No More MOOCs: Edtech After 2013
This post was written for a class assignment for an education entrepreneurship class at Harvard Business School.
It is unfortunate that since the Year of the MOOCs ended, the education technology (edtech) space has stopped receiving the attention it deserves. Many people tuned out, thinking edtech already had its moment. However, the edtech space is actually just finding its feet and maturing as an industry into something meaningful and sustainable.
After our class discussion with Michael Horn, I talked to many people who still referred to Coursera and Udacity as “traditional MOOC providers.” This is a big misconception. Udacity has pivoted 4 times since it offered MOOCs and just achieved a billion dollar valuation on a very different product strategy. Similarly, Coursera is experimenting with product offerings and hired a new management team to try to increase revenue. Employees of both companies cringe whenever someone calls either company a MOOC provider.
Background
As we learned in the Coursera case study, both Udacity and Coursera were created by Stanford professors in an attempt to make course content accessible to everyone. They were actual massive open online courses — all students had the same experience and could view the content at any time for free.
Present-Day Udacity
After a series of pivots, Udacity created a new credential called the Nanodegree. Nanodegrees are built in collaboration with industry partners and consist of a series of courses designed to prepare students for specific careers. Each course has a project component so by the end of a Nanodegree, students have an entire portfolio they can show employers.
Udacity currently only focuses on tech careers. It’s most popular offering is the Android Developer Nanodegree (built in collaboration with Google). Working with companies gives Udacity more credibility — who would be a better content developer for Android courses than Google itself? — and provides a hiring partner for graduates.
It’s not a MOOC because:
Not Massive — Nanodegree cohorts have less than 100 students each, creating a close online community. Coaches provide personalized content support for students, grade their project submissions (usually in less than two hours), and coach them for job interviews.
Not Open — Each Nanodegree costs $200/month. Their new Nanodegree Plus initiative costs $299/month and guarantees a tech job or apprenticeship upon graduation. This is fairly expensive but Udacity is positioning itself as a premium brand.
When the company first started charging for course certificates, there was an outrage from students and supporters of free online education who said Udacity had become a “MOOCkery.” Over the past year, students have become more accepting of the price, especially after seeing graduates of Nanodegree programs get placed in new tech jobs.
I think Udacity will continue expanding its catalog to offer courses outside the tech industry and help bridge the job-skills gap in every country. It is now facing competition from upcoming startups such as Proversity and UpGrad and it will be interesting to see how they build out the space.
Present-Day Coursera
Coursera tried a few monetization strategies, primarily charging for “signature track” (priced between $50-$70 per course). This wasn’t very successful because employers and institutions were somewhat hesitant to accept these certificates. Since course assessments weren’t thoroughly proctored and content quality was often dubious, employers were not certain whether graduates had actually mastered relevant skills. I imagine it felt similar to having a certificate for completing a book.
Since then, Coursera has introduced Specializations, its own credential. Specializations consist of a series of courses from university + a capstone project created with industry.
Coursera has over 40 Specializations — ranging from Business English Communication skills to Big Data—which cost between $300 and $600. While it is probably easier to convince students to purchase this credential, Coursera still has to strengthen the initiative. In the Business Foundations specialization, for example, Wharton professors teach corporate finance and then ask students to build a pitch deck for a startup. The inconsistency made me worry that a lot of Coursera’s content may not be relevant if they try to get into the job-readiness space.
While the content is accessible for free, Specializations, like Nanodegrees, are closed and designed to provide a more personalized student experience than MOOCs did.
Conclusion
Since both Udacity and Coursera have to earn significant revenue to justify their massive rounds of funding, they are working hard to build profitable online education models. While they still care about social impact, their main goal is to build online credentials that others recognize and are willing to pay for.
