How Will Pearson Spend $2 Billion More On Education?
Pearson was already the biggest education company in the world. Now its education business is getting even bigger. In the last several weeks the company has sold off its two major media brands, the Financial Times (for $1.3 billion), and The Economist(for about $730 million).
This move is part of a general moment of back-to-school upheaval in the education industry. News Corp has just announced that its much-hyped ed-tech brand Amplify is a $371 million writeoff. Yet at the same time, ed-tech venture capital deals havedoubled in the last 12 months to a reported total $2.3 billion. Chinese ed-tech companies, in particular, are raising lots of money.
There is a lot of room for everyone to grow. Pearson says it currently does $5 billion worth of business annually in the U.S. That's out of what the company estimates is a total of $1 trillion dollars spent each year on education — most of it public money.
As digital technologies continue to play a larger role in both instructional delivery and assessment, many observers see a larger role for private industry as well.
"In the future world there are going to be more public-private partnerships in education," says Pearson's North American CEO, Don Kilburn. In other words, this isn't just about the expansion of a few companies — this is about the maturing of an entire sector.
Pearson CEO John Fallon announced that thanks to The Economist and FT sales, the company is now "100 percent focused on our global education strategy." In a blog post,he elaborated:
"In recent years, we've developed an increasing focus on our biggest, most exciting opportunity — to help people make progress in their lives through learning ... it's become clear to me and the Pearson board that the scale of the challenge requires our undivided attention."
But is all this money and attention good news for learners?
Prove You're Good
Amar Kumar says it will be. He is a Senior VP at Pearson and part of a relatively new unit called "Efficacy & Research." And he says the company wants to bring more "rigor and transparency" by measuring the impact of everything they do.
"This company is serious about doubling down on education," he says. "We care about it. We feel like we're well equipped to do it. The efficacy agenda ensures that when we do it, it's going to be with the right level of quality and rigor."
Since 2013, Kumar says, Pearson has begun evaluating all its investments and partnerships not only on financial performance (Can we get customers and make money?) but also on educational performance (Can we help learners succeed?).
It may seem like a pretty basic proposition: Invest in products and services that can How Will Pearson Spend $2 Billion More On Education? : NPR Ed : NPR:
