ELearning Market Update (November 09)

This month we report on the latest survey of the market for self-paced e-learning by Ambient Insight. We are pleased to see that they now include a section on open source e-learning solutions and the rise of Moodle. We are also pleased to be name checked in their report as a key player in this space.

The key findings of the latest report are:

  • the US market for self-paced e-learning products reached $19.7bn in 2009
  • the five-year compound annual growth rate is 7.4%
  • the growth rate is growing in all market segments
  • the majority of revenues are in the corporate sector despite a decline in corporate revenues in 2009
  • the corporate sector will be the biggest sector by revenue throughout the next 5 years

The report makes generally happy reading for all those involved in the e-learning market, though forecast demand for different services varies for example, the forecast growth rates over the next 5 years are:


  • Hosted platform services - Up about 12.5%
  • Non-IT e-learning content - Up about 9%
  • Installed platforms - Up about 6%
  • Content services - up about 3.5%


  • IT elearning content - Down about 6% - maybe everyone has what they need by now?
  • Software tools - Down about 8% - curious finding, given how many organizations are taking basic development in house. Certainly not what we're seeing in the UK and US.

The report includes a section on revenue opportunities in the Corporate open source segment. There is clearly growing interest in open source in the corporate sector as we have witnessed from the demand of our own corporate clients for open source solutions. It is nice to see ourselves recognised as a small but growing player in this sector.

The report notes the the landscape for self-paced e-learning in the US is still highly fragmented. Ambient identify eight distinct market segements with different suppliers in each. They argue there are no market leaders but "significant revenue opportunities for suppliers" with new suppliers emerging at a steady rate. They argue that competition is fierce and being waged by US and global suppliers competing heavily on price. Ambient expect to see e-learning suppliers achieve higher revenues but lower margins over the next few years. Our view chimes with this: there are no national e-learning players in the US for custom e-learning. Our modest intention is to change that, of course...

We ourselves have seen continued strong growth across the e-learning sector and even the growth in open source solutions has not dented the growth of some proprietary providers as market revenues overall increase. For example, despite the growth of Moodle in the education sector Blackboard's share price is up 45% over the last 6 months. In November they reported third quarter revenues of $98.4m, up 18% on the previous year and net earnings of $4.3m. One of the good performances we have seen from a large quoted e-learning supplier, though eclipsed by Saba's share price, which is up 250% over the last 12 months.