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The NYTimes Highlights the EdTech Opportunity
August 20, 2012 - 9:00pm

Dateline 8/19/12.  A New York Times headline screams:

"Media Companies, Seeing Profit Slip, Push Into Education"

"Movies, television, newspapers and magazines are in decline or facing headwinds, putting pressure on media companies to find new areas of expansion.

Education is emerging as an answer, largely because executives see a way to capitalize on the changes that technology is bringing to classrooms — turnabout as fair play, given the way that the Web has upended major media’s own business models."

Who are the media companies dipping into the education business? 

They include: Discovery (the cable TV company), News Corp, NBCUniversal, and Walt Disney.

The current education business focus of these media companies appears to be the K-12 market, but how long will it be until these same media companies look for a slice of the $4.5 billion dollar higher education textbook market? Beyond textbooks, annual higher education spending is somewhere North of $475 billion a year.  

What could media companies bring to the education sector that traditional publishers and technology companies lack?  

First, the market for edutainment will much larger than we realize. Consumers will pay for learning experiences that retain the production values and narrative drive of the best games, movies, and television shows. The growth of open online learning will also open up a larger market for exclusive learning experiences.  Media companies are well positioned to serve this high end.

The second area where I see media companies having an impact is in figuring out new business models for education. We have never been able to figure out how to make advertising pay for education at scale. We would all be better off with more experimentation in education.

Finally, I could see large media companies getting serious about the educational space via strategic investments in edtech startups. It is possible to buy into the educational space at much lower multiples than in other technology sectors (say gaming) - opportunities abound.

What were your reactions to the NYTimes article?


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