For the latest post in our series on OER business models, we focus on ways in which we can focus on concrete examples of innovation using open educational resources. Burd et al. (2015) highlight several business opportunities for open education described by Moodys:
- New revenue opportunities through fees for certificates, courses, degrees, licensing, or advertisement
- Improved operating efficiencies due to the lower cost of course delivery on a per student basis. & Heightened global brand recognition and the removal of geographic campus-based barriers to attracting students and faculty.
- An enhanced and protected core residential campus experience for students at traditional not-for-profit and public universities.
- The longer-term potential to create new networks of much greater scale across the sector, allowing more colleges and universities to specialise while also reducing operating costs.
- New competitive pressure on for-profit and some not-for-profit institutions that fail to align with emerging high-reputation networks or find a viable, independent niche.
The following models have been suggested specifically for strategies that use open approaches.
Dual Mode Universities
Dual-mode universities (Ubachs & Konings, 2016:350-1) offer both traditional and distance education, typically with the same admission requirements and study materials. There is an overlap in this area with open and distance learning. Some HEIs have taken advantage of the MOOC offer to develop a distance learning or virtual university operation. “Open universities” were well established in Europe, and the transition from distance learning to eLearning required significant institutional change (Van Dijck & Poell, 2015). Furthermore, universities are typically understood as a public good in Europe in contrast to the fee-based model more common in the USA and widely used to finance MOOCs. Delgado Kloos & Méndez (2016:38) contend that the formal education system is being complemented by open and non-formal elements, but remains committed to hierarchical degree-granting principles.
Business Model Canvas
The Business Model Canvas (Fielt, 2013; Osterwalder & Pigneur, 2010) is a framework for documenting or conceptualizing business models. The components of the canvas (BizMOOC, 2019:Ch.15) are:
- Value Propositions: A promise of value to be delivered and acknowledged and a belief of the customer that value will be delivered and experienced. A value proposition can apply to an entire organisation, parts thereof, customer accounts, or products or services;
- Customer Segments: What group(s) of customers is/are a company targeting with its product or service by applying filters such as age, gender, interests and spending habits;
- Channels: What channels does a company use to acquire, retain and continuously develop its customers;
- Customer Relationships: How does a company plan to build relationships with the customers it is serving;
- Revenue Streams: How is a company pulling all of the above elements together to create multiple revenue streams and generate continuous cash flow;
- Key Activities: The most important activities in executing a company’s value proposition;
- Key Resources: The resources that are necessary to create value for the customer;
- Partner Network: Complementary business alliances also can be considered through joint ventures, strategic alliances between competitors or non-competitors.
Since the Business Model Canvas was initially proposed (in 2004) new canvases for specific niche markets have appeared Lean Canvas to support startups and the Open Business Model Canvas (including CC licensing) & planning for social good.
Business Model for Sustainability (BMfS)
Täuscher & Abdelkafi (2018) offer a conceptual model which can be extended to other projects or ventures in a generic way, in order to test hypothèses about financial and sustainability performance over time. This approach uses simulation modelling and is intended to reveal performance patterns under different scenarios (n.b. not ‘predict’). The possible limitation of such an approach is that it cannot anticipate or incorporate the kind of radical change that is characteristic of innovation. However, it can serve as a platform for testing various hypotheses at low cost; clarify a company’s value proposition; and how it creates value.
The more entrepreneurial/innovation focused approaches are probably best supported by something like the Business Model Canvas or Business Model for Sustainability. These have an inherent flexibility and ‘open endedness’.
Alternatively, Darwish (2019) has recently proposed a typology for OER business models, as summarised in the following table.
|Model||Definition & providers motivations||Technical requirement, organization & management||Revenue streams & issues|
|Static||This model is content-based (content aggregation & curation) for supplementary use (e.g. repositories, libraries & courseware) |
Motivations of provider: Making educational material available for free &/or creating relationships with the educational community
|open-source platform (e.g. ATutor & WordPress blogs)|
Organization: Classification & categorization model , search engine for updating
Management: DIY, system development
Community production, collaboration & sharing.
|Revenue: None, Donation, subsidizing model |
Issue: Members participation is not sustainable and updated
Lack of committed members
|Interactive||IMM Courses/ products for self-study & blended learning (xMOOCs, Edutainment & Games) |
Motivations of provider: Production-based Industry/Business
|Platform with interactive learning environment such as OpenMOOC multimedia authoring software and audio/video production equipments |
Organization: On-site studio production, IMM learning theory and approaches, AI scenarios
Management: Meetings with institutions & agreeing on the business model or models
|Revenue: Based on level of interaction and optimization of user experience|
Issues: Updating material isn’t feasible, production for different platforms
|Dynamic||Online courses/ blended learning |
Motivations of provider: Distance & Online learning (Online learning environment. cMOOC)
|LMS; Moodle & Joomla LMS |
Organization: University centre
Management: Regulations & Policies for online degree
|Revenue: Units of courses, Online degree Accomplishment/ degree |
Issues: Quality of learner participating content, Workload of instructor
|Transformative||Service-based/Career-based Courses/ |
Motivations of provider: Tailoring projects/ On job training
|Platform with interactive learning environment such as Second life/ game development environments MOOCs/Object Oriented software and audio/video communication channels |
Organization: scheduled, Real time online communication
Management: Recruitments/ Needs Analyses of the market & industry/ transdisciplinary team management/ intermediating contracts between institutions & industry
|Revenue: Platforming/ Brokerage Model: Marketplace Exchange Efficiency/ service-network |
Issues: Outsource parties commitment
As one of the few attempts to systematize business models for OER, Darwish’s table is an important touchstone for anyone hoping to understand fundamental distinctions.
This article included remixed CC BY content from Farrow (2019).
Burd, E. L., Smith, S. P., & Reisman, S. (2014). Exploring business models for MOOCs in higher education. Innovative Higher Education, 40(1), 37-49. https://doi.org/10.1007/s10755-014-9297-0
Darwish, H. Open educational resources (OER) Edupreneurship business models for different stakeholders. Education and Information Technologies 24, 3855–3886 (2019). https://doi.org/10.1007/s10639-019-09962-8
Delgado Kloos, C. & Méndez, E. (2016). Higher Education in the Post-MOOC Era:
Reflections from UC3M. In: Jansen, D. & Konings, L. (eds.). European Policy
response on MOOC opportunities. EADTU.
Fielt, E. (2013). Conceptualising Business Models: Definitions, Frameworks and Classifications. Journal of Business Models 1(1). pp.85- 105. https://journals.aau.dk/index.php/JOBM/article/view/706
Osterwalder, A., & Pigneur, Y. (2010). Business model generation: A handbook for visionaries, game changers, and challengers. New York, NY: Wiley.
Täuscher, K. & Abdelkafi, N. (2017). Scalability and robustness of business models
for sustainability: A simulation experiment. Journal of Cleaner Production. 170.
Ubachs, G. & Konings, L. (eds.) (2016). Enhancing European Higher Education “Opportunities and impact of new modes of teaching”. Overview of papers on enhancement of European Higher Education as presented during the Online, Open and Flexible Higher Education Conference in Rome, October 2016. European Association of Distance Teaching Universities (EADTU). https://repositorio.ipl.pt/bitstream/10400.21/7346/1/Daring%20to%20do%20differently_innovative%20experiences%20in%20teaching%20&%20leaning%20methods.pdf#page=963
Van Dijck, J. & Poell, T. (2015). Higher Education in a Networked World: European Responses to U.S. MOOCs. International Journal of Communication 9: 2674–2692. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2645629