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A request recently came into CIS that I think can serve as a model for how our IT development process should operate. While the issue, from initial request to final solution, was handled completely through various one-on-one discussions (which is not how I’d like to see our development cycle run), the discussions and topics mirrored [...]

Assistant Professor Hend S. Al-Khalifa of King Saud University in Saudi Arabia had an idea: Test the effectiveness of micro-blogging service Twitter as a tool for keeping her students informed of updates on a course blog. Though the results were quite positive, harsh marketplace realities may prevent Al-Khalifa and other instructors in Saudi Arabia from ever using the service in this way again.

Liss Neal debuts her new blog for eLearn magazine.

Educators have started recognizing that video games will play a significant role in the future of learning. Online games are the new playground for children and teenagers, and present unique opportunities for rich online learning environments. However, addiction to online games causes educational and social problems for which teachers, parents, and researchers are seeking solutions. And those who create online games bear some responsibility for participants' well-being. I'd like to suggest channeling negative addiction patterns into positive energy by integrating virtual mixed-reality tasks—which can involve real-world community service—into online games.

Online education is where the business and academic worlds collide. So how can one take the successes of real life and apply them to the virtual classroom? By producing lifelong learners. Successful organizations are the ones that have developed generative learning skills focusing on the team. In this article, New York-area educator Edward Volchok shows how team projects can make for a better classroom environment and eventual success in the marketplace.

A learnscape is the platform where knowledge workers collaborate, solve problems, converse, share ideas, brainstorm, learn, relate to others, talk, explain, communicate, conceptualize, tell stories, help one another, teach, serve customers, keep up to date, meet one another, forge partnerships, build communities, and distribute information. Learnscapes are where and how modern work is performed-including workplace learning.

Taking an online course takes time. A poorly designed course, or one that doesn't teach effectively, means lost time that can never be recovered. Time is one of the most precious commodities we have, but in our current economic climate, especially, cost matters too. So I wondered what happens when online students want a refund—or even seek out programs offering a money back guarantee.

e-Literate has been upgraded and is about 90% configured. I still have to figure out how to do a few things (e.g., add a navigation tab for the blog page without breaking other things), and I will continue to tweak it for the next few days, but it’s close enough to be basically usable. Please feel free to poke around and provide me feedback, whether good or bad, on how it looks and works for you.

I’m going to be upgrading my blogging software this weekend. This will mean losing some of the customizations to the site that I really like (but that probably nobody else noticed), but it also means that I’ll be able to stay current with WordPress releases in the future. In the process, I’ll be changing the look and feel substantially. Again, I have mixed feelings about this, but on balance I think it is for the best.

At any rate, don’t be surprised if the blog looks mangled or even is down altogether for a while over the weekend. I’ll post again to let you know when it’s done.

Investors should be pleased with Blackboard’s stock prices. The stock prices consistently outperform the NASDAQ Composite Index. [1]

Financial analysts continue to rate the stock as outperforming the market with buy and strong buy recommendations. Each quarter Blackboard CEO Mike Chasen, CFO Mike Beach and Senior Vice President Mike Stanton brief analysts winning appreciative comments. They also make presentations at conferences of financial analysts with similar responses.

 

For the first time since the acquisition of WebCT in January 2006, during the August 6, 2008 Earnings Conference Call analyst Amy Junker of Robert Baird asked about open source. She asked: “Michael Chasen, I was hoping you spend a minute to talk about the announcement that you made with the plan to develop the Sakai Integration, what exactly do you hope to achieve with that announcement and can you talk a little bit on the timing?” [3] Chasen responded:

Sure at the Blackboard World, we talked about how in the future of our product and this is an issue we are actually working closely with a couple of universities on, that our learning system will be able to load other course management system courses through our interface. One of the issues they were having is a lot of campuses have standardized on the Blackboard system and we are the standard product for almost the entire campus, but there maybe an individual teacher or a very small department that is using either a home-grown system or maybe an open-source solution and then why really should the students or faculty members have to go to a separate url or a separate log-in to be able to access those courses.

So recognizing that Blackboard is that campus industry standard we have actually gone ahead and opened up our course management APIs to allow for home-grown systems or home-developed systems or other third-party systems to be served if you will and load through our interfaces so that you can log in once and access all of their courses whether they are Sakai courses as you mentioned or other open source or home-grown solutions all from the Blackboard Interface and I think this will help improve teaching and learning on the campus because you are able to aggregate all of your courses in one area.

A similar question was asked during Blackboard’s briefing at the CanAccord Adams Conference August 12th. [4] Chasen identified Sakai as the primary of two open source competitors.

Blackboard Strategy

Blackboard has a three-part strategy for financial success.

1. Continue to add features so Blackboard can compete when Request for Proposals are issued or other formal or informal feature comparisons are made during procurements.
2. Expand the product line so Blackboard can “cross-sell” these products to current clients.
3. Broaden the market to include K-12, corporate, government and international clients.

Blackboard has expanded the product line by acquiring products and companies. Blackboard was able to dominate the market by acquiring WebCT—its largest higher education competitor. This was possible because the U.S. Department of Justice considered the larger market in the U.S. including training as well as learning systems. Other firms, such as SumTotal Systems, then have significant market share. Blackboard was then not considered dominate and the U.S. Department of Justice declined to initiate antitrust action.

