With universities closed and students feeling mutinous at the idea of paying full fare for online lectures, e-learning is benefiting from an unexpected upgrade. US edtech start-ups raised a record $1.7bn last year. This year they may exceed that figure.
Glitzy San Francisco edtech start-up MasterClass has already capitalised on lockdown-induced boredom to raise $100m. A hybrid of Ted Talks and the Open University, MasterClass offers glossily produced pre-recorded videos from well known faces like RuPaul Charles, Anna Wintour and former International Space Station commander Chris Hadfield for an $180 annual subscription. Lessons are less instruction, more inspiration. But the start-up’s advertising blitz may benefit the educational side of the sector.
With enrolments in residential classes stalling, online courses were already rising before the pandemic. One third of US undergraduates take at least one online class, according to the National Center for Education Statistics. The fastest-growing group in higher education are adult learners — many of whom need a more flexible arrangement than a four-year residential degree. Around 15 per cent of students study entirely online. But edtech has yet to unseat the $600bn US higher education industry.
The growing cost of residential higher education should make online alternatives an easy sell. Fees plus living costs mean US students pay on average $30,500 each year. Those in private institutions pay around $50,000.
Massive open online courses, or Moocs, have been hyped as the future of education for almost a decade. Fees vary, with sign-ups often free while assignments and certificates carry charges. On average, undergraduate credits cost just under $600. Coursera offers a bachelors degree from a US university for $330 per credit hour. A similar plan from eDX costs less than $200. Outlier, created by Masterclass co-founder Aaron Rasmussen, charges $400.
Yet Mooc providers like Coursera have never managed to compete with the prestige, motivation and networking opportunities a US college provides. The product is simply too boring. Analysis on courses taught on edX by MIT and Harvard found only 3 per cent of participants completed their courses in 2017/18. To do better, they should consider taking a leaf from MasterClass. Lessons from celebrities may lack rigour. But at least they are fun to watch.
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