Hello! Thanks for your question about the policy and regulatory issues that are expected to affect the EdTech space in the next 3-5 years including broad-based curricular changes like Common Core. The short version is that EdTech is expanding rapidly throughout the world with China, India, and emerging markets playing an increasingly large role in the global market.
The EdTech policy space in the United States is currently in a state of "wait and see" as President Trump's administration launches policies. That said, EdTech companies should keep an eye on ESSA funding and implementation, state-level repeals of Common Core, and the implementation of the Department of Education's new Open Licensing law. Other policy considerations like internet access, net neutrality, political corruption, and privacy concerns will also shape the next 3-5 years in the U.S. EdTech market.
In Europe, privacy is the hot button issue with the passage of the General Data Protection Regulation (GDPR). Meanwhile China will be the country to watch over the next 3-5 years as significant government funding and aggressive EdTech companies create a wave of digitized education options that will be felt in the U.S. market. Finally, India and the African Continent are also worth tracking in the next 3-5 years as government involvement and local start-ups bring Ed-Tech into mobile-connected areas lacking in traditional education options. Below you will find a deep dive of my methodology and findings.
METHODOLOGY
As you mention Common Core in your question, I made the assumption that you are primarily interested in the United States and focused my research on the U.S. That said, I have also provided some international-level detail, as you did not explicitly limited your question to the U.S. market. Moreover, regulatory developments around privacy in Europe and the fast-paced expansion of EdTech in China, India, and emerging markets in Africa have direct and indirect implications for U.S. EdTech companies.
First, I searched EdTech industry reports, government sources, and reputable news sources for policy and regulatory projections through 2021. Many sources provided general information about future trends expected for the EdTech industry, rather than policy-specific projections. One reason for this is that while the EdTech industry continues to grow significantly, U.S. regulations are in a holding period as the Trump Administration develops its policies and budget. As you mentioned Common Core, I also delved into how it is projected to affect EdTech. During my search, I uncovered useful sources about other countries, which are included in later sections of my report. Due to your focus on the next 3-5 years, I prioritized sources written this year or late last year and searched specifically for projections and predictions.
FINDINGS
OVERVIEW OF EDTECH INDUSTRY & GLOBAL POLICY CONSIDERATIONS
Last year, EdTechXGlobal predicted that EdTech will reach $252 billion by 2020. Their report found that the global EdTech market will be largely influenced by the "global education expenditure market" or how much governments, private companies, and individuals will spend on education. Digitation of education is projected to be slower than the adoption of technology in other sectors, due to the "increased number of gate keepers" involved in the distribution and implementation of EdTech, namely governments, policymakers, districts, schools, and teachers.
So far, the US has led the pace of growth and trends in the EdTech industry, but both Europe and Asia are growing rapidly. With 90% of the global population in emerging markets, digital education is tracking with the expansion of mobile technologies in those areas. Population is a major global demographic and policy consideration; it is both an opportunity and a challenge to the EdTech sector to expand branding and products into new markets so that "individuals can access international recognized qualifications." Meanwhile, "extreme automation" in the workforce is challenging governments and companies to train workers in new skills, leading to a growing role for EdTech. In the U.S., the recent presidential election has had a large impact on regulatory projections for EdTech, and the Trump Presidency will heavily impact the next 3-5 years.
ALL EYES ON ESSA
In December 2015, with "significant bipartisan support," President Obama approved the "Every Student Succeeds Act (ESSA)" to replace "No Child Left Behind (NCLB)." The law is designed to provide more "flexibility to states and districts on how to use federal funds" and includes significant provisions for education technology. "ESSA encourages personalized and blended learning through high quality, specific professional development and by defining important edtech terms." It essentially creates more space for states and local districts to use a wide array of learning tools and providers as well as multiple ways to report student outcomes.
