at WCET on the topic of the OPM Market – September 26, 10am PDT / 11am MDT / 1pm EDT / 6pm BST.

Navigating the OPM Marketplace: Picking the Right Partners While Avoiding Market Chaos

Online Program Management (OPM) companies have been around for two decades, helping colleges and universities create scalable online programs, in a growing and important market. The OPM market is a chaotic one, however, and it would be a mistake for a school to evaluate the market without understanding the changing vendor landscape and underlying trends. Online education, in general, is entering its next generation, moving beyond traditional course designs and with a new set of stakeholders and institutional capabilities, and it is becoming more difficult to view online and face-to-face as binary choices. Furthermore, there are growing public debates about revenue-sharing vs. fee-for-service pricing as well as emerging regulatory challenges such as those seen in California this summer. In this presentation we share our view of the major trends affecting the OPM market and the implications for colleges and universities. Bring your questions and experiences. WCET is also looking to develop model agreements to share with the community and next steps will be discussed.

You can register for the webinar here (it is free and open to all), and there will be a recording afterwards.

#OPM #WCETwebcast

The Century Foundation on Online Education and OPMs: Position paper masquerading as a study

, /3 Comments/by

The Century Foundation (TCF), a public policy advocacy organization, released a new ‘study’ today about online education and the usage of for-profit service providers such as Online Program Management (OPM) companies. “Dear Colleges: Take Control of Your Online Courses” follows up from the 2017 report loosely based on public records requests for contracts from public colleges and universities. Its intent is clear from the title, as it is hardly a study but more of a position paper against the OPM market in general and tuition revenue-sharing agreements in particular.

As public and nonprofit colleges have sought to expand their online course offerings, a major industry has developed to help them with that task. These private, for-profit developers—including divisions of big publishers, like Wiley and Pearson, and firms like 2U, Academic Partnerships, and Bisk—are known as online program managers (OPMs). They operate on a contract basis, and on terms that endow them with enormous, and, at times, comprehensive control over the services offered in the contracting college’s name. There are downsides to handing over responsibilities to external, for-profit operators—downsides that make the convenience schools receive in return seem a bad bargain indeed.

The Positives

It is valuable that TCF did the legwork to obtain and share 79 new contracts between providers and public institutions, and you can follow links in the report to see a broad range of contracts. OPM, Online Program Enablement (OPE), 1OPM is for bundled service providers including marketing and enrollment services, course and curriculum design, student support, and tech / data infrastructure. OPE is a broader category of enablers that may do a subset of those jobs, often unbundled, but are still directly helping a school develop an online program.LMS, courseware, MOOCs, Continuing Education or Professional Development, and general EdTech – they have them all.

It is also valuable to see TCF’s positions laid out in five warnings to colleges and universities.

1. Don’t Buy Bundled Services

2. Don’t Bypass Your Own Faculty

3. Don’t Sign Lengthy, Unbreakable Contracts

4. Don’t “Share” Your Tuition Revenue

5. Don’t Facilitate Aggressive Recruiting

While items 1, 3, and 4 really just reword the title argument against the revenue-sharing OPM model, items 2 and 5 are worth reading. From item 5:

On average, the universities from whom we’ve acquired contracts share half of their tuition dollars with the partnering OPM, and when that OPM is a for-profit company, as most are, and is also tasked with recruiting, it is incentivized to get as many enrollments as possible. This scenario leads to the same predatory and aggressive recruiting tactics long used by for-profit colleges, but this time under the very different guise of a nonprofit or public university.25

The Negatives

It’s well and good for an advocacy organization to take a position, but for TCF to describe this report as a study is disingenuous. I’m fairly confident that the main points were written ahead of time and are consistent with plenty of TCF advocacy efforts. The data analysis is just there to backup their main arguments and to lend weight to the report and make it feel like an actual study. TCF’s Bob Shireman helped draft the California bills I described a few days ago, where one goal of the bills were to cripple revenue-sharing agreements. He has been a frequent critic of bundled OPM services, long-term contracts, and revenue-sharing. We get it. 2To be clear, I have no problem with his work in this area. I do have a problem when his advocacy leads to harm for the very students the bills are meant to protect and when TCF presents its positions as a study.

