UCI has an involvement with MOOCs since joining Coursera in September 2012. So far UCI has offered 15 courses signing up over 700,000 students (with the usual non-start and engagement rates). We also experimented with a MOOC based on the AMC series the Walking Dead, which enrolled over 65,000 students. ACE and Coursera chose two of our courses for the first group of courses to received ACE credit, and we were the first University on Coursera to offer a course sequence, UCI’s Virtual Teacher Course Sequence.
UCI has been involved in the OpenCourseWare movement since 2000 when we received the first of several grants from The William and Flora Hewlett Foundation. In November 2001 we opened our OCW website following some parts of the model set for the world by MIT. The UCI OCW http://ocw.uci.edu) currently offers 82 courses including graduate and undergraduate degree courses and professional level courses for continuing education. Unlike most institutional OCW sites, UCI’s site offers educational experiences designed to target deserving audiences. Our site also incorporates some features unique to UCI.
Over the last 13 years the supply of open educational materials has expanded to such a mass that it had to be taken into account by higher education. In a curious reversal of classic economics, this large supply has created demand. The availability of such a large number of high quality learning assets demand use.
MOOCs brought together two forces. The first was the huge store of open education that has become available over the last ten years. The second was the intense public pressure to bring down the cost of higher education. When two Stanford professors offered the first publicly recognized MOOC in July, 2011, it caught the public’s attention. With Stanford’s effort, the notion of high quality became the catalyst for the recognition that free (high quality) learning assets could reduce the cost of higher education.
Gartner’s technology hype cycle curve clearly applies to MOOCs. We have recently been hitting the “trough of disillusionment” as universities rethink their involvement in MOOCs. But make no mistake; MOOCs (in their evolved form) are here to stay along with other forms of open education. Every university, to maintain its reputation, will have to both produce and use OER.
MOOCs and the discussion around MOOCs have certain dynamics. The early involvement in MOOCs symbolized a university’s willingness to adopt new technology. This symbolism resonated particularly with governing boards, usually composed of business people, who generally view faculty and all university administrators as resistant to change.
The huge discussion around MOOCs proceeded through the usual initial hype and now seems to be going through the trough of disillusionment. But whatever the direction of the discussion and however strong the anti-MOOC forces are, MOOCs and MOOC providers continue to proliferate.
MOOCs are generally criticized for being what they are not and the metrics used to value them are inappropriate (completion rates). Another dynamic was illustrated by the Gartner curve. A third dynamic was the criticisms of MOOCs 1) for not being really open 2) for not being online courses 3) for threatening higher education and faculty roles. A fourth dynamic: the pressure to provide academic degree credit for MOOCs. Another dynamic, more recent, is the shift from degree-based courses to continuing education or corporate education. Sixth: the large numbers of overseas and well educated, non-degree seeking students. Final dynamic: clear evidence that students want to chose their own levels of engagement.
Early business models suggested by the founders of EdX, Udacity, and Coursera included large entrance fees paid by universities to be part of an exclusive group of universities providing high quality courses. This was central to the founding of EdX but quickly went by the board when the supply of inventory slowed down and the number of universities willing to pay the price did not materialize. Other ideas included students paying for some form of learning verification or certification. Coursera’s SigTrac option was an early example of this. While this has been moderately successful, especially in the case of Coursera, it alone is unlikely to sustain a venture capital based enterprise. A version of this business model arose when ACE and Coursera tried to provide ACE academic credit for selected Coursera courses for a fee much higher than the SigTrac option. There continues to be the notion that employers will pay for information about high performers on MOOCs. This was a mainstay of Udacity’s early business model which remained very low in the uptake. Most MOOC providers see their platforms as of high potential value to universities and others as a way to reach and serve students. An early example of this was the use of the Coursera platform by the University of Washington to host several UW MOOCs which were then used for UW enrolled students for a modest fee back to Coursera. The relative lack of sophistication of these platforms versus enterprise-wide LMS platforms probably limits this as an income producer. MOOC providers also see their services as an inventory for a marketplace of course content, seeking a share in the licensing of courses from one institution to another (or to many). While logical, this kind of model, tried many times, has not worked. The last business model emerging started primarily with Udacity whose founder Sebastian Thrun saw little potential in degree-based MOOCs. He turned to the corporate world concluding that corporations would respond to the very low price of high quality content for their training needs. Udacity formed an “alliance” which did not include any universities to exploit this market. The jury is out on this model but it does represent a serious threat to university CE organizations serving corporate clients.
