Perhaps the best-known is VIPKid, a startup that connects North American teachers with Chinese students, while DaDa is another strong e-learning platform. This educational trend is leading to increased competition for online learning providers in China. Illustrating the potential for growth, the report pointed out that only about 37% of Chinese parents paid for online after-school tuition compared with 70% in Japan and South Korea. Edwin Chen, an analyst at UBS, concurred: “Chinese parents have high expectations for their children, wanting their kids to get into Tsinghua or Peking University. Liu Jiehao, an analyst at consultancy iiMedia, credits government support, technological progress and a cultural emphasis on education. UBS research estimated the value of the Chinese online learning market would grow to $104 billion by 2025, a huge increase from last year. China Spend Tops the ChartĪlthough the US remains the largest education-services market in the world, the strongest growth trend appears to be in China, which has prioritized education spending since 2010. UBS research Opens a new window has found that a growing middle class in emerging markets and increased urbanization offer attractive growth drivers for institutions and companies providing education services generally, with online education platforms and other “ed-tech” services showing the potential to reduce education costs for low-income students. Market researcher Technavio Opens a new window estimates that the compound annual growth rate of the US market at 20% between 20, with the rising penetration of mobile devices a key factor. Research shows that online education is growing strongly across the world. During that same period it acquired a majority stake in US university services provider HotChalk. With its physical base in Wisconsin, the company has an online library of nearly 22,000 courses used by 750,000 individuals and 19,000 business customers.īertelsmann is one of the few big companies to invest in the area, along with US publisher John Wiley and, to a lesser extent, education publisher Pearson, which retains more of its focus on the US school and college market.ĭespite the fact that the German group’s education business, which includes subsidiary Relias, is still relatively small, it achieved significant revenue growth Opens a new window of 21% to €111 million ($129 million) in the first half of 2018. In the future, we expect this share to rise to around 30%.” Big Niche Investmentįounded in 2007, OnCourse Learning provides digital corporate and advanced training courses for healthcare and financial services customers, as well as a more minor real-estate interest. “At the same time, the transaction will further strengthen our presence in the US, where we already generate more than 20% of our revenues. “We are expanding our education business to include a company with significant growth potential,” said Bertelsmann’s chairman and CEO, Thomas Rabe Opens a new window. The deal also underlines its commitment to the digital education sector, shown by research to be on a strong global growth trajectory. The purchase is the latest in a series of deals Bertelsmann has made in the US market, and one that already generates about a fifth of the company’s sales. German media and publishing group Bertelsmann announced has announced a deal to buy US online education provider OnCourse Learning from private equity firm CIP Capital for approximately $500 million.
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