Blackboard has been able to integrate these products and companies without any significant cost consequences, hence maintaining profitability. The gross margin—revenue minus cost of goods sold—has been steady between 73% and 79% [5] The gross margin for professional services has varied, likely because sometimes professional services revenues are included in product sales (e.g. implementation) with the costs of professional services remaining constant. Professional services is a small part of Blackboard revenue:

With very steady growth product revenue has almost doubled since WebCT was acquired in January 2006.

Blackboard uses subscription pricing. That is, each year there is a charge for using the software for the coming year. Earlier software was priced with a single license fee and then a fee each year for upgrades and technical support. This fee began in the 1960s at 10% and has increased now as hjgh as 26% of either the original or the current license fee. [6] Blackboard has always used subscription pricing and frequently explains the advantages during presentations to financial analysts.

Blackboard has been able to merge companies and products without changing the basic financial model. There has been a general trend to reduce the cost of products and sales and marketing and research and development and general administration as a combination of financial management and economies of scale. The increased cost—predicted by CFO Mike Beach— in recent quarters comes from the acquisition of NTI which is being more widely marketed, especially to government to enhance security.

Even though revenue and expenses have increased steadily, small changes can cause significant changes in profit. Revenue and computed profit and the increasing profit trend are shown in the chart “Quarterly Revenue and Net Income.”

Average Revenue per Client

The success of the “cross selling” strategy can be seen from data given recently by Blackboard. In the seven years from founding to the merger with WebCT, Blackboard’s revenue per client increased 600%. In the period from November 2005 to March 2008 the increase has been 57%. [7]

Retention of Clients

Because of the response of the higher education community to the Blackboard patent litigation with Desire2Learn Inc. and the emergence of open source course management systems, some predicted Blackboard’s client retention rate would decrease. It continues to increase. [8]

Blackboard cites its “suite” of applications and implicit integration as an incentive to retain the software. And it likely is.

Data from the United Kingdom shows some of the trends which may apply to the growing European market as well. These continuing trends: (1) The number of universities and colleges without a learning system decreased an additional 3.8%, (2) The number of “in house” systems that are no longer the principal system decreased an additional 19.9%–a total of 23.7%. 15.4% of this decrease became additional installation of Blackboard Inc. systems, one Desire2Learn installation, and a 7.2% increase in Moodle installations. (3) Open source Moodle continued to be the fastest growing system, likely because its use by Further Education colleges. Systems that did not emerge as principal systems between surveys include: Bodington, Colloquia, FD Learning, Firstclass, Granada Learnwise, Lotus, Merlin, and Top Class. In addition Microsoft Sharepoint was listed as a learning system only in 2005. [9]

The 2007 survey asked for a single principal virtual learning environment (VLE) or learning system; the 2005 survey asked for all installed VLEs. This chart shows 2005 market share for 2005 only for those learning systems (VLE) that were reported in the 2007 survey and the market share recomputed. [9]

Similarly in the U.S. higher education the Blackboard product has a 40% market share and the former WebCT product has a 33% market share. This is down 3% from Fiscal Year 2004. No other product has more than 5% of the market. In various market segments open source, Jenzabar, Desire2Learn and Angel exceed 5%, but are less than 6%. Open source has an 18.2% market share in BA institutions, but not DR or AA. “Course management systems are nearly universally in use at all types of institutions, with more than 98% [up from 96% in Fiscal Year 2004] of DR, MA, and BA institutions reporting having these systems.” 18.2% plan on changing systems within the next three years, up from 13% in Fiscal Year 2004.[10, 11]

The change of learning systems requires faculty retraining—users who have limited time and interest for the task. For this reason fewer colleges and universities appear to be changing than had said they would change. Sun Microsystem’s Scott McNealy, writes: “In business, that’s called a barrier to exit. [Software] companies that create barriers to exit figure we won’t notice until it’s too late when the cost of switching is too high.” [12] Because of the complex nature of college and university instruction and learning, and very limited resources, the “barrier to exit” is high for any higher education learning system.

The Future

The data suggests Blackboard will continue to dominate learning systems in U.S. higher education and have major market share in other countries. With careful cost control, the Blackboard financial team will be able to continue to increase revenue and profitability. And the stock prices should continue to outperform the market average.

Unless there is a major disruption in the market.

There are two possibilities. As analysts asked at the August 6th Earnings Conference Call and the subsequent August 12th presentation at the Canaccord Adams Conference, open source is gaining market share and could become a competitor. At this time one open source system is showing sustainability in the sense of being free of institutional subsidies as contrasted to institutional memberships, payments for services, and external capital infusions. Blackboard did not identify this potential competitor, or provide any data about its performance in the market. [13]

There is a more significant uncertainty. The recent Higher Education Opportunity Act (House Resolution 4137, 110th Congress at the Second Session, July 30, 2008) begins to indirectly regulate faculty choices and use of publisher and open education resources, institutional practices providing learning resources and information about learning resources, and publisher pricing and information practices. Proposed rule-making begins in October and the rules become effective July 2010.

“This fall more than 17 million students will be using publisher-provided online services.” [14] Most of these services are paid for through the purchase of new (not used or rented) textbooks. If universities and colleges decline to pay for these online services, then students will need to subscribe directly with publishers for these learning materials. If so, this bypasses the institutional learning system. With publisher cooperation it may be possible to create a learning management system where “management” then would apply to publisher-provided online learning services. This could obsolete current course management systems and force conversions.[15] Based on past practices, institutions are likely to ask students to pay—especially since that is what the student lobbyists asked for. And faculty will have some difficult decisions.