If you look at the contracts in the new batch of records released by the report, they are all over the map as described above and often are not directly related to online programs. The LMS category may be a necessary part of the infrastructure for online programs, but at most schools the larger mission is to support traditional face-to-face offerings. The same is true with courseware offerings. And several of the Continuing Education contracts listed have strong face-to-face components. It would have been far better to keep this report focused on the subject – OPMs, OPEs, and perhaps MOOCs and CE / PD companies. Those are the ones that could be argued are relevant to controlling a school’s online courses.

Furthermore, there is a misunderstanding of traditional per-student fixed fees that have long been used by courseware companies, many EdTech companies, and LMS companies (although they tend to use enrollment bands). Tuition revenue-sharing is different, basing itself directly on the revenue brought in by the school with a percentage basis going to the provider.

The TCF report has Blackboard’s contract with Eastern Kentucky University listed as revenue-sharing, but the contract is a standard LMS model. Fixed fees per year based on estimated enrollment bands. The TCF also has courseware contracts with Cengage, MindEdge, Red Shelf, and The College Network listed as revenue-sharing when they are standard courseware versions – fixed fees per student. Two OPE contracts – Smart Sparrow and 352 – are likewise fixed fee per student and not true revenue-sharing. I suspect there are even more cases of false revenue-sharing positives, but I have only have had time for spot checking on this point.

To their credit, the report attempts to focus on those product categories tied to online offerings.

As of August 2019, we received seventy-nine contracts, and of these, forty-one are directly relevant to the management of online courses. These forty-one do not include contracts that only address access to software like learning management systems. Of the relevant contracts, over half (53 percent) entitle the provider to a share of the school’s tuition.

There are two problems here.

  • One is that TCF does not list in their summary spreadsheet which contracts they consider “directly relevant to the management of online courses”. By my hand-coding, I get 14 OPMs, 10 OPEs, 2 MOOCs (and these are not the more-recent MOOC-as-OPM version), and 17 CE / PD, for a total of 43. I’m guessing that my list is fairly close, but who knows.
  • More importantly, these data points are mostly arbitrary, depending on which schools they asked and how successful they were in obtaining public records. Yes, they claim to have targeted schools with large online enrollments, but the data are mixed up between face-to-face and online programs, degree-based and non-degree based programs and courses, and contract years from 2002 to 2019. As a public listing this approach is fine. But to make constant percentage-based claims (53% of contracts, 68% of contracts, etc) implies statistical relevance and is misleading.

There is also a misreading of other reporting, particularly with the story of USC and its School of Social Work. The TCF report states:

Since USC had given over so much control to 2U, it had little control over how the program recruited, or who it enrolled: as revealed by the Los Angeles Times earlier this year, the online social work program admitted students that it was not prepared to provide with a quality education, charging them more than $100,000 for their degree in the process. All the while, USC reportedly lost money on the program, because so much of the tuition went to 2U.

This story is problematic for USC, but the argument made by TCF that the loss of money was “because so much of the tuition went to 2U” is not supported by the source LA Times article.

The university, which has contracted with the company through 2030, said the factors that led to the school’s budget crunch were “much broader” than its relationship with 2U.

“Generally, this partner relationship has been positive,” the university said in a statement. [snip]

There is much to the USC story that deserves further scrutiny, but this claim by TCF is inaccurate or at least unsupported.

Online education and OPM relationships should have greater accountability and transparency, and it is good that TCF has done the legwork to bring contracts into the public view. But it is a mistake to treat this report as anything other than a position paper from an advocacy organization, and a rather poor one at that.

