COVID-19 intensified existing trends in the ed tech market, specifically an increase in investment. Some experts say the pandemic was only a part of the cause, and the trend is likely to continue after it’s over.
For all the challenges that came with COVID-19 school closures, they may have been a boon to the market for educational technology. According to the research firm the Learning Counsel, K-12 districts in the U.S. alone spent $35.8 billion in 2020 on hardware, software, curriculum resources and networks, representing a more than 25 percent increase over 2019. While market analysts’ projections about the future vary widely, many expect investments in classroom technology will remain on an upward trend — even after the pandemic becomes a memory and the majority of schools go back to full-time, in-person learning.
According to business consulting firm Grand View Research, the worldwide ed tech market is projected to reach $285.2 billion by 2027. The firm’s analysts noted that the market had been inching upward until 2019, when it reached a total of $76.4 billion, and ed tech investments are expected to continue to grow by 18 percent from 2020 to 2027.
Lisa Snell, director of K-12 policy partnerships at education philanthropic nonprofit Stand Together, said the growth of the ed tech market could be partly due to a cultural shift in education that has increasingly encouraged digitization. She said it might also have to do with growing skepticism from the public about the perceived rigidity of the American education system, and she expects the demand for individualized learning options will continue to play a role in school district spending.
“I think we’re in a cultural inflection point where people have been able to have an individualized educational experience [through ed tech], and that paired with the fact that digital infrastructure has lowered the barriers to access, I think, is the key,” she said.
“Up until very recently, culturally, we’ve had a very standardized, factory-model education system, and we have a lot of nostalgia and comfort with that,” she continued. “In other sectors, we’re way ahead in using technology to meet families’ needs. In education, we’re just starting to scratch the surface of that.”
The pandemic may have played a role in some companies joining the ranks of major ed tech players, according to Snell. She noted that Outschool, for instance, recently climbed nearly 60 spots among consumer spending rankings to become a major player in the market. Others include the Utah-based company Instructure, developer of Canvas, which is one of the most widely used learning management systems in U.S. public schools.
“MasterClass, Course Hero, Varsity Tutors, Skillshare — the whole sector saw these really big jumps on the list into the top 50,” she said. “I think it’s telling that actual consumer spending is supporting the trend that online education is the future.”
Jonathan Fry, higher education business lead at consulting firm Accenture, believes much of the recent growth of learning platform companies has to do with how K-12 schools are utilizing technology now compared to previous years. Fry noted that educators were using devices and programs such as Chromebooks, Google Classroom and Canvas before the pandemic, but as “supplemental” rather than central components of their teaching.
Fry said much of the focus on K-12 ed tech tools before now revolved around using the devices for homework and research purposes, rather than making them essential parts of a teacher’s toolkit.
“There was already a move toward digital tools and online learning, and that had been going on for a few years preceding the pandemic,” he said. “What’s happened was this proliferation of using collaboration tools like Zoom or Teams and others to help facilitate teaching.
“If you were in a classroom before the pandemic, kids in K-12 would get a Chromebook, but it wasn’t used from a learning standpoint,” he said. “It was pretty siloed, but [ed tech] wasn’t a driver or core capability that was used [widely] up until now.”
The pandemic has sparked more public discussion about the role public funds should play in efforts geared toward digital equity in education. Over the past year, states and local districts have poured billions into purchasing devices and Internet connectivity for millions of students through federal relief funds awarded to school districts. President Joe Biden also recently approved a stimulus bill that expanded Federal Communications Commission funding for student broadband access by more than $7 billion.
Still, Snell said, public subsidies play a smaller role in the market than some might imagine.
“Right now, it’s a tiny number of public funds that actually do this,” she noted.
However, the ed tech market could receive a major boost from pending legislation, such as the Affordable Broadband Act, reintroduced March 11 by House Majority Whip James Clyburn, D-S.C., and Senate Broadband Caucus co-chair Amy Klobuchar, D-Minn., to provide over $90 billion in funding aimed at expanding broadband infrastructure and adoption in underserved communities.
Snell said she’s seen citizens increasingly demand public funds for ed tech and infrastructure. Fry said this could create more incentives for private companies to branch out into underserved communities.
“In the United States alone, we spend [about] $800 billion on public schools, and the majority of that is still going to school districts’ traditional infrastructure and ways of funding students. At the margins, we see all these school districts that plan on keeping an online option separate from their traditional district full-time [options]. There’s opportunity there,” Snell said. “There’s going to be a growth in public policy, which is usually a lagging indicator of where people are at ... I think equity concerns are going to push that.”
Herb Thompson, senior strategist at software company VMware, said higher education ed tech investments were growing before the pandemic and will likely continue to increase following the public health crisis. And now that many public schools plan to expand online learning options following the pandemic, Thompson and Fry said those looking closely at the market don’t expect it to plateau anytime soon.
“When the pandemic ends, what will remain is the demand for hybrid curriculums with the ability to combine university experience along with the dynamic flexibility to learn when and where the student wants,” Thompson said in an email to Government Technology.
Thompson said the primary demand among schools is devices and platforms that enable collaboration and student support, but there’s also growing interest in ed tech tools that utilize artificial intelligence, which could be used for communication and for classroom functions like exams.
“AI and machine learning skills-based exams will drive a change in curriculum development, and AI/ML-based test creation and test assessments will drive the curriculum change,” Thompson said. “The most in-demand are and will continue to be remote learning environments, hybrid classroom collaboration tools, student-centered support systems and curriculum skills-based tools.”
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