Although ESSA does structurally create space for states and districts to implement more EdTech strategies, in December 2016 Doug Mesecar argued in EdTech Digest that education funding will have the most important effect on the US educational system and EdTech. ESSA includes a new "Student Support and Academic Enrichment Grant program," authorized at $1.65 billion, that would support "effective use of EdTech by states and districts" to improve students' academic achievement. Almost $900 million was specifically authorized for EdTech strategies. ESSA also prioritized professional development for teachers, which could include digital strategies. At the end of 2016, experts predicted that such policy changes backed by "directed funding" and "professional development support" would support EdTech growth. However, in 2016, the House only approved $300 million of the total $1.65 billion for the Grant program and Congress seemed generally unwilling to fully fund ESSA's programs.
On one hand, the election of Donald Trump as President did cause some to wonder if he would loosen regulatory constraints on EdTech. On the other, it has quickly become apparent in his administration's Department of Education budget proposal that EdTech is not a high priority for him. The budget proposal requests eliminating $9 billion in overall U.S. education funding and provides no funding for the financial programs under ESSA. His proposal also "suggests a possible restructuring of the Office of Education Technology through a chart that moves the office under the authority of the Deputy Secretary" which would be a demotion of the Office's role. David David DeSchryver, "senior vice president at Whiteboard Advisors" has stated that to leave the Office of Education Technology out of the budget is a "a missed opportunity to promote local and district innovation” and that there is no strategy in the budget proposal for EdTech.
As the President's current budget proposal will be reviewed and edited by Congress, ESSA and how much attention and funding is allocated to EdTech is in a state of "wait and see." While EdTech companies can certainly move forward with developing products and States can continue to develop their own policies, significant federal budget cuts would still be "devastating" to schools and prevent them from buying "technology, software or subscriptions." For EdTech companies, "shrinking school budgets" means that they must demonstrate the efficacy of their products and developed "evidence-based practices and a track record of success." Dr. Jennifer House, "a former school administrator, and the current president of RedRock Reports" suggests that companies develop case studies quickly of how they have provided schools with solutions rather than hardware and map out how schools can meet requirements.
At this time, it is not possible to predict with certainty what will happen with the Federal budget, but ultimately, ESSA will shape the EdTech industry and school systems whether it receives appropriations or not. States, school districts, and EdTech companies would do well to move forward assuming that Federal political and financial will is not coming.
In the meantime, COSN and the Center for Digital Education have published an ESSA Handbook, which outlines how as a law ESSA remains relevant for States, Districts, and educators in implementing technology in schools. They argue that while the "new administration brings new priorities and potential funding changes, ESSA was passed with bipartisan support, and its underlying provisions and priorities should remain in place." As such, from now through 2020, States will likely be the main drivers of EdTech-related policies and regulatory frameworks, as they have been in the past.
COMMON CORE
Common Core is a set of "mathematics and English language arts/literacy" standards in the US for what students should have learned by the end of each grade level. 42 states plus the District of Columbia and four territories have adopted Common Core. Common Core is designed to create a common standard of learning for all K-12 students, but has been criticized for hamstringing teachers and hindering the learning process. Although Common Core increases regulation of teachers and curriculums through specific learning standards, such increased regulation may actually present an opportunity for EdTech companies by driving "technology upgrades at K-12 schools" and causing them to acquire more mobile devices. Moreover, EdTech companies can remain relevant under Common Core by providing innovative and appealing technologies that meet Common Core standards; teachers are turning to EdTech to have more ownership over how they teach Common Core and how they reach students. Essentially, for States that continue to have Common Core standards in the next 3-5 years, EdTech companies would be smart to incorporate the standards into their technologies to make them appealing to schools and teachers.
Looking forward, President Trump has repeatedly criticized Common Core and in February 2017 signed an Executive Order repealing it. However, in practice Common Core is not a Federal initiative, but is controlled by states who choose whether or not to adopt it. As such, whether EdTech will be affected by Common Core in the future depends on which states choose to stick with it versus repealing. So far, Indiana, South Carolina, and Oklahoma have dropped Common Core and around 12 more states are considering repealing it due to teachers' frustration with the standards, increased testing, "awkward objectives," and what is viewed as Federal intrusion into State education policy. In the next 3-5 years, with more states questioning Common Core and Presidential aversion to it, the standards may disappear in more parts of the US.
