The NYT had the first article on Coursera:
As part of a seismic shift in online learning that is reshaping higher education, Coursera, a year-old company founded by two Stanford University computer scientists, will announce on Tuesday that a dozen major research universities are joining the venture. In the fall, Coursera will offer 100 or more free massive open online courses, or MOOCs, that are expected to draw millions of students and adult learners globally.
And this one has the contract with its partner institutions.
The contract reveals that even Coursera isn’t yet sure how it will bring in revenue. A section at the end of the agreement, titled “Possible Company Monetization Strategies,” lists eight potential business models, including having companies sponsor courses. That means students taking a free course from Stanford University may eventually be barraged by banner ads or promotional messages. But the universities have the opportunity to veto any revenue-generating idea on a course-by-course basis, so very little is set in stone.
And this on the economics:
When and if money does come in, the universities will get 6 to 15 percent of the revenue, depending on how long they offer the course (and thus how long Coursera has to profit from it). The institutions will also get 20 percent of the gross profits, after accounting for costs and previous revenue paid. That means the company gets the vast majority of the cash flow.
I enrolled in the Database and Machine Learning courses in the precursor to Coursera last fall and I’m honestly still astonished it was all free.
I think they could definitely charge some small tuition fee and still attract literally millions of people for some of these classes. There’s a lot of money on the table there and a LOT of it is going to come from outside the US.
I am not confident that anything will seriously threaten the status economy of higher education. This might enhance it.
Imagine this model: online courses offered by MIT are 150% as difficult as the real thing because it teaches the same material with far less instruction. Class sizes can shrink and scholarships are offered to outstanding performers from the MOOC.
Suddenly it’s harder and cheaper to get into MIT.