Monetizing EdX

Reblogged from Chronicle.com
by Steve Kolowich

How can a nonprofit organization that gives away courses bring in enough revenue to at least cover its costs?

That’s the dilemma facing edX, a project led by Harvard University and the Massachusetts Institute of Technology that is bringing in a growing number of high-profile university partners to offer massive open online courses, or MOOCs.

Two other major providers of MOOCs, Coursera and Udacity, are for-profit companies. While edX has cast itself as the more contemplative, academically oriented player in the field, it remains under pressure to generate revenue.

“Even though we are a nonprofit, we have to become self-sustaining,” said Anant Agarwal, president of edX. And developing MOOCs, especially ones that aspire to emulate the quality and rigor of traditional courses at top universities, is expensive. Harvard and MIT made an initial investment of $30-million each last year to start the edX effort.

Legal documents, obtained by The Chronicle from edX, shed some light on how edX plans to make money and compensate its university partners.

According to Mr. Agarwal, edX offers its university affiliates a choice of two partnership models. Both models give universities the opportunity to make money from their edX MOOCs—but only after edX gets paid.

The the rest of this essay here.

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