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Technology changes the way school districts buy digital resources
The move toward personalized learning and the ability to deliver resources via the cloud are transforming the way districts purchase digital content for math, reading and other parts of the curriculum. As this landscape changes, district also are spending more on digital resources.
“We are consciously moving a lot of educational software to web-based, subscription-based tools,” says John David Son, director of instructional technology at the Naperville school district in Illinois. “When you think about educational software, it’s important to think about the opportunity for students to personalize their own learning—and they need to be able to access it regardless of device, location or time of day. Web-based software gives us that flexibility.”
Naperville’s budget increases about 2 to 3 percent annually, and the district spends about $350,000 each year on digital learning resources, says Son.
Based on survey data from the 2011-12 school year, the Software & Information Industry Association (SIIA) estimates that revenue from digital content for instruction grew almost 20 percent, with upswings in every area except reading/ELA—which still dominates the market for online instructional resources.
“Districts are slowly but steadily spending more budget dollars for digital learning resources,” says Karen Billings, vice president for SIIA’s education division. “Overall budgets are not increasing, so we surmise that districts are purchasing fewer print materials.”
The amount districts spend on a digital resource per pupil can be as high as $60 a student, although materials are mostly in the $4 to $8 range, says Farimah Schuerman, managing partner of Academic Business Advisors LLC, a consulting firm that provides services to education industry companies.
Protecting student data
Ed tech providers collect massive amounts of information about students through online platforms, mobile applications and cloud computing.
Districts must therefore be vigilant about keeping the information out of the hands of non-educational commercial interests and other third parties.
“Districts need to know their vendors’ student data privacy and security policies. How vendors treat the student data that may be acquired from use of the software has become more important over the last year,” says Karen Billings, vice president of the education division at Software & Information Industry Association.
Most vendors are sensitive to the issue and are eager to comply with district policies and the Family Educational Rights and Privacy Act (FERPA), Billings adds.
Many vendors post policies on their websites or embed them in applications, says Mike Lorion, Common Sense Media’s vice president and general manager of education.
The organization’s School Privacy Zone campaign is led by a panel of chief information officers and chief technology officers from the biggest districts in the country, representing nearly 3 million students. Privacy, safety and consumerism are among the key issues the panel is investigating.
“Districts really want to know how they can make sure they are holding student data in the proper way,” says Lorion. “Developers care about these issues, too, and want to create ed tech that districts can use and trust.”
The panel met in June and plans over the next year to develop a process for districts to vet products for privacy. Common Sense Media will then provide privacy ratings in its product reviews.
The comprehensiveness of the solution is a key factor in pricing. A core math program that provides deep instruction on the fundamentals for elementary grades and covers a full curriculum will cost more per student than a game-based math app that addresses a particular learning challenge, such as fractions or decimals. “The price varies a lot, depending on the audience and the materials,” Schuerman says.
Three factors are driving the increase in purchasing digital content:
- Browser-based materials that support personalized learning with varied modes of instruction and 24/7 availability
- Availability—more devices are available today to access the software
- Software can be accessed via vendors’ servers, avoiding the need for expensive and time-intensive infrastructures
Districts always need to consider the availability of broadband internet access in their region before licensing a cloud-based solution, says Michael Chai, Pearson’s senior vice president of school product technology. “Losing connectivity even for a minute gets in the way of learning.”
For example, Iowa City School District opts for the cloud whenever possible. “The advantage of cloud hosting is we don’t need as much staff to manage it,” says David Dude, the chief operating officer and chief technology officer.
“Some of the systems are pretty complex, and it’s nice to have the vendors be the experts,” Dude adds. “We don’t have to worry about the details of how their system works.”
However, Iowa City hosts solutions that require a lot of bandwidth—like those with video—at the district level or with a hybrid model. For example, an educational product that has occasional high definition video might have all of the text served from the district’s central data center. But when a student clicks on a video, it might be delivered from a server in the school building.
“This way, we take bandwidth to copy the video to the replication server only one time.” says Dude. “Then the actual streaming of the video is confined within the school’s local network.”
Vendor models
The move to the cloud has pushed vendors to change their pricing models. In the past, the cost of software was usually based on the number of machines it was installed on. Some specialized vendor solutions—such as career and technology courses—are still sold that way.
But the most common arrangement by far is an annual charge for each student accessing the software in the cloud. “Subscriptions are the modern-day equivalent of software licensing,” Billings says.
