A New Age of LMS Analytics: Industry Growth and Recession Resistance

Yesterday, we highlighted a section of the A New Age of Learning Management Analytics whitepaper which provided a great snapshot of the current state of the learning management system (LMS) in a turbulent education landscape.

Today, we wanted to highlight the white paper's second section, entitled, "Industry Growth & Recession Resistance," which provides a wealth of insight and statistics pertaining to the ongoing evolution and widespread adoption and delivery of online education.

If you have any comments or would like to share insight on the current state of LMS, please share it in the comments below or feel free to contact us directly at feedback@moodlerooms.com

Industry growth & Recession Resistance

• Despite the recession creating economic challenges in the education sector, the demand is positive in all online learning buyer segments in consumer, corporate, federal, state and local government, pre-K-20 academic, non-profits and associations, and health care. The increasing demand for knowledge presents distinct revenue opportunities in virtually all buyer segments. Additionally, the rate of growth in the academic segments is due in part to the success and proliferation of the for-profit online schools, a $20 billion industry relatively new to online learning.

• The untapped potential of online learning has transformational potential to deconstruct and reinvent educational practices and change the financial business model for higher education and other adjacent sectors. This transformational potential will define the next decade of online learning, providing new opportunities for institutions that can position themselves at the “thin tip of the wedge” in this early phase of market category redefinition. Research has shown that online learning has progressively come to be regarded as equivalent or even superior in some ways to traditional, face-to-face learning — especially among 18-24 year old and working adult learners and by faculty who were early adopters. The LMS market, with more than 10 years of usage across campuses nationwide, has reached levels of depth and penetration where the first generation of e-learning is deeply inculcated into the culture of higher education.

• The continued growth of online education is stimulated by the continuing pressure for education institutions to achieve financial sustainability. The model for funding public institutions is antiquated and broken, contributing to the diminishing confidence and public support for the education system over the past decades. Online learning is now uniquely positioned to be a potential game changer in educational business models in ways that can impact the marginal cost of instruction, which may be reduced to less than the price of tuition, allowing growth to meet demand — even during recession. Market leaders have already achieved this goal. Post-recession, the rest of American higher education needs to adopt and scale these practices. Consider the following statistics in online education sector growth:

• The U.S. e-learning market reached $17.5 billion in 2007 and the global e-learning market will surpass $52.6 billion by 2010. (GMI, Global Industry Analysts, Inc)

• Online practices have transformational potential to deconstruct and reinvent educational practices and change the financial business model for higher education.

• The academic computing market is destined for accelerated expansion driven by the evolution of the LMS segment and the mounting external pressures for institutional accountability.

• Building on an increasing accountability drumbeat by regulators, accreditation agencies and tuition-weary parents, institutions are in need of tools to manage and provide proof of their learning and performance outcomes. As such, LMS systems are beginning to provide other value to the institution beyond their original purposes.

• Significant drops in state and endowment funding to higher education, competition from global and for-profit markets, and the continued demographic changes in the student population are all contributing force fields causing colleges and universities to contemplate new performance management strategies on how to analyze and report information to federal and state institutions, policy makers and the general public.

• The learning outcomes management (LOM) segment, which is comprised of products thats upport development, delivery, reporting and management of assessment-related activities, has emerged as a new source of opportunity for both LMS providers and niche suppliers. LOM stands to benefit from the increasing pressures that colleges and universities face regarding student performance and institutional accountability.