E-learning may be changing how education reaches students, and how employees receive training, but it’s less clear that the much-hyped tool has lived up to its potential as a business opportunity. Supporters continue to extol e-learning’s benefits in the Internet age. Critics see it as a bud that has yet to flower, or could even spring weeds.
In 2004 University of Pennsylvania researchers Robert Zemsky and William F. Massy’s wide-ranging study on e-learning concluded that “e-learning took off before people really knew how to use it.” The problem? Too many ventures, too many untested products and a tendency on the part of vendors to overpromise and underdeliver — much like the dot com boom of which the movement was arguably a part.
But recent data suggest that the Canadian e-learning landscape is changing for the better, at least in higher education. And that means potential opportunity for business. The 2006 Technology and Student Access Survey, commissioned by education publisher McGraw-Hill Ryerson, found that hybrid learning — where faculty blend both traditional lectures and online features — has become standard practice on campuses. In 2003, 59% of faculty taught solely face to face. This year, that number has dropped to 31%, according to the national survey of Canadian universities.
For example, the University of Saskatchewan’s Web portal (PAWS or Personalized Access to Web Services) which posts and distributes course content has in the last year doubled its available number of courses, from 5,500 to 9,758. York University uses the similar and more widely used course management system WebCT, and last year nearly doubled its course offerings from 684 to 1,321. And in 2005, more than 161,000 students of varying ages registered for distance or online courses from 12 universities making up the consortium called the Canadian Virtual University. Since September 2001, the CVU has offered complete university degrees over the Internet or through distance education.
The most well-known of these universities — and the only one to offer courses solely online — is Alberta’s Athabasca University, which launched an online executive MBA in 1994.
“You can’t beat the competitive edge of anytime-anywhere studies, especially with rising transportation costs,” says Terry Anderson, the Canada Research Chair in Distance Education at Athabasca.
But with new technology comes overindulgence, says one professor. “Getting an MBA through videoconferencing sounds like selling a degree to me,” says Dr. Alan Hochstein, professor at Concordia University’s John Molson School of Business. He’s critical of Queen’s University’s executive MBA that allows students to spend part of their 15-month program taking videoconferencing courses. “The idea of e-learning through videoconferencing is good for people who don’t have access to face-to-face learning,” Hochstein points out, “but some schools just do it to attract students.” He favours in-classroom teaching because it’s important “to look into a student’s eyes to see if he understands what the professor is saying.”
Beyond the classroom, e-learning is helping push innovation in workplace training by providing staff and managers with technology that complements new â??social-networking’ trends. IDC Canada valued the Canadian e-learning corporate market in 2005 at $2 billion, up from $145 million in 2000.
Managers taking advantage of some e-learning programs are ecstatic about the results. Enterprise software for managers at IBM Canada is making learning “more collaborative, more personalized, and more integrated at work,” says Lee Wasson, manager of the IBM Center for Advanced Learning Technology. One of its more sophisticated systems, the Learning@IBM portal, receives 120,000 visits monthly. Introduced in 2004, the portal was born out of IBM’s need to save time training employees. IBM says it has also sold Learning portal-related management development software to enterprise companies like General Electric.
Rob Pearson, chief learning officer of Toronto-based e-learning provider VitesseLearning, says his clients prefer to move training away from event-based forms to an environment where employees learn on their own. “Typically, the ROI can manifest by saving the organizations money in training, since they don’t have to fly in learners or instructors.” He also cites a more “exciting” way to benefit from e-learning — staff is better trained by accessing just-in-time information and honing the ability to more readily satisfy customers on an online interface.
However, the verdict remains mixed. In the U.S. there are powerhouses like Blackboard whose revenues approach US$200 million annually. The landscape is considerably more modest in Canada but has nonetheless presented opportunities for some. For example, the e-learning market has propelled Peterborough, Ont.-based Operitel to profitability with 2005 revenues reaching $2.7 million, up from $1 million in 2004. Profit margins since 2004 are a robust 24%. “We are where we thought we would be,” says CEO Mike Skinner. “We credit that to coupling learning and technology, as opposed to building a better widget.”
But other suppliers are not so optimistic. “Revenues are a fraction of what we expected,” says Ted Moorhouse, president and CEO of Vancouver-based Serebra. “The plan of the e-learning model was solid, but classroom instruction has won out in North America.” He says only a few clients were interested in â??blended learning,’ where online and classroom instruction combine to create a hybrid experience.
Moorhouse prefers to look outside North America for clients. Close to 90% of Serebra’s revenues come from overseas customers, especially those in developing countries. “Some countries might not have high-quality instructors, but they have an incredible thirst for education,” he says, citing Dubai, Egypt and Jordan as countries where Serebra’s learning management system is used.
Overseas sales join another popular trend in the Canadian e-learning market: consolidation. Many e-learning companies got out of the business when the market wasn’t there, says Randy Labonte, director of sales for Odyssey Learning Systems of Vancouver. “But others decided to work with more of a consortium approach by building strategic partnerships with other vendors in the industry.” In Odyssey’s case the company leads the project management and marketing areas, while partners provide the actual courseware.
But ultimately, the relatively limited amount of profitable opportunities can’t satisfy the over 300 e-learning companies in Canada. Says Labonte, “It’s basically dogs fighting over scraps.”