The Year of the MOOC - Part 2 of 2
In my previous blog, I spoke about how MOOC companies have made eLearning scalable using technology for content creation and delivery. In this blog, we will explore possible revenue models these companies can look at. Any successful company has three components to it: the market, the offerings, and the revenue model. Going by the number of people registering for such open courses, there is clearly a large market for this. Given that the courses are administered by faculty from top universities and combining this with scalable delivery model, the offerings piece is addressed. If MOOC companies can crack the revenue model, it is only a matter of time before they become profitable .
The education market in US is expected to be a trillion dollar industry. The market across the global is much more. How can MOOC companies grab a piece of this pie? According to the standard definition of MOOC, the participating individuals are neither required to be registered in a school nor pay a fee to access the course content. Hence the companies cannot charge a fee for administering the course. So the key to a successful revenue model in this industry is for companies to offer paid services around free course content. Following are some thoughts on how MOOCs can build a sustainable revenue model
1. Premium Memberships: The premium membership model has been tried, tested and perfected by companies such as linkedin. MOOC companies can adopt this model and convert a section of students and corporations into paying customers. Students with premium membership will have access to targeted job opportunities while employers will be able to view student profiles and recommend courses for securing interviews along with administering online tests and interviews. Students with premium memberships could also attend company sponsored weekend meetups and classroom sessions at local colleges.
2. Platform/Content Licensing: MOOC companies can license the platform/content to universities and businesses and provide a host of related services for a fee. Universities can primarily use this platform/content for hosting 101 level courses which can be completed by enrolled university students during breaks. This will allow the students to get started on higher level courses without wasting time on basics. This will also free up the faculty time to design and teach higher level courses and conduct academic research. Businesses can use this platform to customize and host their own training material along with using this to interview prospective employees. Businesses can also establish partnerships with universities through which professors can design and deliver tailored courses. MOOC companies can provide paid services such as training for corporate trainers along with a host of other services such as course content design, assessment and grading.
3. Personalized Curriculum Design: The current day online programs offered by some universities are highly structured and are administered at regular intervals. Compared to this, the courses offered by MOOCs are fairly arbitrary. MOOCs can allow individuals to design a personalized curriculum by mixing and matching courses from different universities and tie up with certifying vendors to offer proctored exams thus allowing individuals to earn course credits for a nominal fee. Such an offering will allow the individual to treat the MOOC as a regular college course with credits that can be used for employment opportunities.
The traditional college experience is about to change and MOOCs will be driving this change. As individuals attain the basic employable skills, they will prefer to join the workforce and start earning, simultaneously building their skills by enrolling in MOOCs rather than bear the opportunity cost of earning that comes with a full time classroom course. If MOOCs can successfully implement course credits, proctored exams, and offer basic employment services, individuals will be open to pay for the high quality content and services around it putting MOOCs in direct competition with universities. The future of MOOCs depend on how best and how early they can get individuals to start paying up for services around free courses.