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Blackboard's New Bag

October 15, 2012

Blackboard has become the latest company to get into the business of helping colleges and universities build online programs.

The company, which built its education technology empire on selling software and implementation support, has upped investment in its “online program management services” in an effort to compete with a growing number of entities that are taking aim at the many colleges that are scrambling to reassert, or reinvent, their brands on the increasingly crowded frontier of online higher education.

The field of companies courting institutions that need help with the funding and logistics of building a viable online arm is also crowded. Bisk Education and EmbanetCompass, along with Pearson, are perhaps the most visible players, but Academic Partnerships, Deltak, 2tor and Learning House have also built successful businesses doing online program development for colleges.

The demand for such services recently has prompted entities from other parts of higher education to try to get in on the action. The nonprofit Excelsior College earlier this year unveiled ESE (Educators Serving Educators), playing the solidarity card with institutions anxious about falling in with profiteers. And this month John Wiley & Sons, one of higher education’s “big five” publishers that, like its peers, is trying to to be seen as something other than a publisher, bought Deltak for $220 million.

Embanet+Compass, which was formed by a 2010 merger, has reportedly put itself on the market and is said to be close to a sale.

Blackboard wants to position itself as a major company with ample expertise and resources that will not strong-arm colleges into a decadelong contract covering a soup-to-nuts array of services.

“It’s more of an à la carte approach, where [colleges] can pick and choose capabilities they want and not get into this big, comprehensive, long-term commitment where a lot of them are worried about losing institutional control,” said John Kannapell, the new vice president of Blackboard’s online program management unit, whom the company hired away from 2tor earlier this year.

The watchword of Blackboard’s marketing around these offerings is “flexibility.” The idea is to let institutions choose what pieces of online infrastructure they want to handle themselves, then help them contract out the rest, said Kannapell.

Neither Bisk nor EmbanetCompass immediately responded for comment on Blackboard’s move. Richard Garrett, the managing director of the consulting firm Eduventures, says Blackboard may well be able to carve out territory for itself in that market as long as its reputation as a cutthroat corporate opportunist and as a technology-first company does not overwhelm its stated commitment to flexibility and accommodation.  

Craig Chanoff, general manager of Blackboard’s student services division, says the company’s agenda is not use its online program development contracts to up-sell their clients on other Blackboard products.

“There is perhaps some market concern that this is an avenue where Blackboard can push their technology stack into [client institutions’] classrooms,” said Chanoff. But he insisted that the company’s consultants will be willing recommend its competitors’ product when appropriate.

“We are agnostic when it comes to the platforms that institutions are using,” he said. “I’m sure that situation will come up, and at some point we’ll run across a situation where the Blackboard product is not the right solution.”

In recent years Blackboard has begun planning for a future where it does not have to rely on its flagship product, Learn, its learning-management system (LMS), for the bulk of its revenue in higher education. Part of that planning has involved pumping up its consulting and support services. After years of playing down the threat of open-source LMS alternatives, Blackboard in March bought Moodlerooms, a major provider of open-source LMS support services, and formed a new business division around it. The company’s new messaging around its online program management unit is consistent with this move: If you don’t want to use Blackboard’s software, that’s fine -- for a fee, we’d be happy to support you. (Note: This paragraph has been updated from an earlier version to correct the timing of Blackboard's purchase of Moodlerooms.)

“We’re not trying to make this about the use of Blackboard technology,” says Chanoff. “This is about solving a business problem at the institutions.”

For the latest technology news and opinion from Inside Higher Ed, follow @IHEtech on Twitter.

 

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