End Notes

[1] Closing stock price at the end of each quarter. Data from Yahoo Finance, 18 August 2008.
[2] From Yahoo Finance, 18 August 2008.
[3] From “Blackboard Inc. Q2 2008 Earnings Call Transcript” by SeekingAlpha posted 6 August 2008 pages 11-12.
[4] Jim Farmer, instructional media + magic, inc., “Notes from the Blackboard Inc. Presentation at the Canaccord Adams Annual Global Growth Conference 12-14 August 2008, Boston, Massachusetts USA,” page 1, 00:19:02.
[5] These computations are based on data from the Non-GAAP financial statements provided as press releases at the same time the SEC Forms 10-K and 10-Q are filed.
[6] Software licensing may have began in Los Angeles in 1964 based upon the recommendation of Haskins & Sells. They recommended the 10% annual rate though sometimes competition created a rate as low as 8%. National data for that period is not available. This is based on data from Systems Research Inc. The subsequent rates are based on those revealed during discovery in Oracle Corporation’s litigation with PeopleSoft and other firms and publically available as court documents.
[7] The 1998 and 2006 values were given by Michael Chasen in response to a question at the Canaccord Adams Conference; see the notes page 3 00:23:02 The 2005 values were taken from “WebCT, Inc. Transaction Briefing,” Blackboard Inc., 12 October 2005, slide 7.
[8] The 2005 values were taken from “WebCT, Inc. Transaction Briefing.” Blackboard Inc., 12 October 2005, slide 7. The 2008 value was taken from “Blackboard Inc. Q2 2008 Earnings Call Transcript” by SeekingAlpha posted 6 August 2008 page 4.
[9] See James Farmer, “The Use of Virtual Learning Environment Software in UK Universities 2001-2005, 16 June 2006, Appendix A, page 9. Public data for the UCISA (Universities and Colleges Information Systems Association) 2007 survey was taken from their website www.ucisa.ac.uk/members/surveys/cis_2007.aspx on 18 August 2008.
[10] Brian L. Hawkins and Julia A. Rudy, EDUCAUSE Core Data Service, Fiscal Year 2006 Summary Report, September 2007, page 52-58.
[11] James Farmer, “Software Trends in Higher Education: 2002-2004,” instructional media + magic, inc., 27 November 2006, page 3.
[12] Scott McNealy, “Software Hardball,” Dow Jones Reprints, March 3, 2006.
[13] This may be done in another part of this series.
[14] James Farmer, “Distributed Learning is Here: Just Ask Any College Student,” e-Literate, July 20, 2008 (mfeldstein.com/distribute-learning-is-here-ask-any-college-student).
[15] This technology is currently available in systems used for government and corporate training.

According to a blog entry on Desire2Learn’s Patent blog, the US Patent and Trademark Office has denied Blackboard’s request to suspend the re-examination process. Bb and D2L have been fighting over the venue for the next round of the battle, with Blackboard asking the USPTO not to complete the re-examination process (despite having earlier said that a re-exam would only make their patent stronger) and D2L asking the US Court of Appeals not to hear Blackboard’s case until the USPTO issues a final ruling. D2L has won the first of these two battles.

Today Oracle announced the release of the Student Administration Integration Pack, or SAIP. It’s the first product that I have worked on as an Oracle employee, and I’m proud of it for a number of reasons. It’s not a particularly glamorous piece of software, but I think it’s going to be important. This is my first post in a planned series about it.

I’m going to start the series with a few posts about the IMS Learning Information Services (LIS) specification that the SAIP implements. Because, really, the specification is at the heart of the product. Now, let me get one thing out of the way, because some of you are going to complain ask. A draft of the LIS specification has just left the working group and is currently available to IMS members only. It will be made available to non-IMS members by December, after which there will be a better part of a year when it will be open to public comment and further revision from the working group before it is finalized. I know that this schedule makes some of you unhappy. I have complained about it myself. I’m going to tell you as much as I can now and let you know the moment that more information becomes available to the general public.

Anyway….
Today’s post will focus on describing the main pains schools have been experiencing that motivated the creation of the specification in the first place. In later posts, I’ll talk about how the LIS attempts to relieve those pains (again, not glamorous but still important), and then I’ll write a little bit about some of the moderately sexier possibilities that LIS will also enable.
To begin with, LIS is really an updated and renamed version of the IMS Enterprise Services (ES) specification (which is why LIS will start on Version 2.0). ES was originally designed to enable students and courses to be populated into an LMS from a Student Information System (SIS), and to have basic grade information pushed back from the LMS to the SIS. This may seem really boring and unimportant until you try to set up your first class in some Web 2.0 tool where you need to manually invite each student into the group and set the appropriate privileges. Even under the best of circumstances, it is a large and annoying time sink–enough of a time sink, in fact, that most professors simply would not do it. So, back in the days when the campus LMS was (for the most part) the sole online environment where you would want to provision students and classes, the ES specification was created as a standard way for any SIS to automagically provision students and courses to any LMS.

Or so the theory went.

Like version 1.0 software, version 1.0 standards (or even version 1.1 standards) tend to be buggy. This is particularly the case when the standards are created early on and the full scope of the problem being solved, along with all the various sensible implementations of the solution, are not yet fully understood.  In the case of ES, the initial design didn’t fully account for the fact that registrars think differently about courses than teachers and students do. For a registrar, the lecture, lab, and discussion sections for, say, Biology 101 are all distinct entities and not particularly distinguished from all the other Biology 101 sections for a given semester–of which there may be many. But the teachers and students often view one particular trio of lecture, lab, and discussion sections as a distinct “class” because all the same students, TAs, and teacher participate in those sections and do not participate together in any other Biology 101 sections. For the students and teachers, it makes sense to group those sections together as one “class” in the online learning environment, possibly in one unified course site. But because ES didn’t have a standard mechanism for describing these relationships between sections, the LMS would generally receive one record for each section and create one completely separate course site for each section, just as any registrar but no student would find sensible. And chaos ensued.

