Friday, March 16, 2018

Open Education Resources Gain

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What price knowledge?  Ask any college student what was the biggest surprise when they first got to school and their answer may well be the cost of a full complement of required textbooks.  So they don't buy them.  And while rental has become a significant revenue stream for publishers, cost still remains a problem for students and many choose to go without - or they borrow or buy an old version.  Over the past 10 years, several institutions and grant-backed organizations have worked to lower the cost of textbooks for students.  Now, this "Open Education Resource" (OER) initiative may finally be on the cusp of radically changing the way higher education course materials are created, distributed and sold.

The findings of a recent report from Babson College (Babson Report) point to a steadily expanding market place for OER textbooks with growing title selection and increases in faculty willing to assign these titles.  That said, the report cautions that awareness of OER course materials is a significant limiting factor, which should encourage all big textbook providers with their large sales forces and embedded relationships. Lack of awareness has always stood in the way of the expansion of OER, as I pointed out in a post in 2016.  According to the Babson report, only 30% of respondents reported that they were "aware" or "very aware" of the availability of OER materials.  While this is not great news, there has been slow, steady improvement in awareness over the past few years.

The other significant limitation is inertia - my characterization.  Fifty percent of faculty report that
'it's too hard to find what I need' so they don't bother.  The higher education system is held together by a large number of low-paid, time-stretched adjuncts, so it is not all that surprising that they don't have time to research new teaching solutions.  Perhaps as older faculty age out of the market this will result in the adoption of new solutions.  The continuing expansion in titles should fuel OER as well. 

In the future, I see OER materials being adopted more readily due to the following trends:
  • Expansion in available titles from a growing list of providers such as OpenStax, Saylor and others
  • Student activists challenging high college costs in general and textbook pricing specifically
  • Government-led initiatives to enforce review and adoption of lower-cost textbook options
  • New education market entrants using OER as foundation products for services and subscription solutions geared to intervention, remediation and improved outcomes.
State governments via state colleges, investment funds and/or dictate have become very instrumental in the development of OER materials.  California freed up funding for 50 new digital open textbooks; New York state recently announced a $8 million investment in open textbooks; and Ohio State has long been one of the leaders in a university-led open textbook initiative.  These are all powerful forces which continue to drive the creation and acceptance of OER materials on a broad scale.

The potential and the opportunity for OER materials can be seen in the results for OpenStax, which is described in the Babson report:
The rate of adoption of OpenStax textbooks among faculty teaching large enrollment courses is now at 16.5%, a rate which rivals that of most commercial textbooks. This is a substantial increase over the rate observed last year (10.8%). Users of OpenStax textbooks also had levels of satisfaction equal to their peers teaching introductory level courses who had selected commercial textbooks. These adoptions address concerns about cost as well: faculty who did not select an OpenStax textbook reported an average cost of $125 for the required textbook, while those who did select an OpenStax text reported an average cost of $31.

The OpenStax results among large enrollment introductory-level courses shows that OER can be successful.  OpenStax has been able to reach penetration levels equal to most of their commercial competitors, with equal levels of faculty satisfaction, in a very short time.  This comes amid continuing concerns on the part of faculty about the limited nature of OER materials, particularly the lack of associated materials like tests, quizzes, and homework assignments, that are typically provided by commercial alternatives.
(The entire report is here)

Over the past 15 years, a tremendous sum of money flowed to new education companies with new ideas and approaches.  One of those companies was Knewton, which took in over $150 million in investment but saw only modest success with their assessment-based tools.  Now under new management, the company recently announced a pivot which takes them aggressively into the OER market.  Knewton will make use of OER content but will sell other services and solutions around the content to students. (Knewton Pivot).  Knewton's experience may show for both traditional publishers and other content providers how to use OER materials effectively to help redefine their product suite and their relationship with students.

The market opportunity for OER content is clear though title breadth and awareness have been limiting factors in market expansion.  But these constraints are already easing and are likely to be less of a factor in the coming years. The large established textbook publishers are going to find their businesses significantly challenged by the movement to OER and it will be interesting to see how these publishers address this strategic threat: do they embrace OER or try to compete with free?  Over the next three to five years the business model for college textbooks - especially at the intro course level - will be radically different.  How traditional publishers navigate that change will define whether they survive into the next decade.

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