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Blackboard’s identity crisis, Desire2Learn’s optimism, and Instructure’s coolness

Since Blackboard announced its acquisition of several Moodle partners, numerous voices have chimed in to explore what it means to education. In particular, Michael Fieldstein (as usual) has a wide ranging and thoughtful response: What the heck happened? and Phil Hill captures the tone/responses from major players.

A common response to the longterm impact of these acquisitions has been to link Blackboard’s manoeuvre with the IBM’s transformation into a services company. This comparison is particularly silly because IBM was heavily invested in a hardware field that was being commoditized, whereas Blackboard is a software company (i.e. Microsoft). And the LMS is not being commoditized – it’s being integrated with new value adds including curriculum, eportfolios, analytics, learner relationship management, advising, mobile, etc. The IBM model of transformation may be a goal of Blackboard, but the demand side of the equation does not yet exist for Bb. Michael Fieldstein quotes Ray Henderson as saying “50% of the company’s revenues are now from sources other than LMS licensing, “and it’s going to get larger.””. My first thought is that it’s likely not revenue growth in new offerings that drives that number, but a collapse in LMS licensing.

Blackboard has a history of not knowing what it is. Or the type of market in which it operates. Signal Hill’s Trace Urdan, in an investment report, stated that Bb is “a shark in waters that aren’t used to seeing sharks” (i.e. higher education market). (OT: Trace is hands down the best investment strategist/advisor in edtech. He used to do a monthly newsletter, but that appears to have been discontinued. I’ve tried a few times to connect with him to deliver a presentation on his work and how he sees the higher ed tech market, but no luck).

Blackboard’s legal moves rank as one of the most significant missteps that I’ve seen by an education company. The name Bb evokes almost unanimous snickers/vitriol/disgust, largely based on their patent lawsuits. Bb is the most hated company in education (I briefly tackled their reputation here). A few folks that I respect greatly have recently softened in their disdain for Bb and are willing to give them a chance. I personally have never had a hugely negative or positive view of Bb. Their move to synchronous tools, their tactics of buying competing company to eliminate competition (Elluminate and Wimba), acquisitions of iStrategy, etc., are sound business strategies. (Disclaimer: They have been generous in allowing us to continue using their Collaborate tool (formerly Elluminate) for open online courses).

Back to the main point: Bb has identity issues. They badly misjudged the reaction of the education community to their patents suits. They were no longer content to be an LMS provider and broadened their product line (good idea – Elluminate/iStrategy). Now they have decided to become a service layer for education (i.e. consultancy of sorts – PwC/Deloitte).

What confuses me is that I’m confused.

I don’t know where Bb is going and what target they are pursuing in the education space. Private companies have the benefit of not revealing their plays. Bb is at a precarious point and is making a significant gamble: they don’t want to be an LMS provider, they want to a services company. The problem, of course, is that higher education has not yet signaled, broadly, that they need or want this. From my discussions with university presidents and senior admin, their most significant concerns rest around content, reputation, curriculum, international partnerships, etc. Does Bb want to play a consultancy role of this type? If so, they need to really ramp up their capacity, especially since universities like to do knowledge-type things themselves.

Ok, let’s leave Bb.

What’s left in the LMS space? I see two primary companies: Desire2Learn and (based on momentum) Instructure. I’ve left out Moodle mainly because their deployments are smaller-scale. Instructure states “We rarely see Moodle or Sakai make it to the short list of any education institution.” With several university LMS selections that I’ve been involved with, Moodle is not a contender. Plus, purely anecdotally, Moodle has been tainted by their lovefest with Bb.

Desire2Learn

I’ve met John Baker (CEO) on several occasions and was a keynote at their annual conference in Memphis (disclaimer: Desire2Learn is a sponsor of the LAK11 and LAK12 conference) and have had numerous interactions with company over the past six years. There was a time – peak of Bb lawsuit – where both John and D2L seemed somewhat troubled (stressed?). Obviously their future was uncertain. As the lawsuit headaches cleared, D2L has been making tremendous progress. They’re poaching numerous Bb clients and succeeding in numerous systems-wide and state-level deployments. They’ve continued to flesh out their product line: eportfolios, design wizards, mobile, etc. They have a very loyal customer base. Instead of growing through acquisition (Bb’s model), D2L has grown through internal R&D which has produced an integrated product line with strong end-user satisfaction.

