Massive Open Online Courses (MOOCs) made available by organizations like Coursera, an online education company that offers free college courses, are gaining popularity at lightning speed. An article in the New York Times details the growth and potential profitability of free online education companies.
In early 2012, Coursera was founded by two computer science professors, Daphne Koller and Andrew Ng, and enrollment has reached more than a million users for over 200 courses. This rapid growth outpaces the launches of both Twitter and Facebook.
The company is slowing starting to generate revenue. So far, Coursera has attracted $22 million in venture capital. Other companies offering online courses are also taking hold. Udemy allows individual professors to offer their courses online. Harvard and MIT have invested $30 million each to create edX, and Stanford’s Udacity, has accumulated $15 million in financing.
While none of these companies have a solid model for turning a profit, they are exploring various options. Coursera has started to financed its efforts through licensing, certification fees, and recruitment data provided to employers. Udacity charges corporate employers, including Facebook and Twitter, for access to high-performing students, starting with those studying software engineering.
For their part, Ms. Koller and Mr. Ng proclaim a desire to keep courses freely available to poor students worldwide. Education, they have said repeatedly, should be a right, not a privilege. And even their venture backers say profits can wait.
“Monetization is not the most important objective for this business at this point,” said Scott Sandell, a Coursera financier who is a general partner at New Enterprise Associates. “What is important is that Coursera is rapidly accumulating a body of high-quality content that could be very attractive to universities that want to license it for their own use. We invest with a very long mind-set, and the gestation period of the very best companies is at least 10 years.”
The CCC is active in discussing the future implications of MOOCs. In March, CCC will host a visioning workshop called “Multidisciplinary Research for Online Education,” where participants will explore and delineate computer science and multidisciplinary research agendas designed to improve formal and informal education.
Click here to read the full New York Times article.
