MOOCs, or massive online open courses, have caused quite a stir. Supporters including Thomas Friedman of the New York Times proclaim that they will usher in an era of unprecedented opportunity for those currently locked out of existing educational options, thus democratizing knowledge. Others say MOOCs could end universities’ monopoly on knowledge dissemination, forever changing the nature of brick and mortar institutions.   Still others claim that MOOC-like courses will favor a few well-known educators and lock others out of the system entirely.

None of these views seem to reflect what is actually going on as more MOOCs are rolled out. Enrollments and completion levels have not met expectations, and even courses launched with enormous fanfare, such as the partnership between San Jose State and Udacity, have been declared failures relative to their expectations.

This should not surprise those of us working in entrepreneurship and innovation. New categories are routinely launched with many untested assumptions, and it is only through the sometimes painful process of experimentation and learning that these assumptions evolve into knowledge. Indeed, successful entrepreneurs, such as the well-known father of the "lean" startup movement Steve Blank, are huge advocates of keeping investment contained, moving forward with a minimum viable product, and using prototypes to learn about the market. Unfortunately, most new categories are accompanied by incredible hype, leading investors to sink tons of resources into more ventures than will succeed in the hope of striking it rich.

As Clayton Christensen pointed out at last year's Thinkers50 conference in London, research in new market entry by entrepreneurs often follows the pattern playing out in online education right now, namely, "Capital Market Myopia," which refers to people's inability to judge the collective consequences of individual decisions, in this case massive investment in a new business category.

So what are we to make of MOOC's? Firstly, they suffer from a problem that many cool technologies face when they are first introduced: the lack of a complete business model coupled with major assumptions about demand. No one, even those who founded the major MOOCs, quite knows yet how they are going to make money. Giving away your core product and hoping to make up the difference using other revenue streams is risky--just ask the newspaper business.

Further, the exact problem that MOOCs are designed to address remains unclear. They call to mind the earliest movies; in possession of new technology, no one was quite sure what to do with it, so they filmed theatrical productions! Only with time did it become clear that "moving pictures" could do things that stage productions could not, at which point the medium came into its own. MOOCs are very similar, filming professors talking in classrooms, essentially tying the technology to a pedagogical approach that harks back to the age of Socrates!

That said, some entrepreneurs are using online and digital media to do things differently. Salman Khan’s Khan Academy is one bright light, featuring short illustrated lectures that in some cases result in "flipped" classes where students learn the content on their own and teachers help in the application. The Khan academy, however, is nonprofit, supported by (among others) the Bill and Melinda Gates Foundation.

Another potentially attractive model is being explored by new companies in the educational technology field. One is being developed by a firm called Syllutions (full disclosure: I have done some filming for them), which has identified a real customer pain point: the opportunity gap between the top 200-300 executives who might go off to a school like Columbia and the 3,000-4,000 who need to get the same content but for whom it is too expensive or time-consuming. Syllutions has taken the content taught for senior executives and coupled it with new technologies to create immersive education that engages many kinds of learners, promotes the conduct of real work, and measures the rate at which new understanding moves through a company. In short, these productions are more like real movies rather than filmed plays. Stay tuned for the post-MOOC digital education model.


Published on: Feb 26, 2014
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