Last week, I visited D2L’s main offices in Kitchener as part of a possible research project in analytics. The mood or feel of the company can be described in one word: optimism. They are an organization that knows what/who they are (an LMS vendor) and have not wandered from their mission since they started. Apparently, they’ll be at about 500 employees by year end. Tony Bates states that LMS are here to stay and D2L’s success through being focused on that market supports his assertion.

Instructure

Instructure is a new player in the LMS market with the “purpose of disrupting the Learning Management System (LMS) market by setting a new, open standard for education technology”. I don’t know their product well and they’re still a small company. It may be premature to lump them in with Bb and D2L. However, Instructure has a certain coolness factor.

They are Google to Microsoft (Bb, but I didn’t really have to spell that out, did I?): designed for the cloud, using openness as a lever, and VC-backed.

And they do the odd cool thing like giving DS106 $5000 to continue their work. (btw, Instructure, if you’re really in a mood for something new, why not work with Stephen Downes and me in building the technical platform for MOOCs? We have ideas, but need good programmers!).

The LMS space is a bit uncertain now, reflective of the education field as a whole. The change pressures are enormous: edtech startups, OERs, globalization, public divestment of educational support, new university models (Udacity, Minvera), and west to east and north to south capital and economic shifts.

Bb has embarked on a bold strategy, one that will essentially see it exit the LMS market. It’s risky. Very risky. Education may be ready for this type of player, but I haven’t seen it in my interactions with leaders and educators.

Desire2Learn and Instructure don’t generate the confusion in end users that Bb does today. D2L is clear: we are an LMS company and we offer value adds to this core product. Instructure has brashness on their side and as their creed: we’re cloud and open.

It will be an interesting few years for the LMS as the higher education market begins to acclimate to dramatic change pressures.

16 Comments

  1. So now you are going to join Instructure with the weird comments on Moodle? Every single college I have worked with on LMS selection has Moodle on the short list. Every single conference I go to, Moodle is every where. Everyone is considering it. I still have a hard time finding people who know what Instructure is. I don’t know enough about Instructure to love it or hate it, but I just don’t get this weird talk about Moodle. Last year we were all reading articles that listed which colleges had chosen Moodle or Blackboard in a head-to-head competition (both Bb and Moodle fans posted their versions of these lists)… and suddenly we want to act like Moodle is not a contender? That just seems to be totally inaccurate to me.

    Friday, April 6, 2012 at 12:50 pm | Permalink
  2. Tony wrote:

    “I’ve left out Moodle mainly because their deployments are smaller-scale.”

    I respectfully disagree:

    http://docs.moodle.org/22/en/Large_installations

    WRT Instructure, it’s basically the Blackboard pedagogical/organizational model with a few flashy gadgets on top.

    However, I’m not a fan of Moodle 2.0 — it’s a perfect example of Second-system Effect.

    Friday, April 6, 2012 at 1:29 pm | Permalink
  3. gsiemens wrote:

    @Matt – my Moodle comments didn’t come out as clearly as they should have. Michael has posted market share by LMS here: http://mfeldstein.com/the-blackboard-announcements-part-1-what-the-heck-happened/#more-3164. Obviously Moodle is a significant player. And, as I noted in my comments, I was commenting based on my experiences with U of M and RRC. Obviously there are some large moodle installs (OU). I just haven’t seen them as a significant system player…but more as smaller installs.

    Tony – thanks for the link. In terms of Instructure, I’m not that familiar with the company (as noted). They do have a fair bit of momentum and are able to generate some excitement.

