Online learning companies were dying — until COVID-19 hit. Millions who lost their jobs are flocking to virtual classrooms to learn new skills, and platforms are watching their profits rise.

  • Online learning platforms were the subject of plenty of hype in the 2010s — the New York Times predicted 2012 would be "the year of the massive open online course" — but one-by-one, they fizzled out, and were slowly dying.
  • The coronavirus crisis has helped them rebound. Millions of people who are unemployed or furloughed have turned to online learning for new skills during the COVID-19 pandemic.
  • Enrollments are up, and more people are completing their courses. COVID-19 looks to have changed the sector permanently. 
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Shana Sanford moved to Orange County, California for a fresh start in March. A decade after she struggled to find work in the wake of the 2008 crisis, the law school dropout finally felt confident enough to leave a dead-end executive assistant job in Los Angeles and pursue her passion.

But two days before starting at a hotel marketing agency, her job offer was rescinded amid the chaos of coronavirus. She was, like millions of Americans, suddenly unemployed. 

"I can't believe I've got the short end of the stick twice," she says. "It's like, am I dreaming? Someone pinch me."  

Sanford enrolled in two coding classes with California-based online learning company Udemy. She's currently learning SQL and HTML, which will help her move from the travel sector to one that has thrived during the pandemic: technology. 

Online learning has had a good crisis. Enrolments have soared, the culmination of a turnaround that began years ago, after the networks failed to live up to early hype and were plagued by poor completion rates. Like Sanford, millions have sought to upskill as the coronavirus wreaks economic havoc and reminds us how fragile employment can be. One sector leader tells Business Insider the crisis will help bring the industry back from the brink of failure; the impact of COVID-19 on the sector, as in so many other areas of life, seems permanent.

Emerging a decade ago, these platforms put courses from the world's top universities online, for free. People flocked to them. The New York Times proclaimed 2012 "the year of the MOOC" — massive open online course. Coursera and Udacity, both for-profit companies in Silicon Valley, raised hundreds of millions of dollars from venture capitalists at lofty valuations. 

But research found only a fraction of students on edX, a not-for-profit organisation created by Harvard and MIT, actually completed a course. Solo students lacked motivation, and astronomical drop-out rates led to claims, even from providers themselves, that MOOCs were failing (then-Udacity vice president Clarissa Shen said in 2017 that MOOCs were "dead.") 

Read more… Remote university learning can be just as good as a physical classroom. I've been teaching 80 students, from Beijing to Illinois, online since June — here's how I've made it work.

"The hype was overblown," says Andrew Crisp, a UK-based education consultant. "Everybody thought MOOCs would disrupt higher education overnight. But so many young people want the campus experience and networking opportunities." 

Udemy's VP of learning, Shelley Osborne, argues that completion rates are an unfair benchmark to judge learning success because people shop around. "Completion rates are not a proxy for retaining knowledge," she says. Course ratings and surveys of whether learners achieved their aims are better measures, she adds.  

Yet in a tacit acknowledgement that MOOCs were unsustainable, the platforms moved away from free learning to paid-for certificate courses — and even fully-fledged degrees.

Udacity was founded in 2011 and just a year ago, the company was haemorrhaging cash.

It laid off much of its workforce and pivoted towards businesses that need to reskill their workforce in the era of automation. It is currently training 100,000 young people for Egypt's Information Technology Industry Development Agency, for example. Its courses, called "Nanodegrees", are created by companies including Facebook and Google and focus on in-demand skills such as AI and cyber security. 

They proved popular — 125,000 have been awarded in total — and are now even more so in lockdown. Profit from subscriptions grew 260% in the first half of 2020, and the company is now profitable for the first time. "This will be remembered as the year when online learning became mainstream," founder and executive chairman Sebastian Thrun says. "The coronavirus crisis is the perfect storm."

FutureLearn, a London-based online learning platform, has gained 3.4 million users since the UK's lockdown began in late March — a 34% rise. In the past three months, the completion rate has held above 30%, up from around 20% in the same period last year. The company's data show that people who complete one course are three times more likely to take a second and third. 

Coursera reported a 500% surge in enrolments since mid-March, compared to the same period last year. Anthony Tattersall, who oversees Coursera training for companies in Europe, the Middle East and Africa, says there has "never been a better time to upgrade skills as the urgency to revive jobs and economies becomes more pressing."

Udemy saw 25 million new enrolments in May, compared with nine million in May 2019.

In April alone, edX gained five million learners, as many as in all of 2019 — it now has 32 million users. It recently surveyed new users on their reasons for joining. It found 35% had more free time and wanted to learn something new, 25% wanted to learn more skills to pursue raises or promotions, 17% were students supplementing their education, disrupted by coronavirus, and 11% wanted to train for new work after losing their jobs or being furloughed.

When students have to pay for online learning, the vast majority complete their course. Anant Agarwal, edX's CEO, says that the completion rate for paid courses awarding certificates is 60%. "You don't measure the completion rates of people who are window shopping," he says. "We do it from who comes into the store."  

The coronavirus crisis boosted already strong adoption, he adds. "The seeds we sowed are bearing fruit."

The networks have developed a formula for successful online learning: coaching and mentoring, networking between students, and interactive assessments that put theory into practice. Coursera's Tattersall warns that "online platforms will only retain new consumers if their content is high quality, offers credentials and develops job-relevant skills."

Online learning is a lifeline for universities

This recipe was a lifeline for higher-education institutions that scrambled to move online when lockdown hit. In March, universities were granted free access to Coursera's online teaching platform. More than 4,100 institutions, with 1.3 million students, signed up. 

"This is a pivotal moment for online learning," says Ashwin Damera, co-founder of Singapore-based educational technology company Emeritus, which enrolled 75% more students in 2020's second quarter than the first.

Higher-education institutions were once sceptical, in part due to concerns about the quality of online teaching. Now that universities have to rely on online learning, they're more open to the idea, says Damera. "Online learning will explode in the years to come." 

An Emeritus survey in March of 785 Americans found that 73% were keen to pursue further education because of coronavirus, with 82% of them interested in online education, which is more flexible and cheaper than its classroom equivalent.

Sanford, who's learning coding through Udemy course, is a prime example of why flexible learning can work. Alongside her studies, she's landed freelance marketing work helping brands respond to the Black Lives Matter movement. Sanford, who is Black, is now developing an Udemy course on this subject to monetise her advice, joining the 57,000-odd instructors on the platform.

"I still want to pursue coding. But tech isn't going anywhere," she says. "I have that option and those skills in the bank."

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