California Taking a Break in Online Education Dance of Elephants

, /1 Comment/by

Back in July I wrote a mini-rant Twitter thread 1Read the terms, I believe you are are required to rant on Twitter, or at least to join a virtual mob. triggered by tens of thousands of California residents losing access to federal financial aid for their online education studies at out-of-state schools. My basic argument was that we were witnessing the consequences of a dance of elephants – triggered by activists who were targeting for-profit institutions, nonprofit conversion institutions, and Online Program Management (OPM) companies – with students caught in the middle.

The issues arose from three legislative actions:

  • California is the only state that has not joined the State Authorization Reciprocity Agreement (SARA) that seeks a common framework for student complaint handling and registration for institutions offering online education to students across the country.
  • Due to a lawsuit from consumer advocacy groups, the US Department of Education was forced to implement 2016-era rules requiring consumer complaint handling in order for students to receive financial aid, despite new rules that resolve the issue as of July 1, 2020.
  • A package of seven bills was introduced in the past year in California increasing regulation and oversight of for-profit institutions as well as online education programs.

The first and second actions led to the July loss of financial aid for students, although under intense pressure, California regulators quickly implemented needed changes to solve the initial problem. Ironically, after California rejected joining SARA due to “this lack of consumer protection for distance education students in California”, yet the entire issue this summer was based on California not having basic consumer protections handling student complaint handling. Tens of thousands of mice not enjoying the dance.

The big news of the past week is on the third legislative action, as the three bills with the most far-reaching implications for online education were put on hold, at least for the remainder of the year. As CooleyED described five days ago:

After returning from recess on August 12, the California Senate Appropriations Committee took up the package of six remaining higher education bills intended to address concerns about private postsecondary education providers in the state, sending three forward for floor action and holding three bills under submission in committee, meaning they will not be considered for further action in 2019. [snip]

Three bills were held under submission, meaning they will not proceed to a floor session or further voting in 2019. Further, unless these bills are placed into “two year” status by the Senate Appropriations Committee, the bills will not be considered in their current form for the remainder of the legislative session, which runs through 2020, requiring them to be introduced anew after the end of this year.

The three bills held under submission:

  • AB 1341, which would have enabled the California Attorney General “discretion to determine that an institution is not a nonprofit entity for California education regulatory purposes, even if it is recognized by the Internal Revenue Service as such”.
  • AB 1342, which would have required California AG review of certain transactions (e.g. sale of college, change of material responsibilities or governance) between nonprofit colleges and for-profit or mutual benefit corporations. This was mostly targeted at recent nonprofit conversions such as Purdue Global, Grand Canyon University, or (if approved) Ashford University.
  • AB 1345, which would have prevented schools from using incentive compensation agreements with for-profit corporations. This one would have had a big impact on OPM companies or any others with tuition revenue-sharing agreements.

In all cases, the scope is based on the Bureau of Private Postsecondary Education (BPPE), which governs both nonprofit and for-profit institutions operating in California, although there are many (changing) exemptions for nonprofit schools to take them out of scope.

The remaining bills going to a house vote deal with gainful employment, expansion of registration requirements for out-of-state institutions, and broadening the scope of student financial relief beyond tuition payments (think Corinthian Colleges and what those students can recoup).

What I’d like to believe happened is that state legislators realized the mistake in outsourcing the bills to activists primarily targeting for-profits and OPMs, rather than focusing primarily on students. In other words, hopefully the financial aid snafu this summer is leading legislators to better understand the stakes involved. The legislative process at work.

The question is not whether to regulate for-profits, nonprofit conversions, or OPM agreements. The question is how to do so – at the state or national level – and whether such regulation can avoid conflicting rules that further complicate the options for institutions with online education programs. And more importantly, whether the regulation helps rather than hurts students. What changed last week is that the state of California backed off from their approach to set de facto national policy, at least for the current legislative session.

By far, the best coverage on these issues comes from the CooleyED blog. I recommend reading their recent post in full for those wanting more details.