    Friday, April 6, 2012 at 6:25 pm | Permalink
  4. Mark Ingham wrote:

    At the University of Greenwich (London UK) we have, after an extensive tendering process, chosen Moodle as our VLE. The University of the Arts, London has also recently decided to move from Blackboard to Moodle. Having been a user of both systems I have found Moodle to be far easier to use and a much more affective learning envoronment than any other I have tried. My impression is that it is becoming the VLE of choice for many UK universities. I hope the debates continue so we can have the best learning environment for all of our students.

    Saturday, April 7, 2012 at 2:50 am | Permalink
  5. These prognostications are amusing nonsense. Blackboard isn’t exiting the LMS market or thinking of these solutions as commodities. Thanks for motivational material to put up in dev standup meetings. Skeptics should come to BbWorld in July and see for themselves.

    Saturday, April 7, 2012 at 9:38 am | Permalink
  6. Rob Reynolds wrote:

    George, to me the most important statement here is this:

    “Does Bb want to play a consultancy role of this type? If so, they need to really ramp up their capacity, especially since universities like to do knowledge-type things themselves.”

    This is actually a problem with a whole range of educational technology platforms being developed “outside” the institution or outside of traditional educational technology channels. Moving beyond providing a straightforward technology product proposition to offering a true educational service that impacts student outcomes and pedagogy requires a much different workforce and set of relationships. This is a challenge for Blackboard and for major publishing companies that are building out integrated technology solutions that can be marketed to help measure student outcomes against institutional learning objectives.

    Saturday, April 7, 2012 at 9:38 am | Permalink
  7. Reuben Charis wrote:

    Moodle is small scale like Open University (600,000 students), UCLA, 10 of the 23 campuses of the 450,000 student Cal State system? Really? Come on its not like this stuff is hard to find out, http://moodle.org/stats shows 58 million students at 67,000 registered sites. D2L would love to be as small scale as Moodle.

    Instructure has what, 1 major deployment? That has just started? And they are a major player. Probably Blackboard is planning to buy them for 80 million dollars.

    Didn’t Instructure once claim that releasing Canvas as open source would be the ‘poison pill’ that prevents Blackboard from buying them?

    Saturday, April 7, 2012 at 11:19 am | Permalink
  8. @John – can you provide more detail on what is amusing nonsense?

    I don’t think I was being unfair to Bb in my post – I was drawing largely from Ray Henderson’s comments, i.e. “our strategic shift towards a focus on the full student lifecycle rather than the LMS niche”. Bb is moving beyond the LMS. They are becoming a services company: “Rather than another LMS-oriented company, it gets a firm focused on helping institutions to solve the hardest problems in education, comprehensively.”

    Glad to have helped you with your dev meetings, tho!

    Saturday, April 7, 2012 at 11:21 am | Permalink
  9. @Rob – agree. It is a bold step for Bb…one that will likely be needed in the future. Timing, however, is everything. Bb has moved into the domain of consultancy companies, publishing companies, etc. I’m not sure the market is ready, or asking, for this today.

    Saturday, April 7, 2012 at 11:24 am | Permalink
  10. @Reuben – as I noted in my response to Matt, Moodle has a huge install base (i.e. Fieldstein’s post), but many of those installs are small schools/colleges. A few systems are quite large (OU only has 250k learners: https://en.wikipedia.org/wiki/Open_University). I don’t have stats and I prefaced my comments as being anecdotal…but I would imagine Moodle has smaller per-install numbers than other LMS providers. It’s like Twitter: millions have accounts, a fraction get used.

    In terms of Instructure – I acknowledged that they were small and likely shouldn’t be grouped in with D2L and Bb. I was mainly impressed with their willingness to engage and support innovative activities like DS106

    Saturday, April 7, 2012 at 11:34 am | Permalink
  11. I don’t mean to accuse you of being unfair to Blackboard. I only dispute the notion that Blackboard is pulling back or will pull back from the LMS market as a result of this move.
    I think you are probably misreading Ray’s comments and the intent. In the same post Ray also stated that Learn remains Blackboard’s flagship product and talked about its renesiance.
    To catch up on Blackboard Learn’s ongoing development visit CourseSites and create a free account at https://www.coursesites.com this service is kept in sync with the most recent public release of Learn and often previews future functionality in Learn.

