|Posted On January 14, 2014|
There has been much press for the massive open online courses or MOOCs, including in my series of interviews to date with Sebastian Thrun and Daphne Koller, CEOs of Udacity and Coursera respectively. If one is new to these companies, one might be under the impression that the MOOC phenomenon is less than two years old. That is not the case. The company that many credit as being the first ever MOOC is Advance Learning Interactive Systems ONline, better known as ALISON. Irish-American entrepreneur, Mike Feerick founded that company in 2007, and whereas many other companies in this industry are still trying to determine the business models, Feerick has nearly seven years of testing, experimenting, and succeeding behind him. In this interview, Feerick talks about the genesis of the idea, his rationale for focusing on vocational training, and his vision for the future of the company.
Peter High: Mike, as a MOOC pioneer, what was the inspiration behind ALISON?
Mike Feerick: Spreading education more broadly has long been a passion of mine. I worked in a number of internet businesses in the 1990s and also had exposure to philanthropic giving. This experience showed me that no amount of money invested in the traditional educational channels would suffice to overcome the problems in the sector. During the Christmas holiday of 2005, I read a book about Google GOOG -0.59%, and as I read on, I realized that with the decreasing costs of servers and bandwidth, and the increasing ability to monetize any webpage via the likes of Google, it would be possible to provide self-paced education and skills training online for free on a sustainable basis. For MOOCs, once the digital content has been created, the marginal cost to share it is nearly zero.
ALISON started with seven computer literacy courses because it was a very practical field of focus. Prior to launching ALISON we charged for the service, however when we changed our model to free, a curious thing happened: our paying clients wanted to continue to pay as they did not believe that something free could also be of sufficient value! We have changed a lot of minds on that score, and in that sense ALISON has helped open up the market for free education for other MOOCS to follow.
PH: How did you come to the conclusion that you wanted to focus on vocational training as opposed to, say, liberal arts courses?
MF: I believe that workplace learning is where the biggest market is and where the biggest impact can be made worldwide. Education at the primary and secondary levels through to associates degrees is quite similar no matter where you are in the world. This content will be commoditized online to a great extent. It will be difficult to compete in this area. The real action is in the workplace which is limitless in its expansion.
Our focus has been on practical content. This goes from topics like typing and learning a language to STEM courses, which have a practical application in the workplace. Leveraging our advantage of the head-start we have in this industry, and having a much more international footprint than our competition, we believe we are well positioned.
We have not affiliated with any university because the cost of alignment to a traditionally accredited model is prohibitive and not sustainable for a free learning model. Our content focus is more basic, from degree level downwards, not at PhD level in any case. Furthermore, our “dynamic certification” model, where standards continually change as knowledge and skills expand means traditional accreditation won’t work at all. Traditional accreditation is far too expensive, too slow, and reaches far too few people. There is a huge world out there we need to educate and train, and it won’t be done via old methods. Corporations now have the opportunity to certify knowledge and training about their own products and services, enabling them to be used much more effectively, and they are engaging this opportunity.
We take pride in the fact that people can get accreditation through ALISON, and they will not be in tremendous debt by the end of the courses they take – for the sake of a well-known (or not) university stamp of approval. We operate a competency-based accreditation system, positioning ourselves with employers to make accreditation accessible to all. A person who claims to have passed a course on ALISON can be tested by an employer in the interview using the ALISON platform on any device, anywhere, anytime, on any subject. It opens up the world of accredited learning to everyone for free. This is an additional source of differentiation.
PH: How do you find content for ALISON?
MF: We are quite selective, but we accept high quality content from almost anyone. We are careful how we curate the content. Our content comes from authors, professors, companies like Microsoft MSFT -2.94%, and organizations like the British Council.
ALISON functions as a filter for the content that is online in the vocational space – people produce it, we streamline it, telling content creators how to format it, advise them on how to make it more explanative, and the like.
PH: What metrics or key performance indicators do you hold dear?
MF: One of the metrics is completion rate: it is 18% for ALISON, which is higher than most MOOCs because all our learning is self-paced. More importantly than that, we look at how people are coming back after spending the first 10 minutes on ALISON. To judge the completion rate from those who initially peruse a course is misleading. They have not yet made a commitment, and we should expect that a number of people will try something, and determine that it is not for them.
It has also been interesting to note some of the differences across continents. For instance, in India, people put extraordinary value in learning for the sake of a certification, whereas in Africa, there is a huge thirst to learn for the sake of learning.
PH: What is the revenue model for ALISON?
MF: Advertising on the website is a big part of it. Advertising has an interesting side-impact in that learners clicking advertising in the developed world pay for courses in the developing world.
We charge for premium services. On the whole, what services we charge for are few and are generally low cost. Our business model is that we make up on high volume what we lose on low cost. With millions of learners worldwide, this still amounts to meaningful revenue for the company.
PH: Describe the ALISON team.
MF: For all that we do, the team is small. We have a staff of 30 people primarily based in Ireland representing eight nationalities. We are planning to hire five people a month for the foreseeable future, so the team will grow substantially in the year ahead. Our biggest markets are the United States, India, the UK, and the Middle East. Our team reflects the different nationalities that are strongest for us.
Peter High is the President of Metis Strategy, a business and IT advisory firm. He is also the author of World Class IT: Why Businesses Succeed When IT Triumphs, and the moderator of the Forum on World Class IT podcast series. Follow him on Twitter @WorldClassIT.