Millions of people are taking massive open online course (MOOC) offered by the world’s leading schools through the platforms of Coursera, Udacity and other growing MOOC providers, but revenue generation is a serious challenge for all providers. Following Udacity, Coursera is planning to target the corporate education market to drum up sustainable dollars.
Coursera has yet to formally launch a competing corporate training program, but co-founder Andrew Ng said that the company has been working with partners including Yahoo Inc. to define a strategy in the field, writes Lauren Hepler of Silicon Valley Business Journal.
Ng does not agree with Stanford professor and education entrepreneur Sebastian Thrun that MOOCs are a “lousy product.” Thrun, the founder and CEO of Silicon Valley education startup Udacity, recently said “we do not educate people as others wished, or as I wished.” Thrun cited low course completion rates and poor grades in a San Jose State University pilot as evidence that MOOCs do not work for everyone.
Udacity launched a program, called the Open Education Alliance, for corporate training. The company is now getting paid by companies like Google Inc. and Intuit Inc. to help produce courses for employee training and recruiting. Coursera is still working to develop program.
“We think that many companies view Coursera as a quality, convenient, inexpensive way to continue employee development,” according to Ng. “Is there a contract with a company that might make sense? I don’t have an answer to that yet.”
Under the agreement with Yahoo, Coursera paid for employees to take MOOCs on Coursera’s Signature track which, for a fee under $50, includes student identity verification services. Ng said the company is also exploring the possibility of selling dashboards or analytics tools to companies looking to track employee progress in online training courses.
Ng declined to say how much those services might cost if implemented. Coursera currently offers free classes but charges for premium services like the Signature Track, which the company announced in September has generated more than $1 million in revenue from 25,000 customers.
According to Ng, the move into business-to-business employment development services makes sense for low-cost MOOC providers, given the current employment market. Corporate training is a gigantic market. Human resources research firm Bersin by Deloitte estimates that companies spend anywhere from $200-$3,000 per employee, per year on training, depending on the line of business. The global market for employee training is valued at $135 billion, with $62 billion in the United States alone.
A stumbling block for MOOC legitimacy has been the lack of certification and confidence in MOOC credentials. LinkedIn recently announced that it teamed up with seven online education providers to allow to users to add certification and courses to their profiles. The new partnership allows LinkedIn users to include educational accomplishments that go beyond the traditional institutions. In partnerships with Coursera, edX, Lynda.com, Pearson, Skillsoft, Udacity, and Udemy, LinkedIn has launched a new pilot program called Direct-to-Profile Certifications that will show off online study achievements.
Coursera currently has partnerships with more than 100 academic institutions from all over the world. The online education provider now offers 500 courses and boasts five million students. It recently formed partnerships with 13 new institutions representing 11 countries, bringing its total number of partners to 107.