Different schools dealt with this differently. In some cases they dealt with it on the LMS side by, for example, turning off the course sites for the lab and discussion sections and just using the course site for the lecture section. But this doesn’t always do the job. Suppose you have lecture/lab pairs where the students are always the same, but the discussion sections are all mixes of students from across all the lecture/lab pairs. And suppose further that you want all of the discussion sections to share one course site. You can’t do that by just turning off extra sections. Because this is academia, and because registrars are evil geniuses, there are a million billion quirky exceptions and odd combinations like this one at colleges all around the world.

So many schools decided that the best way to deal with the problem was to merge the section records after they came out of the SIS but before they went into the LMS. The LMS would still create one course site per record, but because the section records are merged, the sites would come out the right way. Schools either wrote custom middleware on their own or paid vendors copious amounts of money to write it for them. This solved the separate-sections-in-the-LMS problem for them, but it also created new problems. To begin with, this middleware is almost never built to operate in real time. The student registers for a class in the SIS, the data goes into a database table somewhere, it gets munged up with other sections (either in an automated fashion by a pre-set rule or manually by some action on the part of the administrator) at some point during the day, a batch process runs overnight, and the student will have access to the course the next day. Or two days later, if the school’s process is particularly inefficient. You can get approved for a credit card or order an intercontinental airline ticket pretty much instantly online these days, but to get access to an online course usually takes overnight in most colleges.

Another problem is that the record munging destroys any possibility of grade integration using ES. In most places, after a teacher spends an entire semester working in their LMS grade book–the online, electronic gradebook with grades that are stored in a modern, electronic database–the teacher has to print out a copy of the students’ final grades, log onto the SIS, go to the grade roster page for the class, and manually re-enter all the grades that already exist in the electronic, online LMS grade book that is storing the grades in a modern, electronic database into the electronic, online SIS grade roster that stores grades in a modern, electronic database. In theory, ES was going to end this madness. It allowed the LMS to say to the SIS, “student X in course section Y got final grade Z”. Very hip. Very now. Very digital. Except that, when you munge up all of those sections in your middleware in order to get them to appear properly in the LMS, you lose the ability to link a student grade back to a section ID that the SIS recognizes. So we’re back to printing out the grades.

But by far the worst problem the custom middleware approach creates is cost in time and money. First, you have to build the darned thing. For a large university paying an external vendor to do it, this can run half a million dollars. Then you have to maintain it. Again, in some large universities, you have 2 or 3 full-time employees dedicated to keeping the software running and up-to-date, managing the merging rules, handling exceptions, etc. Often these are skilled programmers. And if you ever update either system or–heaven forbid–actually replace your SIS or LMS with another system, everything is likely to break. Which means your IT director is going to be very reluctant to change anything, even when your LMS or SIS is hopelessly out of date. (And you thought it was just because he’s mean….)

And while all of this mess has stayed exactly as it has been for nearly a decade, the world has moved on. Colleges now often have 2 or 3 LMSs that they have to integrate the SIS with on campus, plus adjunct applications like course evaluation systems and stand-alone wikis, not to mention many possible Web 2.0 tools in the cloud. ES does nothing for any of these needs. Very few schools support these needs today because they’d have to build this integration from scratch.
So, to recap:

• Students can’t get into their online classes for 24 hours after registration.
• Faculty can’t electronically submit grades from their electronic LMS grade book to their electronic SIS grade roster.
• IT directors can’t update or change their systems without incurring close to job- (and sanity-) threatening amounts of risk, expense, and work.
• Nobody can provision courses and students into the many other systems that could be used for teaching and learning.
• And yet, universities are devoting huge amounts of money and personnel to maintaining the current state of affairs–resources that could be spent instead on, say, making the campus webmail solution less heinous, getting reasonable bandwidth on campus, or (*gasp*!) possibly even installing a wiki or a weblog system.

 And all for the want of a horseshoe nail.
It’s not such a great situation for the vendors, either. (Yes, weep tears of pity for the poor, downtrodden vendors, Dear Reader!) Naturally, customers complain about this sorry state of affairs (as they should). So the vendors rush off and try to create better integration. But the standard is broken, so they have to devote development resources–resources that could be spent instead on, oh, say, making their user interface slightly less unusable, for example–building point-to-point integrations with every platform out there. Integrations that break if the customer upgrades or swaps out a system. For example, Banner has very good integration with older versions of WebCT CE, which is one reason why many campuses are still running an ancient, weak, hopelessly outdated LMS. It’s hard to tell faculty that they’re getting shiny new tools in their shiny new LMS but now they have to enter their final grades into Banner manually.

So, to recap:

• Vendors spend a lot of money and resources trying to build point-to-point integrations.
• These integrations often break with new point releases, so the vendors have to constantly spend more trying to re-fix them.
• And yet, customers are still pissed off because they’re getting a sub-standard solution.

And thus it was that the IMS LIS working group was born. An intrepid band of vendors, colleges, and government agencies, gathered together in a fellowship to travel to Mount Doom, deep in the heart of Mordor….

