What is the way forward for Coursera?
Massive Open Online Courses (MOOCs) have revolutionized the delivery of higher education courses around the world. A leading provider of MOOCs is Coursera, which was launched in 2011, and today has 147 partners across 29 countries offering 1,888 courses in a variety of languages. Coursera’s operating model would not have been possible without digital technology as it is leveraging the spread of high speed internet and an interactive online education platform to make the most popular courses from experts in all fields available to everyone around the world at little to no cost. This model is a win-win situation since experts get to reach a much wider audience of students, in some cases they can reach the number of students it would have taken 250 years to reach in a single year, and it helps smaller institutions from having to hire experts in every field and faculty can remain focused on maximizing the classroom experience. As a result, many blended learning models have emerged which include synchronizing an entire MOOC with an in-class course or using select components of a MOOC in a course and supplementing it with additional reading materials. Research has shown that the outcomes of these blended learning courses are almost equal, if not better than, similar in-person courses.
In terms of the business model, Coursera initially had no revenue streams as it didn’t charge for courses but over time, Coursera has begun to capture value by charging students to receive verified certificates which are advertised as a trusted way to showcase your skills to employers. Courses have also been grouped into Specializations with a capstone project to allow the student to demonstrate their learning from the courses. Individual anecdotes exist where students were able to use Coursera courses or specializations to get new jobs such as when a young man in Africa with a humanities background was able to get a job at PricewaterhouseCoopers after taking accounting courses on Coursera. But Coursera still hasn’t been able to achieve these outcomes at scale and until they can convey the value of a verified certificate, it will be difficult for them to convert many users. If Coursera wants to have a tangible impact on unemployment, they should partner with employers to hire their students similar to the coding academies such as Hack Reactor which advertises over 300 hiring partners and a 98% graduate hiring rate from their San Francisco campus.
And while Coursera wouldn’t have been possible without recent advances in digital technology, technology is also undermining the strength of the experience. A recent study by Harvard and MIT on cheating in MOOCs identified up to 5 percent of certificates in some courses may be due to a practice known as “copying answers using multiple existences online” (CAMEO). Students will create multiple free accounts to identify the solutions to quizzes on one account and then input all the correct answers in the main account. Potential solutions include not sharing solutions until after the due date of each assignment or randomizing questions on quizzes so that no two quizzes are alike. Another potential solution is for Coursera to use the technology used by the researchers to identify when the same user creates two separate accounts and they could warn the user they will disable the old account.
The other potential revenue stream for Coursera is to charge users for courses if they can be counted towards college credit and while a few courses have been approved for credit, colleges must decide if they will accept the credit and thus far, very few have. A more promising revenue stream is the licensing of course content to smaller universities and colleges as they realize the cost savings of not hiring experts in each field. Coursera struck a deal with Antioch University a few years ago but this channel should be explored more aggressively.
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Student comments on What is the way forward for Coursera?
Thanks for posting. I see a couple of issues with online education platforms that might keep them from gaining traction in the long run. Admittedly some ‘me-search’, I find it much more difficult to fully engage and stay interested in an online course, particularly when it’s not required as a part of an educational goal I’m trying to achieve. In light of this, and you mention it in your post, I think it’s critical for Coursera to focus on courses that can somehow be recognized by universities or employers as an added value or a requirement. Secondly, I struggle with the idea that MOOCs and online coursework will be widely adapted by consumers, seeing as the cultural norm of relying on branded university degrees is so ingrained in the way people are hired and promoted. If online courses only then serve the demand for personal growth and the joy of lifelong learning, will people invest in a venture with an unquantifiable return?
Thanks for the article! I am a user of Coursera and completed two courses before. I really like the idea of MOOC since it makes learning more accessible and spontaneous. I enjoy my experience with Coursera but I think there are still several challenges for Coursera and other online education platforms. First, MOOCs are using freemium to increase its customer base, but how could this venture-fund company make profits? Although they charge fees if customers want to get verified certification, few people pay for it given the recognition towards such certification from employers is still low. Second, I think Coursera could better improve the interaction and course design, as many people registered lots of courses but few can really complete. I think it is because the courses don’t have hard deadlines and are free to access, so people put it as a less priority and procrastinate; some courses are just boring lecture recordings and don’t have interactive designs and thus reduce people’s interest to learn.
Thanks for the interesting post Rajit. As I was reading I started to think about this monetization issue and it reminded me of our marketing case on Rdio. We’ve seen that using the freemium model can be very difficult to provide sufficient value so as to acquire users whilst at the same time encouraging them to upgrade to the paid functions. Do you think that the certificate is enough of an incentive to get a satisfactory amount of paid users? In addition, because this payment is a one-off for a particular course rather than a recurring payment, it could be that the cost of user acquisition is greater than the revenue that comes from one course – in this case coursera may need to sell 2 or 3 certificates before they break even. This leads me to thinking about other monetization methods – could coursera partner with companies that provide offline educational content? Could they advertise a service that is in the education space but will not compete with their offering? Finally, is there a particularly interesting opportunity for Coursera in focusing on geographies where educational content can be difficult to reach? For example, in some emerging markets Coursera could be by far the cheapest and most accessible option to learn a new language or a particular subject.
