“Universities won't survive. The future is outside the traditional campus, outside the traditional classroom. Distance learning is coming on fast.”
E-learning is today’s digital trend to use electronic educational technology for learning and teaching purposes. Online learning is a contemporary way to obtain new skills, improve the existing ones and keep them up to date. Educational platforms and websites as well as applications are continuously replacing the hunting for free classes and tutorials on YouTube. However, the starting budget and a good idea of an educational e-learning application are not enough to begin. There are some trends and tendencies on the worldwide digital learning market that should be taken into account to avoid business pitfalls.
Fast-paced nature of today’s reality determines our lives. Money is never enough, calendars and organizers are overly booked, so the question is: when to learn, how to find time on self-education? The gist of self-paced E-learning is to give users possibility to learn in a convenient way: wherever they want, whenever they can and at their own pace.
Digital learning classes can be different:
- Video demonstrations
- Software interactions
The growth of Global E-learning market
The perspectives of worldwide E-learning market growth are indisputable. Influenced by outspread of smart connected devices and the Internet access they give, E-learning market is said to significantly develop during the next few years. The five-year compound annual growth rate according to the Ambient Inside survey is going to be 7.6% so the predicted revenues should be about $51.5 billion by 2016.
“Mobile phones are misnamed. They should be called ‘gateways to all human knowledge”.
It is hard to imagine a day without any mobile device. Tablets and smartphones have become an essential part of modern life. Mobile learning is among other possibilities they give. The development of E-learning industry is unthinkable without cocurrent growth of mobile market and extensive use of mobile devices. Research data gives optimistic forecast for the perspectives of mobile learning development.
According to IDC forecast, tablets and smartphones will expel the PC from the device market. The tablets will increase to 16.5% by 2017 compared to 11.8% in 2013. Smartphones will jump from 59.5% up to 70.5%, and PCs will fall from 11.8% to 16.5%. As we can see, the rise of mobile is one of the crucial trends defining the device market.
BYOD (Bring Your Own Device)
This is a natural consequence of mobile devices expansion. People take their own devices to work, for professional, educational or private purposes. The leaders are smartphones, but the number of tablets employees take to workplace also increases.
Taking into account the overall speed of life and the development of IT business sector, companies should permanently train their employees to keep up with the pace of others and stay competitive. Both group and individual training programs should be appropriately organized and monitored via tracking system able to store and analyze educational data on each participant. Learning management systems have now become one of the most important elements of company’s human resources tools for workforce advancement.
The data on Global Education Expenditure Breakdown in 2012 shows that corporate-training sector lagged behind the others. Though it doesn’t seem very optimistic, there is a budding tendency that despite budget constraints, companies all over the world understand the necessity of embedding the E-learning into their human resources development strategy.
Cloud changes everything
Software-as-a-Service (SaaS) operational model of cloud technology begins to take key position in the the Enterprises CRM (Customer Relationship Management) systems, and to gradually replace older systems. Many analytics predict serious growth of SaaS in 2015 and agree on three common advantages it brings.
Along with large companies and corporations, small and medium enterprises tend to move towards SaaS Learning Management System (LMS).
Source: Information Week Analytics SaaS Survey
Learning Management System
Learning Management System is a complex specialized database management software. It is made for managing students profiles, educational material and tools for results’ evaluation. LMS industry products are functional and easy-to-use software for electronic education. It is a “must have” option for companies looking to permanently train their staff. And not to forget the educational potential of LMS.
LMS is predicted to become one of the headliners of E-learning in 2015. Awaited annual growth is 25% and it is expected to reach $7.8 billion by 2018. The progress of LMS is also driven by the use of Cloud technology. It allows functioning without any software installation, so there is no need in supporting server. Interactive learning process of modern E-learning turns into a lifestyle that changes not only lives of adults but also children and teenagers.
One of the most popular and massive LMS is MOODLE: an open source learning platform for educators. Because it is open source it is permanently upgraded.
Post-secondary and K-12 (kindergarten through 12th grade) sectors are very attractive for business due to their perspectives. Large base of users is the most promising feature in general educational sector.
K-12 kids involved in e-learning process could make a really huge audience of accustomed users for the post-secondary stage.
If we just take into account E-learning and ignore the direct educational field, the K-12 sector will represent the biggest part of the market.
This is confirmed by GSV Advisors data on Compound Annual Growth Rate (CAGR) of E-learning sector.
One of the leading K-12 Learning Management System is Edutopia founded by famous filmmaker George Lucas. Another good example will be Notesmaster: free E-learning platform, designed to make Global Educational Network accessible for secondary level students. It gives awesome possibility for teachers and students from different countries to share educational materials and gain knowledge.
Besides, TechCrunch shows that youth tend to spend more time on mobile apps than browsing web, and the most used mobile device in this sector is tablet. This information could be vital for all market players, pushing them to find new ways of engaging young users and making new offerings. It should also be mentioned that evolution of education technology in the direction of its digitization inaugurates the move from printed textbooks to electronic books. This change promises new business niche for creating e-books and for the development of e-book hosting environment.
Short geographical review on E-learning industry perspectives
There are some peculiarities driving market in each geographical region, which should be considered by E-learning solutions providers.
The North American region
This is the most promising and highly developed market for E-learning. Despite its lowest growth rate compared to other regions, it has the highest revenues.
- 4.4% Annual growth rate
- $27.1B revenues by 2016
The Western Europe region
Western Europe is the second largest region of E-learning market. Some forecasts predict that it will be displaced by Asian sector by 2016.
- 5.8% Annual growth rate
- $8.1B revenues by 2016
The Asian region
Asian E-learning sectors expands extremely fast, seeming to double its 2011 revenues by 2016. One of its main drivers is the governmental programs targeted towards literacy development in rural regions.
- 17.3% Annual growth rate
- $11.5B revenues by 2016
The Eastern European region
It tooks second place in growth rate after Asia. The market progress is driven by governmental investments together with with numerous startups focused on educational purposes.
- 16.9% Annual growth rate
- $1.2B revenues by 2016
The Latin American region
Latin American sector is now moving from “consuming” of E-learning content towards the rise of its own market operated by domestic companies.
- 14.6% Annual growth rate
- $2.2B revenues by 2016
The Middle Eastern region
Another rapidly growing sector, driven not only by government but also by corporations and even private schools.
- 8.2% Annual growth rate
- $560.7M revenues by 2016
Venture Capital in E-learning Industry
During the last five years E-learning industry was driven by the next players:
- Educational entrepreneur startups
- Large corporations
- Spin-off ventures
The total inflow of venture capital made $6 billion. Since 2012, according to Ambient Insight data, two common directions of investment in E-Learning sector have appeared:
- K-12 and pre-K-12 educational startups
- Corporate-oriented projects
They seem to be attractive investment targets, and along with LMS Market strive to grow on and on.
All-round popularisation and adoption of mobile devices with ever growing possibilities they give, shows great perspective for E-learning software developers and investors. Overall trend of learning everywhere along with the growing need in training the employees is the background that will keep this tendency top of mind for the nearest future.
Mutual influence of the mobile growth and the expansion of the Internet of Things changes the public attitude towards E-learning. It appears not only to be just another sector of digital market, but an efficient way to give relevant knowledge to workforce of enterprises and raise the educational level of all social stratums in various countries.
We hope this material gives you necessary information and insights to start a new or improve your existing business. In case you just get interested in E-learning services or have some ideas that you want to implement - feel free to contact us with any questions.
Graphics and information was taken from: Docebo E-Learning Market Trends & Forecasts 2014-2016 Report from docebo.com