Productization and SaaS as a Strategy for e-learning

e-learning has been a service oriented industry since its inception. Indian e-learning service providers have also traditionally taken on offshored custom services from clients, on an ongoing basis or through annual contracts. According to a ValueNotes report, the revenues from this offshoring market are estimated at $341 million for the calendar year 2008. Trends in the industry now suggest that while the offshore services framework may serve as a good strategy for companies in the short term, future growth for Indian e-learning companies will be sustained by a diversification/upgrading of service offerings.

Productizing for alternate revenue streams

ValueNotes research suggests that e-learning providers will most likely go into the learning products business in the future, for domestic as well as international client markets. This is because scalability is achievable to a high degree with such offerings, and providers are able to target specific new audiences with their products (such as B2C products for English language, primary school children; B2B products for sales training, soft skills). For example, Zeus Learning, an e-learning services company, recently launched its product ‘TestFunda.com’, an online/CD ROM based learning courseware delivery platform for CAT aspirants. Companies looking to diversify from their offshoring services model are concentrating more on developing such offerings in the next year.

Catching on to cloud computing

In keeping with trends in the international e-learning space, Indian companies are also beginning to adapt their traditional software applications into software-as-a-service (SaaS) options. SaaS or hosted software development is a new distribution model through which a service provider hosts his software application (over networks such as the Internet/intranet) for customers to access remotely, without any installations on client machines. The SaaS model works particularly well for the e-learning industry due to a few reasons. Client needs and expectations are well met with hosted solutions as:

* Investments made in e-learning systems are often under contention – through hosted solutions, investments in maintenance (IT personnel) would not be required. e-learning requirements may not be on an ongoing basis (for smaller companies), or dependence on e-learning as a training tool may not be extensive. For various reasons, the pay-per-use or monthly payment options allow clients, especially first- time users, to experiment with a new Learning Management System through a hosted version.
* SaaS is being regarded as a close companion of the Web 2.0 revolution. Indeed, Web 2.0 is changing the way learners access and consume knowledge. Learning is being demanded across channels and platforms by employees at companies, and tech-savvy students at schools and universities alike. SaaS based e-learning platforms will enable users to stay connected 24x7 through remote hosting. SaaS also facilitates collaborative learning opportunities through connective technologies.

Content collected from value note outsourcing website.