Noodle, Coursera, and 2U/edX Discussions on Educational Platform Approaches

A few weeks ago I described the emerging education platform market that could redefine market categories, initially led by Coursera and 2U / edX.

I believe that we are seeing a fundamental shift in markets this year and that MOOC and OPM no longer adequately categorize vendors. ¹ Coursera and 2U are attempting to define a new online education platform market that relies on network effects enabled by consumer-level flywheels (i.e., beyond the heavy digital marketing based primarily around institutional brands). This new market is about creating student demand and scale.

At the ASU+GSV conference the week after that post, there were two announcements that provided additional clarity on who else might attempt to enter the market and how Coursera planned to compete. The conference provided a useful opportunity to hear from the key players directly, not just through press releases.

Noodle Alters Course to Enter New Market

The first announcement to consider is the addition of Noodle, not yet as a market entrant, but with plans to do so in early 2022.

Noodle, the country’s fastest growing online higher education network, announced today the launch of a platform to help universities meet the rising student demand for online lifelong learning. Case Western Reserve University, Columbia Business School, and University of Michigan have signed on as partners, with a launch scheduled for early 2022.

In partnership with global learning technology leader D2L, AstrumU, and other best-in-class providers, Noodle’s platform gives universities more control over their content and a more significant percentage of tuition, while offering students a better supported experience, a better curated content library, and a more social learning environment.  

“Just like we revolutionized how great universities bring degree programs online, we are revolutionizing how great universities compete in the lifelong learning space,” said Noodle CEO John Katzman.  “We know the demand for courses, certificates and other non-degree offerings is massive and growing, and we know learners trust university brands to deliver them.  Noodle’s platform puts university brands front and center, and provides learners with a better experience from start to completion.”

The basic idea is that Noodle will launch this MOOC-like cross-institutional platform under the brand of each partner university, rather than with the platform brand front and center. The universities can then leverage existing website traffic and branding, and their own alumni networks, to drive enrollment in these non-degree courses and lifelong learning credentials. Noodle CEO John Katzman described two primary benefits that he sees Noodle offering: lower pricing of 15 – 35% of revenue sharing, and a better platform experience by its partnership with D2L and the Brightspace LMS.

Katzman’s presentation at the conference is worth watching for those who want to understand Noodle’s approach and view of the market. And for those who enjoy hearing unvarnished opinions directly targeted at competitors and market analysts.

Coursera Announces Lower Fee Structure for Degrees

The second announcement came from Coursera relating a new fee structure aimed at increasing the number of degree programs (read that as traditional OPM business) on its platform.

Today, we’re announcing a new fee structure to support universities planning to scale online degree offerings. The University of Illinois at Urbana-Champaign and the University of Colorado Boulder are among the first to embrace the new structure.  

We’ve served universities with one of the lowest service fees for online degree programs. With the new tiered structure, the service fee will progressively reduce from 40% to 25% of total tuition as universities grow their programs on Coursera. Universities will continue to benefit from Coursera’s global audience of 87 million learners, support for reusable content and stackable credentials, scaled teaching and grading, and hands-on learning with Coursera Labs.   

Previously Coursera’s fee for degree programs was 40%+, without significant incentives for existing partners to launch additional programs. And that is the key point – not just lower fees in general, but tiered fees to get multiple programs per partner. Coursera’s degrees business segment has been growing quickly, but it is still fairly small compared to 2U and Wiley and Pearson. They need to get bigger faster.

CEO Jeff Maggioncalda described Coursera’s approach and view of the market, althiough not directly on the new fee structure.

2U and edX Look Forward

2U and edX executives (remember that the acquisition has not been finalized yet) were also present at the conference, and 2U CEO Chip Paucek noted that edX already offered a tiered pricing structure for degree programs. Both Paucek and edX CEO Anant Agarwal were also interviewed and described the opportunity they see from the acquistion and combination.

Moving Beyond Marketing

There were a lot of claims and characterization of competitors at the conference that need additional scrutiny, but for now it is useful to get direct statements and presentations. The competition of the emerging online educational platform market is heating up – Coursera is already there, 2U and edX will be as soon as the acquisition is complete this fall, and Noodle has plans to enter the market in early 2022. The key elements that differentiate this market from the traditional OPM version is offering of free or low-cost courses to generate a large number of global registered learners, a spectrum of course and program offerings – some free, some monetized – that span lifelong learning through accredited degrees, and critically a feedback loop or flywheel to create network effects. I plan to elaborate more on the changes to the OPM market in a future post, but I will note that there are different levels of OPM-type services involved in the high-revenue degrees part of the spectrum. We need to be consistent when comparing competitors and how lightweight or full service their offerings and pricing represent. We didn’t get this consistency at the conference.