THE BEGINNING.

First I would like to make some overall observations: I was totally unprepared for this to be a conference of nearly 1600 attendees from around the world. I thought Agile was a small niche. The 29 vendors clearly think they have a serious market. Another 19 were listed as sponsors even though they didn’t exhibit. [...]

I’ve been meaning to write about this for a while. Barry Dahl has a great post analyzing the back-channel comments from our recent panel discussion with Stephen Downes and Robbie Melton. He concludes that only 31% of the posts were productive, by which he means on-topic questions or comments. This issue came up during the panel discussion itself, and Robbie (brilliantly, in my opinion) characterized it as a “teachable moment.”

I think a big reason why there was so much off-topic chatter is that we didn’t really establish clear patterns or norms for how the back-channel would be encorporated into the larger dialog. The audience treated it like an experiment because we treated it like an experiment. I heard some suggestions from audience members afterward about how the technology could be modified to improve the experience (e.g., disallow anonymous posting, shut off the flow when the panelists are talking, have a moderator filter the comments, etc.), but before I would want to try imposing any of those hard limits on the participants, I would first want to try having a little more preparatory dialog with them about the most productive ways to use the backchannel and how we all would like to interact with it.

This is a guest post by Jim Farmer.

As the dominant supplier of learning system software, Blackboard Inc. is “mission critical” to colleges and universities in the U.S. It has been more than two years since Blackboard completed the acquisition of WebCT. Reviewing Blackboard’s performance may provide some insight.

Context

On 12 October 2005 Blackboard announced it would acquire WebCT; its largest competitor in higher education. [1] In a briefing to analysts, Blackboard described the effects of the merger. Blackboard CEO Michael Chasen reported Blackboard had revenue of US$111.4 million in Fiscal year 2004 and WebCT had US$38.4 million. Blackboard had 2,229 clients; WebCT 1,480. Blackboard’s license renewal rate was 90+% and WebCT’s about 88%. [2] Blackboard successfully argued the merged company would not be dominate if the broader software market for training and primary and secondary education—corporate and government training and K-12—was used for comparison. The merger was approved by the U.S. Department of Justice and completed 28 February 2006. [3]

Blackboard also considered Desire2Learn and ANGEL Learning competitors.[4]
Data on the merged companies appeared in Blackboard’s public financial records beginning with the first quarter in 2006. This analysis begins from March 31, 2006, the last day of the calendar quarter. [5]

This analysis, based on public documents prepared by Blackboard Inc, focuses on the learning systems marketed by Blackboard. They include the basic learning system and the enterprise learning system. Blackboard has several product lines, most related to the learning system in some way.

In the 12 October 2005 analysts’ briefing Blackboard identified numerous “cross sell” and “up-sell” opportunities. These included upgrades from basic to enterprise system and cross-selling Blackboard products to current clients. Moving from basic to enterprise system—“up-selling”— increases revenue per client and total revenue.

The WebCT learning system was considered an enterprise product and included in the published counts beginning with March 31, 2006. At the end of 2007, Blackboard counted 5,227 clients including estimated numbers of licenses for the subsequently acquired NTI Group. The NTI acquisition was completed on January 31, 2008. Updated clients counts have not been included in subsequent quarterly earning reports.

Market Segment Number Share U.S. Higher Education 2,082 39.8% International Tertiary Education 932 17.8% U.S. Primary and Secondary 1,707

32.7%

Commercial, corporate and government 506 9.7%

Total Clients, December 2007

5,227

Blackboard Inc. has several licensed software systems.

Product Description Learning System Web-based software system that offers industry leading course management. [7] Community System enables educational institutions to support formal and informal communities online in an easy, efficient and secure manner. The Blackboard Community System also provides a one-stop academic gateway to facilitate better service to all constituencies. [8] Content System [Makes] it easier to manage learning content, digital assets and e-Portfolios in an enterprise learning environment. [9] Outcomes System enables the planning, measuring and improving of outcomes and providesa comprehensive set of instruments for student and program assessment [10] Portfolio (now included in the Content System) allows students and faculty members to collect, store and package milestones and proof-points of their academic, creative, or professional progress. Transaction System helps address numerous challenges by enabling millions of commerce and access transactions on campuses every year. [11] Connect (NTI) the Connect‑ED service for Higher Education offers a bundled set of emergency, community outreach, and survey notification tools [12]

Blackboard has other software products that incorporate several of these systems, supplement these systems, or facilitate the use of non-Blackboard systems.

Learning Systems Licenses

The March 2008 license counts are given in Table 3.

License Type Number Basic 886 Enterprise 2,335 Hosted Services 571 Total 3,792

Although the total number declines because of the decline in basic licenses this does not imply the associated revenue declined. Those licensing the Basic System could (1) migrate to the Enterprise license and, according to Blackboard officials, many did, (2) could have migrated to Managed Hosting, or (3) discontinued use of the product.

According to CEO Michael Chasen, Blackboard’s current renewal rate is 92%–four percent more than WebCT and two percent more than Blackboard in October 2005. Analysis of Educause survey data for 2002-2004 reveals: “The average course management system has been installed for 3.8 years and 13% expect to replace it within three years.” “Analysis of the data shows institutions are [in 2004] changing their course management systems sooner than expected replacement.” 4% planned replacement each year while 13% were replacing the course management system. Because Blackboard has the largest number of licenses, if rates for all are equal, then Blackboard when dominant will lose licenses until equilibrium is established at a lower number—the same number as any other supplier.