Rajit, thanks for the great post! I think Coursera is such an interesting organization – and was really the driving factor in the digitization of higher ed education. I think Ting mentioned an important point, which is that Coursera is really struggling with customer retention. A very low percentage of their students who start a course finish the course and come back week after week. Coursera has yet to identify what the important levers are for students to get to finish a course. I also think they face challenges from LinkedIn with Lynda and Udacity who are focused on “nanodegrees” sponsored by hiring organizations and certifying certain skills with smaller commitment classes – less like university courses on Coursera. I am curious to see how Coursera will update their business model as the MOOC industry landscape changes.
The biggest question the jury is still out as far as the data goes is are you really as qualified, having taken an online course, as someone is from a brick-and-mortar experience? For subjects such as marketing and leadership we may never know but I’ll tell you right now if my Dr. told me he got his MD from University of Phoenix online I’d be looking for a new one real quick. As long as that is true, the only degree anyone will ever receive online is a certification or pat-on-the-back for sticking through to the end. I think where we start to enter some really interesting territory is VR, AR, or anywhere someone can get their hands onto something and really screw up and learn the consequences. TOM simulations could probably be done pretty well online given our beer game, and for most positions, do we really need anyone with a lot more experience than an online simulation might offer? My fear overall is online learning will marginalize our work force towards the highly specialized brick and mortars, and the woefully under-qualified automated learning experiences.
I’m a big fan of Coursera and other MOOC providers. While I was at AWS we were constantly working closely with Coursera and some of the other providers like HBX to drive their storage and distribution costs down for their IT infrastructure backbone. The goal of this was to help them better focus their time and funding on the courses and other programs they were offering. I used to use some of the early versions of these back in the day with MITX and some other offerings that Stanford used to provide. Generally I aimed for the free content and structure that the course syllabuses would provide, and then would augment these studies with additional research online. Their transition to a paid model in return for certifications is an interesting and positive move as it provides a return on the investment (time and money) for following through with the course, while at the same time providing tangible legitimacy to the program. I like the idea that you note of partnering with more universities, like they did with Antioch and see this as a great avenue for them to really invest into. The wider the depth and breadth of the services that they can provide, the better. Furthermore, more legitimate and deeper certifications and possibly degrees they can provide might also be helpful for drawing in other users.
Interesting post Rajit. I really liked the idea you touched on about using MOOCs to help with unemployment. Currently there is huge misalignment between the skills employers are looking for and skills the unemployed possess. Aligning with employers to produce job training content could be a potential next step for Coursera. Additionally, they could offer certificates that employers agree to recognize. Traditional higher education is very expensive and not for everyone. Finding alternatives that can train people in a most cost effective way would result in increased productivity and decreased unemployment.
Thanks for this fascinating post. The ability of MOOCS to increase access to truly world class education is an exciting frontier. I think the biggest question is how different is a MOOC from a digital textbook? Are these classes really just digitally enhanced textbooks or is there enough interaction between students and teachers to make it an enriching classroom experience?
Great post !! I have been a user of the platform myself and I can definitely see how they are pushing frontiers in the education industry. I do not think, however, that they have taken the best approach to digital learning as there is, as mentioned in an earlier comment, that the interaction between students and professors may be challenging. If our HBS professor Clayton Christensen in right, and we are at the verge of innovation disruption in higher education, would you say they are leading the way in how the future of learning is going to look like? are they really doing a better job at educating just by posting their courses and having interactive testing online?
I will admit, I’ve tried a couple of Coursera classes and didn’t stick with it. Some of the commenters above had good hypotheses as to why this has been the case. For me, personally, I feel that if I didn’t pay a large sum of money in it, I might let it just “slip.” One of the things I love about being at HBS is the mandatory attendance. It forces you to really commit to the reading, conversation, and, thus, the learning. I have a hard time believing that the current model of Coursera will be successful because ultimately it requires a student’s commitment to have that student reap the benefits of Coursera… and if a business can’t deliver its value proposition to a student (no matter whose fault it is), then that business will ultimately fail.
I like the idea of having Coursera classes count toward a degree, but I’m not sure that’s a full fix. After all, my understanding is that many people take Coursera courses because they aren’t currently working toward a degree!
Gamification has been a popular topic among many kinds of online services, and I think perhaps Coursera should be focusing its efforts on using gamification as a way to get their students to more strongly commit.
Very interesting post. If MOOCs become recognized by employers someday, I think MOOCs will create additional threats to many educational institutions that are not well known, because their courses will become commodities and could be switched with Coursera courses (or any other MOOC). Thus, what are the benefits of attending a not well-known university/institution if the courses are the same? Are we creating a system in which attending university is only a signal to the market about our capacity to get into an Ivy League instead of the actual knowledge that we will acquire?