Pearson’s fee arrangements vary based on a district’s budget process or are tied to the rate of growth of the student population. For example, in some districts or states, instructional materials are a capital expense and need to be paid for in a lump sum.
A rapidly growing district might be better served by a subscription model that has a variable range for number of students. This way, a district will have a clear picture of its monthly and annual expenses. “We work with thousands of schools and districts with a variety of unique needs and we use the model that works best for them,” Chai says.
Another model still in limited use is pricing software based on the number of buildings in which it is installed. “Some schools have 2,000 students and others only 150, but we pay the same amount,” Dude says.
School Improvement Network offers districts a range of options, from per-student licenses to per-school or even per-teacher licenses. The most common plan is assigning a license to every user. All of the company’s products are available in the cloud.
Most vendors are flexible about adjusting fees or transferring subscriptions when a student leaves mid-year. Billings says open education resources and 99-cent apps have driven down costs and forced vendors to repackage their offerings.
“A vendor might set a price for just one part of a comprehensive premium program. That gives teachers the flexibility to see if it’s viable before they pay for more features and benefits,” Billings says.
And what about all those free apps? “From our experience, free doesn’t always mean free,” Son says. “They don’t come with any support or access when you need training materials or when parents have questions about the software. The costs come in other places.”
Kecia Ray, executive director of learning technology at Metropolitan Nashville Public Schools, says many district leaders no longer ask all of their educators to use the same software.
“We are coming upon a shift in the way that school districts and vendors develop their partnerships, and it’s very exciting,” says Ray, who also is board chair for ISTE. Selection criteria
Of course, the most important factor when evaluating software is whether the product supports instructional goals. “Our process starts with our content experts,” Son says. “They evaluate it from an instructional standpoint and whether it aligns with Common Core State Standards.”
The next steps are to determine the tech support required and the costs, including hardware, software, vendor maintenance and data centers—which come with their own expenses, such as electricity, cooling, upkeep and staffing.
“Some of these expenses are shared with other needs, so we prorate accordingly,” says Dude. “If the vendor is hosting it, we need to determine whether there are any challenges with accessing it.”
Among these challenges are configuring filter and firewall settings, ensuring adequate bandwidth and making sure the vendor is available to troubleshoot problems.
“It’s a curriculum decision first, but it’s the IT area that has to make sure it works,” Dude says.
The “perfect scenario” is to have an academic/instructional administrator team up with an IT colleague to review a product, Ray says. “As long as you have that congruency, you can be very successful in making the right decisions on behalf of your school.”
Pricing factors
John Campbell, CEO of Cambium Learning Group, says price is impacted by many factors, including the number of students served; perpetual license vs. subscription; single-year license vs. multi-year; and the support and training included.
Some districts bundle hardware and curriculum content into one bid to gain savings, says Pearson’s Chai.
And Ray adds that Nashville Public Schools gets better pricing when it enters licensing agreements of two to three years. The district also checks with regional consortia for pricing discounts.
More district leaders require that software integrates with their learning management system (LMS). This way, students and teachers are presented with the resources when they log in to the LMS and are more likely to use the products.
Jim McClafferty, president of Brain Parade, suggests district CIOs ask certain questions of prospective vendors:
- What support will the vendor provide?
- What planned enhancements are expected in the product?
- Are multi-year commitments and discounts offered?
- How many other customers does the vendor work with?
- Does the vendor have local resources?
The reason to ask about enhancements is to determine whether updates will cost money and if a vendor will invest in a product or devote resources elsewhere, says McClafferty.
A vendor with lots of customers is likely to be a long-term player. But district leaders must ensure that the vendor also has the capacity to provide adequate tech support. A smaller vendor with fewer customers may be able to give a district more attention, but may only be in business short-term, McClafferty says.
Vendors with local resources may be able to provide additional opportunities. For example, because of low travel costs, a vendor might share a new product with a district that is close by, he says.
When buying licenses or subscriptions, districts must try to estimate the number of students and educators who will use the software, says Bill Odell, vice president of marketing for Dell KACE K1000 Systems Management Appliance, which inventories all software on a district’s network.
Violating a licensing agreement can be costly, Odell says. Every $1 spent on a software license means $3 in penalties. “[But] you don’t want to pay for licenses you are not using,” Odell says. “Sometimes districts get so fearful about being out of compliance, they overbuy.”
To Learn More
- Software & Information Industry Association pledge to safeguard student privacy
- Common Sense Media School Privacy Zone
- Data Quality Campaign
Resources