Massive open online courses (MOOCs) attract tens of thousands of learners which in turn have attracted millions of dollars in venture capital despite the absence of a clear business model that provides evidence of a venture’s revenue generating potential and despite the fact that courses are non-credit. Coursera and Udacity, both founded by Stanford University professors along with EdX, a nonprofit funded by Harvard University and Massachusetts Institute of Technology are the top three MOOC providers. Both Coursera and Udacity have attempted generating revenue through job referral services while the latter also offers sponsored courses. Udacity and EdX partnered with Pearson VUE to offer fee-based proctored exams. Results have not been promising because fewer than 10% actually complete a course and even fewer are willing to pay to take the exam or become qualified for a job referral. Content licensing is another revenue model being considered, however tuition-paying students of licensed institutions that incorporate MOOC content into their curricula will expect to earn credit toward their degrees.
Korn, M. & Levitz, J. (2013, January 01). Online courses look for a business model – free classes, open to the masses, seek to generate revenue from content licensing, exams or job-referral services. The Wall Street Journal, p. B8.