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Higher Ed E-Learning Growth To Continue at Modest Pace Through 2015

While electronic learning will continue to grow in higher education, that growth will be a bit slower than previously anticipated, according to a new report released this week. In fact, that slowing trend will be felt worldwide across nearly all segments--with a few notable exceptions.

Trends in Higher Ed
Worldwide, the growth of expenditures electronic learning technologies and services is beginning to shed momentum, according to the report, "The Worldwide Market for Self-paced eLearning Products and Services: 2010-2015 Forecast and Analysis," released Monday by market research firm Ambient Insight. In the United States, that growth is expected to be 5.9 percent annually through 2015. Higher ed--which is already one of the more mature segments and heavily invested in self-paced e-learning technologies--will outpace the national average slightly. Expenditures in higher ed hit roughly $4.4 billion in 2010 and will grow at a compound annual rate of 6.7 percent through 2015, when annual expenditures will reach $6.1 billion.

Ambient Insight defines self-paced e-learning products as packaged content, custom content development services, learning platform and tool hosting services, authoring software and tools, and installed learning platforms.

Explained Ambient Insight Chief Research Officer Sam Adkins: "Now we definitely see slowing down in higher education due to schools capping enrollments and outright reducing enrollment now due to either budget cuts (non-profits) or to the self-imposed restructuring done by the for-profits to blunt the edge of the new regulations. The most problematic is the rule that online (both for-profit and non-profit) schools must meet the requirements for any and all states where students enroll from. That will be expensive."

He also explained that for-profits are reducing higher-risk enrollments in anticipation of new regulations, impacting growth.

Meanwhile, the preK-12 segment, less heavily invested at present than higher ed, will see much more dramatic compound annual growth--16.8 percent through 2015, making it the most active e-learning segment in the United State, just ahead of healthcare (five-year CAGR of 16.3 percent) and associations (five-year CAGR of 14.3 percent). Spending on e-learning in preK-12 reached about $2.2 billion in 2010, according to Ambient Insight. That will hit roughly $4.9 billion in 2015, or 20.25 percent of the entire market for e-learning products and services in the United States.

Combined, U.S. preK-12 and higher education will make up 22 percent of worldwide expenditures across all sectors and 45.5 percent of overall U.S. e-learning expenditures by 2015.

Worldwide Outlook: United States Lags Behind All Other Regions
Spending in the United States on self-paced e-learning products and services hit $18.2 billion in 2010, about 57 percent of overall worldwide expenditures. But growth is slowingdomestically even as it accelerates rapidly in markets like India and China.

Through 2015, U.S. expenditures on e-learning will grow at a compound annual rate of just 5.9 percent, reaching $24.2 billion in 2015. The strongest segments for growth in the United States will be preK-12 education (16.8 percent), healthcare (16.3 percent), and associations (14.3 percent), according to information provided by Ambient Insight. Overall growth is being dragged down mainly by flat spending in the huge corporate market. Expenditures there were $6.8 billion in 2010, beating out both higher education and preK-12. But compound annual growth (CAGR) through 2015 will be just 0.9 percent, ending at $7.1 billion in 2015.

"The lingering effects of the global recession are acting as catalysts or as inhibitors in different buying segments depending on the adoption stage in any particular country," the report said. "In the more mature markets like the [United States] and the UK, the slow recovery is still inhibiting expenditures in the corporate segment. In contrast, the recession has been a catalyst for Self-paced eLearning in the academic segments in the [United States] and the UK."

Overall worldwide expenditures, meanwhile, hit $32.1 billion in 2010 and are now being forecast to reach $49.9 billion by 2015, a CAGR of 9.2 percent. (In the previous year's forecast, the five-year CAGR for worldwide e-learning expenditures was 12.8 percent through 2014.)

Adkins said the current forecast could well be revised downward when figures are calculated for the next forecast--due out in 2012--thanks in part to pricing pressures, though "explosive growth" in India and China could be a mitigating factor.

"Yes, on aggregate, the [worldwide] market is slowing, but only by a few percentage points. The global market is being dragged down by mature (slow growth) regions and countries and masks the vibrant growth in specific countries. All product markets mature, and, as adoption widens, prices go down. Growth rates are calculated based on revenues and the total revenues start dropping as suppliers compete on price."

Other e-learning forecast highlights from around the world included:

  • Double-digit growth is predicted for all regions except North America and Western Europe, with Asia (28 percent) and Eastern Europe (22 percent) leading;
  • India and China will both see growth north of 50 percent (about 57 percent and 52 percent, respectively), followed by Malaysia (about 41 percent), Romania (about 39 percent), and, rounding out the top 5, Poland (about 28 percent);
  • The remainder of the top 10--Czech Republic, Brazil, Indonesia, Colombia, and Ukraine--will each have a CAGR in e-learning expenditures between 20 percent and 30 percent, outpacing even the strongest individual segments in the United States;
  • Open source platforms are now "common around the planet," particularly Moodle;
  • The academic segment will be the largest e-learning buying segment by 2015 worldwide.

Adkins also explained that mobile learning technologies are "cannibalizing" sales of products categorized by Ambient Insight as self-paced e-learning products.( The firm's first mobile learning forecast is expected out in a few weeks.)

A free, 17-page executive overview of the findings from the latest self-paced e-learning forecast can be freely accessed in PDF form. The full report runs $4,825 for an organizational site license (unlimited users, multiple sites). Additional details can be found on Ambient Insight's e-learning research portal.

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