MOOC providers are expanding their most successful revenue generator to date, which is charging fees for assessment and verification of learning. The Coursera case is most interesting in this regard. Coursera might stop providing verification for those students who just complete course assignments without going through the SigTrac option, thus driving students toward the fee-based option. They will also seek deeper evaluation/certification by engaging universities to create assessment experiences and charge an extra fee for these assessments. They are instituting the course sequence program which again deepens the amount and reasons for engagement of students, particularly where such assessments can gain acceptance by employers. Udacity is seeking to customize certification for large corporations, using a subscription basis for pricing the content. Another logical way for MOOC providers to make money is to gain value for the large number of students who are attracted to MOOCs. Until now they have stayed away for this most obvious strategy seeking to remain on high philosophical ground, but as the pressure to provide investors return, MOOC providers are beginning to explore this option, particularly, at first, as a value proposition to their university partners. Finally, as the uses of MOOCs expand, the technical platforms of MOOC providers are becoming more sophisticated. For instance, MOOC providers are, or shortly will, all have the ability to create courses that are “always available” (independent study model vs. cohort model), devoted to particular audiences (such as students in the course of a particular university), and learning communities of all kinds. In this they compete with the Blackboards and Moodle’s of the world in providing MOOCs for individual uses. Gaining even small fees per user could result in a robust income stream.
Universities have the chance now to use free MOOCs to demonstrate the value of the fee-based products they offer. The many thousands signing up for individual MOOCs are strong prospects for related courses and course sequences offered by the MOOC creator institution. Faced with a potentially declining flow of new courses, MOOC providers have sought to strengthen the value proposition to participating universities by offering them the chance to advertise or market related fee-based offerings. The main value proposition current MOOC providers have is their ability to reach large numbers of people, something they will have to exploit to stay in business. Expect to see some value flow basic to MOOC providers in referral fees. The expansion of learning assessment and certifications by universities presents another opportunity to turn MOOCs into money makers for universities. The new focus on corporations is both a threat and a possible opportunity for universities. The content for corporate training has to be created somewhere and universities are a logical supplier.
Massive Open Online Courses (MOOCs) 2.0: A Market in
Gary W. Matkin, University of California, Irvine
Dean, Continuing Education, Distance Learning and Summer Session
NACUBO Scaling New Heights Annual Meeting, July 17-19, 2014
UC Irvine’s Experience with MOOCs
15 MOOCs enrolling over 750,000
2 of first 5 ACE accredited Coursera courses
First course sequence on Coursera, Virtual
Teacher, enrolling 53,000, completing over 4,000
Waking Dead MOOC with AMC
UC Irvine’s Involvement in Open Education
Opened UCI OCW in November 2006
Currently offers 82 open courses, over 800 video lectures
Over 100,000 viewers on YouTube channel per month
Serves deserving audiences
Incorporates unique features
MOOCs (Coursera, Canvas)
Gary Matkin served as treasurer of the Open Education
Larry Cooperman serves as president of the OEC
The Supply of OER Is Huge And Growing
• 280 Members
• Over 30,000
• Over 700,000
videos on Education
• Over 500,000
M O O C S
Setting the Context for a MOOC Strategy
Involvement in MOOCs became a symbol of being “in the
Jump on the train
Initial hype, concern, vs. trough of disillusionment, but steady
proliferation of organizations and MOOCs
Inappropriate metrics, criticizing MOOCs for what they are
not or what they might be
Shift from degree courses to CE, shift from single course to
Large % of international and well educated students
Multiple levels of engagement in same course
Early MOOC Provider Business Models
Entrance Fees (EdX)
Fees for certification
Fees for academic credit
Fees for employee recruitment
Fees for platform use
Licensing fees for university content
Serving corporations in the CE market
1. Gain positive attention
2. Attract and serve students
3. Create a position for innovation readiness
4. Symbolize innovation
5. Provide opportunities for research on learning and
6. Fulfill public service roles
7. Can serve deserving audiences (alumni, lay public)
8. Inform course authorship and design
9. Put instruction on the "train"
Early Value Proposition to Universities
Emerging MOOC Provider Business Models
Expanded certification revenue
Added certification levels
Move from individual courses to course
Referral fees (marketing)
Platform enhancement strategies (hosting fees)
Emerging University MOOC Business Models
Marketing for fee based programs
MOOC provider/Corporate alliances
MOOC business models are changing rapidly both
for MOOC providers and universities
MOOC providers currently provide market
opportunities for universities willing to adjust
Open education is here to stay and will disrupt
All major universities will have to be both
creators and suppliers of open education
MOOCs and open education will disrupt
university continuing education the most