During the August 6th Earnings Call, Chasen said: “Our renewal rate for the quarter was in line with where we ended 2007 at 92% and we expect that our renewal rate will remain strong throughout the remainder of 2008.[14, page 4] Another supplier has estimated the renewal rate for their learning system at 98%, [15]

An eight percent non-renewal means Blackboard would have to sell 258 licenses per year in order to maintain the current 3,221 active licenses.

Another way to view the growth in licenses is to compare the number each quarter to March 31, 2006. This change is shown in Figure 2.

Although Managed Hosted Services were offered before, data on the number of clients were first published for March 2007. The growth curve for hosted services was computed from that date.

The quarter-to-quarter change in number of software licenses each quarter is shown in Figure 3. The growth rate for enterprise licenses appears to be decreasing. This could be because of fewer basic licensees upgrading to enterprise licenses, saturation of the market, or marketing effectiveness. An analysis of Educause Survey data included in their annual reports by instructional media + magic, inc. reveals, “Blackboard Inc. is the dominant supplier of course management systems—76% of the responding colleges and universities. No other proprietary or open source system exceeds 5% of the market represented by the respondents. [13]

The change in Hosted Service clients Quarter-to-Quarter is shown in Figure 4. The rate has always been positive and highest before the beginning of the calendar and academic year.

Blackboard Product Lines

The same analytic approach can be used to compare learning systems to other Blackboard products. The results are shown in Figure 5. Pro forma counts from the NTI acquisition of Connect are available since March 2007. The Blackboard Outcomes System was introduced in the second quarter of 2007. The sharp increases in the sales of new products suggest “cross selling” a new product into the current client base has higher growth than Blackboard learning systems.

Computing the average quarter-to-quarter change—that is the compound growth rate—is summarized in Figure 6. From these data it appears new products have a higher growth rate than products introduced earlier. This may also be influenced by whether they complement another Blackboard product.

The data suggest that Blackboard’s strategy of acquiring market share—WebCT—and acquiring products—NTI Connect—does increase the number of licenses. Blackboard also has the opportunity to expand the customer base beyond higher education to K-12 and the training market. If so, the completion will be different and formidable.

Notes

[1] See the press release “Blackboard and WebCT Announce Agreement to Merge,” 12 October 2005.

[2] From Blackboard’s “WebCT Inc. Transaction Briefing,” October 12, 2005.

[3] See the press release “Blackboard Inc. Completes Merger With WebCT, Inc.,” 28 February 2006.

[4] From comparisons shown in Blackboard’s “e-Learning Competitive Landscape,” 20 October 2004.

[5] The primary documents for licenses used for this analysis were: “Estimated Client, License and Contract Value Metrics as of June 30, 2007,” 31 July 2007 (includes all 2006 quarters) and “Estimated License and Contract Value as of June 30, 2008, 6 August 2008. “Estimated Pro Forma License, Contract Value and Headcount Metrics as of March 31, 2006,” 8 May 2006, includes data for 2005, but was not used because comparable data from WebCT was not available.

[6] From “Estimated License and Contract Value as of June 30, 2006,” 8 May 2006, for the end of the fourth quarter 2007. License information for the two quarters in 2008 was given, but the client count was not updated.

[7] From “Blackboard Learning System (Release 6) Product Overview White Paper,” 1 August 2002. See also “Blackboard’s Role on the 21st Century Campus: Products and Services Overview,” 7 February 2007 for additional information.

[8] From the brochure ‘Blackboard Community System,”

[9] Descriptions of the Content and Portfolio systems were taken from Deborah Everhart, “Blackboard Content System Product Overview White Paper,” 23October 2003.

[10] From “Blackboard Outcomes System,” 17 January 2007.

[11] From “Blackboard Transaction System,” 19 December 2007.

[12] From the brochure “Connect-ED,” 12 January 2007. See also “Connect ‑ED® for Higher Education,” The NTI Group, 8 June 2007.

[13] James Farmer, “Software Trends in Higher Education: 2002-2004,” instructional media + magic inc., 27 November 2006.

[14] Quotations from the 6 August 2008 “Blackboard Inc. Q2 2008 Earnings Call” are either taken from the transcript provided by SeekingAlpha or notes taken from the recording by im+m staff. The page numbers refer to the transcript using large type—that is are more than the SeekingAlpha transcript as displayed by the typical Web browser.

[15] The source prefers to remain anonymous. Both Information Associations and SCT had renewal rates for their administrative software between 95 and 98%.

This is a guest post by Jim Farmer

On July 15th Luke Fernandez, Weber State University and frequent Sakai contributor, posted “Moodle and Social Constructionism: Looking for the Individual in the Community” on Academic Commons. Broadly interpreting his post about attending the San Francisco MoodleMoot US 2008, he identified two issues: (1) How does the choice of an instructional method impact the design, development, or choice and use of a learning system? (2) And implicitly from his response to this conference, what conferences and conference programs increase the adoption and use of education methodologies and technologies? Both have been topics of discussion since the San Francisco MoodleMoot; this post responds to those issues.

Constructivism in Practice

Perhaps one of the earliest eLearning systems to be designed to support constructivist learning was Fred Hofstetter’s Serf learning system. (For a summary, see “Lunch with Fred Hofstetter” published on e-Literate). This early Serf development paralleled Blackboard development where Blackboard focused on automating faculty activities at Cornell University. The two systems, at that time, had sharply different designs.

