Venture Capital and the Future of Open Education

Boheken Heart, Bologna

Cross-posted at Inside Higher Ed

The End of Free at Flat World Knowledge

News broke on Friday (via The Chronicle of Higher Education, reporting on a blurb from the National Association of College Stores’s newsletter) that the open textbook publisher Flat World Knowledge would be ending access to free versions of its textbook as of the new year.

The publishing company was founded in 2007 as the first commercial provider of open textbooks. These textbooks were available — for a fee — in print, digital (ePUB and PDF), and audio formats. But (up ’til now) students could always access the entire Flat World Knowledge catalog for free via the Web. According to figures cited by David Wiley at SXSWedu last year, about 35% of Flat World Knowledge’s users did opt to buy a printed version. But CEO and co-founder Jeff Shelstad told Inside Higher Ed that ““we don’t convert [from free to paid] as much as we used to.”

It’s not surprising that there’s already been a lot of ink spilled (tweets tweeted, what have you) since this story broke. (See: David Wiley, Stephen Downes, Geoff Cain, Pando Daily.) Flat World Knowledge has long been hailed as a darling in open education and in ed-tech circles by taking on the powerful incumbants of the textbook industry with a new licensing and new business model.

Flat World Knowledge also took on some $26.2 million in venture capital, according to Crunchbase, from investors including Bessemer Venture Partners, GSA Venture Partners, and Random House.

As David Wiley suggests, it seems that the company’s board of directors (which is comprised in part of its VCs) “didn’t have the patience to stay the course,” opting to axe the free textbooks rather than — Wiley’s suggestion — adjust the Creative Commons licensing so that the FWK books were amenable to the new open textbook initiatives in California and British Columbia. The latter are CC-BY while Flat World Knowledge’s books have been — up ’til now at least — CC-BY-NC-SA. Of course it’s not clear if they will or can remain openly licensed at all.

2012: The Year of the Open Textbook MOOC

All told, it’s been a pretty interesting year for digital textbooks, openly licensed or not. I’m on the cusp of kicking off my “Year in Ed-Tech” series in the next few weeks, and digital textbooks will certainly be one of the trends I examine. A quick recap: 2012 has seen a digital textbook announcement by Apple, open textbook initiatives in California and British Columbia, a lawsuit against the open textbook startup Boundless, and plenty of proclamations by federal and state government officials alike that it’s time to ditch the old paper copies.

But even with all the supposed changes to textbook publishing — from established companies, by startups, through government proclamations, via hackathons — it doesn’t appear that things have changed fast enough. Not fast enough for a company like Flat World Knowledge to maintain its old business model having raised some $26 million in investment. And not fast enough to keep up with the changing ways in which the Internet can deliver educational content, and deliver it free and openly.

After all The New York Times just crowned 2012 the year of the MOOC, not the year of the digital textbook.

It’s worth noting here that the “open” in many of these new MOOCs simply means “open enrollment” and doesn’t mean “open educational resources,” something that prompted Creative Commons’ Timothy Vollmer to pen a call to “keep MOOCs open” — freely accessibly and openly licensed.

Open Education and Venture Capital

Much like Flat World Knowledge, two of these new MOOC startups have raised substantial venture capital: some $22 million for Coursera and $15 million for Udacity. The funding’s still fresh, and so it’s too early to tell not only what these companies’ business models will be or if their VCs will have to step in at some point down the road and insist that, in order to increase revenue, that “free and open” become “commercialized and closed.”

But I think we should ask nonetheless: what role do we want VCs to have in financing open access to education?

What can we -- teachers and learners -- expect in return?

Can these projects — free and openly licensed — be reconciled with VCs’ need for a return on investment? Maybe.

A better model to follow for these efforts — better than the investment or business models of traditional publishers or for-profit universities — might be open source technologies. (See Stephen Downes’ formulation of “predatation versus production.” See also Tim O’Reilly’s “The Clothesline Paradox and the Sharing Economy.”) Many companies that offer open source technologies (including Automattic’s WordPress and Cloudera’s Hadoop) charge for premium services. But the code remains free and open, entrusted to the community. There it cannot be sealed back up behind closed doors like we’re about to see happen with Flat World Knowledge’s textbooks and like I fear we may eventually see with some of these MOOCs.

Photo credits: H. Matthew Howarth



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