© Board of Innovation, 2012

Gilfus Education Group (2012) Coursera will profit from ‘free’ courses, competition heats up, Gilfus Education Group blog, undated, accessed November 12

Gilfus Education Group, an independent third party think tank out of Washington, DC, sets out eight ‘monetization strategies’ for MOOC providers such as Coursera, and three possible business models (Freemium, Value-added, and Corporate Social Responsibility).

The blog also provides links to three contracts publicly posted by institutions with Coursera contracts (Michigan, Illinois and Toronto), where it appears that the institutions get between 6-15% of revenues (presumably just from their own MOOCs), while Coursera gets 20% of profits, after all expenses are paid (presumably the venture capitalists/investors get the other 80% of profits).

Gilfus comments that: ‘Sustainability is not assured with the MOOC organizations until they can find an economic model that rewards all stakeholders. It might in fact be easier for existing LMS companies to pursue these models as the technology already exists on campus. Simply put companies like Blackboard, Desire2Learn, Moodlerooms and others are quickly devising strategies to develop high quality courses in addition to their current capabilities.


Indeed, all a company like Desire2Learn or Blackboard needs to do is set up a portal of online courses available for free from existing universities already using their LMS for fully online credit course delivery (with the institution’s agreement of course). Instructure’s Canvas Network already does this and already has ‘open’ courses from several universities (University of Central Florida, Ball State, Brown, Utah State and the University of Utah are just examples)

But even that isn’t really necessary. If the institutions are already offering online courses for credit, the institutions could handle the rest, making available very quickly, for free, a vast range of  quality online courses, but not for credit, so why would they sign up with Coursera, or even an existing LMS company?

The universities already with credit online courses just need to tweek their registration system to distinguish between free, not-for-credit students and tuition-paid credit students. The non-credit version is unlimited in admission, but non-credit students get no tutorial support or individualized assessment (as in current MOOCs), whereas the credit students get the full works. This is an extremely low-cost way of opening up all your teaching to the general public. The only advantage of using a third-party portal such as Desire2Learn or Coursera would be to have one central point with a vast range of free courses from many different institutions (such as iTunesU). However, there would be no direct profit to the universities from this approach.

But just in case you were under the impression that it is openness that these institutions are interested in, I need to disabuse you. You have to wonder why publicly-funded universities in particular (such as the University of Toronto) want to join Coursera if it’s not to make money. Isn’t there though some conflict of interest here, or am I missing something? (Perhaps we should change the name to MOCCs – Massive Online Corporate Courses).

What elite institutions such as the University of Toronto are doing in fact is trying to get into online learning on the cheap, and for profit, after years of turning their noses up at it. But now Stanford, MIT and Harvard are doing it, it’s OK. Shame on them.

Thanks to Richard Pinent, University of Ottawa, for directing me to the Gilfus Education Group blog post.


  1. Hi Tony,

    Totally agree with your final comments and yes, it should be easy for universities to open their courses using their existing LMS. In practice many universities have developed unnecessarily complex, tight integrations between student management systems that manage both the population of student enrolments in the LMS and, often, user authentication. The end result means that it is difficult to simply open up existing courses.

    Mind you, in my experience, only a tiny fraction of courses in many university LMSs should be allowed to see the light of day. The vast majority present a huge risk to a uni’s reputation. That’s without even starting to look at the enormous copyright issues that arises from many academic staff members willful ignorance of copyright rules.



  2. Hi Tony
    I am so glad you opened up the discussion the fine line of MOOCs. or rather overall online strategy of the world .

    1.- ONLINE has been misused by for profit schools ( even making $ 1 billion profiti you know who is that ) ; unfortunately online has been misused by private and even state universities too .
    They charged the same tuition to online courses just to make money since there was a demand . Therefore even state universities made huge profits , but where those profits gone, that is a question too .

    2.- Elite universities did not go into online business. The reputation of online was so bad how come they would involve with it . They did not make their name be dirty with the notion of online .

    3.- So 1300 colleges are now offerring credit and degree programs with online .( I went to 2 of them by paying $ 1,500 per course , Not satisfactory at all .) All selling courses at $ 1,500 level . Shame on them . A small scale and sure expensive courses, even no quality at all .

    People did not complain about the quality of these degrees for 15 years, now they critisize the quality of online provided by MIT and Harvard . And say ” how MITx can provide credits,” even though they did not start to give credits .

    4.- MIT as always with great wisdom started online strategy in 2001 by OCW .
    I suggested to them at that time to provide online. They said no . I was too quick to jump ahead . But they were not . They had a long term strategy. Now they have 100,000,000 students and teachers around the world .

    In December 2011 they declared MITx . I wonder if Coursera knew about MITx when they decided Coursera .

    Be careful MITx is still very cautious about how to progress . They watch out .
    They know very good that they can sell a course at $ 10 to millions in the world . But they do not want to be disruptive . They want people to digest the whole things .

    In a way Coursera came at the right time . They are marketing genius . They made online famous within 4-5 months. Tony you and I and even Sloan Consorsium could not do it in 20 years .

    5.- I am opposing your idea of providing 2 kinds of online in one college, for fee and credit + no fee no credit .
    a) Not all colleges can provide online, it requires scale .

    b) Since the cost is much lower then colleges should have supplied online courses to everybody at cost + a reasonable profit. Difference between online and oncampus could have been huge. But let it be . Then the college would register more online students also enrich its online courses by the profits it makes There would 1/4 oncampus and 3/4 online students . What was wrong with that .

    Plus it could share its online courses by other colleges too . And today there would not be a HE problem of USA . You are one of the partner to that situation .

    6.- Today EDX is doing the right thing. But it will take time for them to provide a degree , maybe 4-5-6 years . The best solution for time being is ” colleges should adopt edx and some coursera courses in their curriculum and award credit toward degrees of their school. That would save the colleges as well . see my blog

    7.- I appreciate Coursera for their making MOOCs famous . But they should be more careful to accept members to Coursera . More schools would cease the quality of Coursera and elite schools start to pull out .

    There are lots to be said. But Tony you are the professional , I am an amateur .
    Professional people of a country should convince the policy makers .
    Duncan was willing to listen to MOOCers some time ago . What happened . ?

  3. The best solution now is the solution made by ANTIOCH University.

    Share the the courses of MOOCs
    1.- Assign a facilitator to each online courses
    2.- Give credits toward a degree
    3.- Adopt as many as possible online courses from good quality MOOCs .

    Automaticaly existing bad online degree programs will be closed .


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