The use of constructivist methods does not necessarily require a specific eLearning system. A example of current application of constructivism is described in Cheryl Reynolds and Liz Bennett’s “A social constructivist approach to the use of podcasts” published in July’s ALT Online Newsletter. Although not described as constructivism, John Mayer, The Center for Computer-Assisted Legal Instruction, suggests “test what has been learned in a formative fashion” as one method of engagement listed by Reynolds and Bennett.

Stanford’s Charles Kerns used Course Works assessments to manage student activities. These requirements were used in the development of Sakai’s Samigo Assessment Manager. During the Samigo design discussions Kerns gave this example: “Attend a session in district court and describe the role of the jury (as an essay answer). The answers were “Done” and the default “Not yet.” A series of such “questions” then has some of the characteristics of sequenced learning.

As the eLearning systems—Blackboard, ANGEL, Desire2Learn, Sakai, Moodle, ATutor and Olat to name a few—increase functionality there are fewer functional differences among the systems. Georgetown University’s Peter Farkas recently commented: “Now the choice of an enterprise learning system depends upon reliability, scalability, and ease of use.” And responsive technical support when it is needed—a requirement for any enterprise system.

Focus on the Use of Instructional Technology

Some observers suggest eLearning Conferences should now focus on instructional methodology rather than information technology. “Tool-based” conferences tend to attract information and education technologists responsible for system development and administration, and assisting faculty use the technology. The discipline-based “conferences” tend to be tracts within the discipline oriented conferences. For example the American Physical Society and Association of Physics Teachers hold conferences and exchange practices and results through the Physics Education and Research series of papers. (The work of the Physics Department at the University of Colorado, Boulder is an exceptional resource). Similarly the American Economics Association’s Committee on Education has an active program in teaching and learning recommending both learning objectives and methods of instruction for undergraduate economics. The Association of American Medical Colleges has a Group on Educational Affairs (GEA) Program Overview that holds sessions at the Annual Conference. The Association of American Law Schools has a Committee on Curriculum now devoted to innovation in legal education and published the Journal on Legal Education as well as workshops for new Law School teachers (that focus on learning theory and the classroom—the knowledge that every instructor should have).

The U.S. MoodleMoots focused on higher education began in 2006. The MoodleMoot was held one day before and at the same location of the Instructional Technology Council’s eLearning 2006 Conference. Martin Dougiamas keynoted the ITC Savannah conference. (More than 1,000 DVDs of Martin’s presentation were distributed in the U.S. and 400 in Europe). Similarly the 2007 MoodleMoot was held one day before eLearning 2007, but in a different location in Albuquerque. This conference was keynoted by Kevin Kelly from San Francisco State University’s School of Education. He focused the conference on the implementation of learning systems. (San Francisco State University now used Moodle). The San Francisco Moodle-Moot was held at a different location and several months later that eLearning 2008, and combined some information technology with instructional technology sessions.

Remote-Learner CEO Bryan Williams has suggested returning to the joint conference arrangement for 2009 because of the number of learning managers and instruction technologists at the ITC eLearning conference. Others have pointed out that a Sakai regional conference at the same time may also be productive. A combined conference could have presentations focused on learning using technology appropriate for any learning system with tracks for Sakai and Moodle or any other learning system. Fernandez’ review of MoodleMoot 2008 suggests this as an alternative. Teaching methods in primary tracks, specific learning systems in other tracks or an early workshop.

There have been some discussions among eLearning Hub’s Jason Cole—one of the San Franciso MoodleMoot organizers , Sakai Executive Director Michael Korcuska, Avron Barr formerly with ADL, and Lisa Petrides and her colleagues at the Institute for the Study of Knowledge Management in Education (ISKME) about collaboration with the discipline-oriented education conferences. Since many faculty have limited travel opportunities and would choose the conference of their discipline, incorporating sessions on instructional technology could extend beyond the enthusiastic early-adopter faculty into the early and late majority. Early discussions are beginning with these discipline-oriented organizations to learn more about their interests.

Further discussion and exchanges may provide additional information about better serving and expanding the teaching community and improving student learning with available learning systems. Fortunately Luke spent his July 4th in his office sharing his experience with all of us.

OK, Dear Reader, I need your help once again. You haven’t let me down yet.

My wife is working on a summer program for high school ESL kids who come from all over the world. She and her colleagues are fairly non-technical. They want to create a map of the world where they can display information about all the students in the program and where they come from. Here are the features I’m looking for:

• Should be able to show an entire world map, since these kids come from all over
• Should be easy for a non-technical person to find the right place on the map (maybe by entering the name of city and country), add a pushpin there, and annotate the pushpin with text, links, and pictures
• Should be easy to embed in a web page
• Should look cool (e.g., zooming in on a locale and picture) on a touch-sensitive smart board

My guess is that these criteria should be easy to meet with multiple solutions. I looked at Google mapplets, but they don’t appear to be embeddable. I’m doing my homework, but if anybody knows can save me time by posting something, I’d be grateful. We’re on a bit of a deadline. Bonus points for any tutorials or real-world teaching examples you can point me to that also hit all of these criteria.

Thanks, folks.

This is a guest post by Jim Farmer.

Martin Dougiamas was named Best Education Enabler at last week’s OSCON (Open Source Conference) 2008 in Portland. The Google-O’Reilly Open Source award was made for his contribution to Moodle, an open source learning system. This is the first year anyone from education was nominated for the annual awards.