    Saturday, April 7, 2012 at 4:43 pm | Permalink
  12. Geoff Cain wrote:

    You might want to take a second look at Sakai – there are a lot of institutions using or moving to it: http://sakaiproject.org/organization-list

    There is also rSmart – a MoodleRooms-like support company for Sakai (although I hope I don’t curse them by mentioning “MoodleRooms” in this response).

    Monday, April 9, 2012 at 4:06 pm | Permalink
  13. Reuben Charis wrote:

    10 Largest Moodle sites:
    Site|Users|Courses
    Moodle.org|1,158,925|65
    LMS Moodle – SENA SOFIA Plus|1,149,319|40,455
    OU online|840,664|7,021
    Hocmai.vn – Ngôi trường chung của học trò Việt|573,752|132
    EAD – Rede de Formação Profissional Orientada pelo Mercado – Secretaria de Estado de Ciência, Tecnologia e Ensino Superior – Governo de Minas Gerais.|482,601|24
    MyLinE – Online Resources for Learning in English|462,238|90
    Anhanguera Educacional – Oficinas de Apoio e Aprendizagem|312,909|7
    Competências Transversais|291,037|6
    Christian Courses e-Learning|234,119|116
    SBCC Online College|228,706|5,176

    Moodle is Martin’s PHD project, after all, so data is important. Every Moodle site has a ‘register’ button that sends anonymised data on the the number of users and courses (only if that button is pushed). There are many sites that have not sent data of course, but the 10 largest sites that have are available here: http://moodle.org/stats

    They range from ~1.1 million users to ~228,000. This data is pulled from the Moodle site’s database. OU’s Wikipedia page may be out of date.

    Tuesday, April 10, 2012 at 6:12 am | Permalink
  14. As others have pointed out your comments about Moodle deployments are a bit off the mark. Also Moodle caters for a wider sector base than the other LMS.

    However on being confused on where BB is going etc, I have added a post about my overall thoughts on the BB move to acquire two Moodle partners.

    http://www.somerandomthoughts.com/blog/2012/04/12/some-thoughts-on-the-acquisition-of-two-moodle-partners-by-blackboard/

    From my perspective I think as the learning eco-system has moved (and is moving) outside of the walls of the LMS through being more social, more integrated into the PLN of the learner, the value added services and products around the LMS are going to be the new battleground.

    This is where I see IMS LTI enabling more niche learning tools and activities to be successful without having to build themselves inside any LMS. The requirement for being usable by any and all is easier now that all major LMS support LTI.

    Just my 2 cents.

    Thursday, April 12, 2012 at 3:45 pm | Permalink
  15. Norman Rhodes wrote:

    Speaking of sharks, it seems that Bb now has another larger one following in its path – Facebook. They have decided that the water is warm and they want to make it warmer with an offering of their own, ‘Facebook for Schools’. File sharing, calendars, collaborative forums and the rest that they probably haven’t decided to talk about yet.

    Friday, April 13, 2012 at 7:03 am | Permalink
  16. Rahim wrote:

    I just sat in a presentation and discussion delivered at Cal State University Dominguez Hills on this very subject (i.e. the future of the LMS). There was an interesting chart shared about LMS installations across the 23 campus California State University system: a downward trend for Blackboard, an upward trend for Moodle, and a flattening and steady lower trend for D2L. What if the truth is much more banal and the reason that Bb bought Moodlerooms is simply to get a piece of the momentum as institutions switch out from Bb to Moodle? What intrigues me about the acquisition of Moodlerooms is how (going forward) they will interact with the Moodle source code. There have been a number of deep engagements between Moodlerooms and Moodle historically, so not clear if that type of cooperation continues unabated or if there’s a change…

    Tuesday, April 17, 2012 at 5:04 pm | Permalink