Other awards this went to Chris Messina as Best Community Amplifier, Angela Byron, as Best Contributor (Drupal), Andrew Tridgell for Best Interoperator (Samba and Rsync), and Harald Welte, gplviolations.org, as Defender of Rights.

Accepting the award for Dougiamas, Remote-Learner.net CEO Bryan Williams “Thanked Google and O’Reilly for the award and their support of Moodle, and expressed Martin’s regrets for not being able to attend the conference in person. He was honored by this award.”

“Moodle has a vibrant community of teachers, professors and business trainers collaborating on ways to improve learning. Moodle.org has become a real community of practice over the years for the advancement of online instructional design and student management.”

The Moodle Foundation is located in Perth, Australia. Remote-Learner.net is a Moodle Partner.

Hi!  I’m Michael Staton and I’m a guest blogger.  What I say in no way represents Michael Feldstein or his ancestors.  Also, our screenshot here is of our app with Abilene Christian University, a school known for being a thought leader in instructional technology and mobile learning products. (They give their students iPhones.  No, really.  They do.)  I am also not representing ACU, its trustees, nor their ancestors.

So, as I said yesterday, Oracle’s had a short few partners for this upgrade.  With the others included being mainstream LMS systems, you might wonder why Oracle would bother with an upstart like Inigral who hasn’t even invested in a good marketing site.  I hope to answer that question here.  If you read Michael’s blog often, this post will be of interest to you.

We are introducing a product we’re calling “Schools on Facebook” (in private beta) that is a private, secure application (on Facebook) that can be skinned with a schools branding and connect with their current technology infrastructure.  It doesn’t compete with but complements CMS and LMS systems by focusing on socialization and relationship building; more on how below.

It’s a cliche when a start up claims to revolutionize this or that.  So, at Inigral we try to stay realistic: we’re focusing on adding a social layer to what already exists.  We want to change the conversation about the internet in education from one of using the web to “manage courses” to one about using the web to facilitate the relationships that develop on campuses already.  After all, a real learning environment is one built on the mortar of person-to-person exchange.   Why not have an application that focuses on that?

No software is a better example of this than Facebook, which took your campus by storm less than four years ago.  Students started engaging in high-frequency, (some might say mindless) contact that seemed to help students connect with their peers to build and maintain relationships throughout their campus experience.   And you never even paid for it.  Some of you[r colleagues] (not you, you’re too savvy for that) even talked about shutting it out.  But as time went on more of you (and you were early on this one) started to realize what Nicole Ellison documented in her research: that Facebook magnifies the “connectedness” that people feel to your school, one relationship at a time.

Students use Facebook to represent their identity, and they fill out all sorts of information to that end.  Our product, Schools on Facebook, delivers course schedules, majors, organization memberships and other on campus affiliations to Facebook.  It also shows that “campus safe” identity to classmates and instructors, which helps to build conversations by introducing “primer” information,  i.e. “I see you’re a member of the economics club, are you planning on being an economist?”

Students use facebook to talk about school all the time, our application just enables a students’ course information to be a part of those conversations.  It also enables contact between faculty and classmates who are not “friends” with a student on Facebook.  Faculty that have ventured on to Facebook have struggled with whether or not to be “friends,” and the safest bet with the least amount of line crossed is to not be friends.  Through our application, campus exchanges can stay out of the personal part of Facebook, and the personal part of facebook can stay out of campus exchanges.

It has some other great features, too.  But I don’t want to take up any more of Feldstein’s blog with our pitch.

This is the first public announcement that we are currently selecting two more schools to participate in our limited beta this fall.  We’re only taking three, and we’ve signed up one and have a big name other in the pipeline (huge name, actually).  We’re looking for the “right” school, one that’s going to be excited to see what the Oracle upgrade can enable, one that isn’t afraid to say “we think Facebook adds value to our campus,” and one that’s not afraid to talk about using cool technology openly to others in higher ed.
Contact me at mpstaton a t inigral.com if you’re interested.

As you know, the beginning of the school year is a hectic time for all of us!!  I will try to get to all emails as quickly as I can.

Michael just introduced me two posts below.  I’m Michael Staton, and I’m a guest blogger.
As Michael already mentioned, my fledgling start up, Inigral, has been included in the alpha partnership with Oracle’s new release of their SIS. I wanna take this post to toot Michael’s horn a little, as he wouldn’t do something like that himself. Some people have been contentious on this blog as to why he might have joined a company like Oracle. I can’t speak for him but I can say, as someone who believes himself to fight for the forces of good, this next release of Oracle Campus Solutions 9 that he’s been working on is going to be one small step for software, one giant leap for educational technology.

This release has so much excitement attached to it because it enables a real-time relationship between the SIS and third party software, meaning that it’s now possible to run multitudes of prepopulated and always fully updated tools for a university without any extra overhead. Getting a new vendor up and running is as easy as flipping a light switch.

Activating new vendors with such speed and simplicity will result in a paradigm shift: the Higher Ed community will need to reorient its purse strings to move out of the single-stop, clunky LMS and start getting ready for more agile vendors that cost less to operate. Yeah, you heard it, more products for less money. Campuses will also need to change their vendor adoption process from lengthy conversations with all stakeholders coupled with producing top-down buy-in to an approach designed for efficiency, choice, and bottom-up adoption.

Ultimately, having more vendors compete in the marketplace that is your school will result in happy faculty, happy students, and lots of conversations about how to use web tools to improve the campus community. We’re happy to be a part of the dialog.

Tomorrow, I’ll have to toot my own horn and show you how Oracle can sync to Facebook using our product, Schools.

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