OPEN LICENSING REQUIREMENTS
In late 2016, the US Department of Education adopted a new "open licensing rule" that EdTech companies that develop technologies using Federal grant money must make such technologies open for public use and "openly license copyrightable deliverables produced in whole or in part with ED funds." This rule was designed to "expand access to educational resources" and prevent companies from not sharing technologies with the public when they were sponsored with public money. The Department of Education has already begun incorporating the opening licensing rule into its grant programs and projects full implementation by 2018. So far, this rule "does not seem to be among those targeted for review and repeal under the Congressional Review Act, which allows Congress to rescind new regulations issued in the waning days of a presidential administration," so is moving forward and will be in affect for the foreseeable future. For EdTech companies, this means that any otherwise copyrightable work developed using Department of Education funds will be in the public domain.
MORE OVER-ARCHING POLICY TRENDS
In her annual review on EdTech, Audrey Watters predicts that EdTech will be affected by over-arching policy trends in America. She argues that the Trump Presidency poses a threat to access to the internet and net neutrality, which would be of considerable concern to EdTech providers. Moreover, political corruption influences how education policy is made and what education resources are prioritized. At the very least, she predicts that Trump era will be characterized by more "backroom deals and deregulation" and that EdTech companies will have to find ways to benefit from that. EdTech will also be key in policies to train the modern workforce and meet Trump's imperative to support US labor. Meanwhile, increasingly strict policies against undocumented immigrants and DREAMers will increase the demand for online education options.
Another overarching policy trend is the increasing focus on privacy and the protection of sensitive client data. Recently privacy concerns have become a significant trend in EdTech following revelations of tech companies using client and student data without permission. To date, 15 states have passed 28 total data privacy laws regarding student data. It is likely that regulations will continue to grow in this area as people across political lines are highly concerned about student data privacy. In the next 3-5 years, privacy and building trust with clients will be a major focus of EdTech companies for business and legal reasons.
INTERNATIONAL CONSIDERATIONS
EUROPE
Privacy has also been a major focus in Europe with the passage of "the General Data Protection Regulation (GDPR)" which will be in effect as of May 2018. It creates a regulatory framework of "new data protection rights for EU citizens." This new privacy law will significantly affect higher education and EdTech companies, as "non-compliant universities could be fined as much as €20 million or 4% of global annual turnover." Schools and EdTech companies must ensure they are compliant by May 2018 before the regulation comes into effect. "Under the GDPR it will be illegal to not have a formal contract or Service Level Agreement (SLA) in place with your chosen IT partner" or to work with an IT partner that is not accredited. At the same, there is huge potential for EdTech in Europe, as governments are actively trying to expand digital resources over the upcoming years to more of their populations to allow people to access technical education online. For example, the UK has developed a specific digital strategy to increase the use of technology in education.
OUTSIDE THE WESTERN WORLD
While the US and Europe have been leading in EdTech, in the next 3-5 years the industry will increasingly shift to Asia and Africa. "By 2100, more than half the world’s population will live in India, China, or Africa." This means that the global education market and policy realm will be "shaped less by issues and needs in the U.S., and more by the issues and needs of Africa, South Asia, and China.”
CHINA
In China, while there is tight government control over public education, private, after-school, and English language programs are not so tightly regulated and are increasingly dominated by EdTech companies. From 2013-2015, EdTech investments in China "grew from $137 million to $1300 million" and are projected to keep increasing. Meanwhile, the Chinese Ministry of Education recently drafted a ten year plan that allocates 10% of the annual education budget to digitized education digitization (around $23.5 billion). Chinese EdTech companies are becoming so successful in teaching students through interactive videos that they are actively looking to expand into US markets. US EdTech companies may soon find more Chinese players in the American market. In fact, Chinese companies are coming to the US to both learn from American EdTech models and to acquire EdTech companies. While US funding for EdTech through ESSA may be stagnating, China's regulatory and financial investments into EdTech is not only growing but will make waves in the US in the upcoming years.
INDIA
In India, the mainly unstructured market presents a huge opportunity for EdTech solutions that can reach poor students. India has more than 250 million students, but the quality of public education is low. Increased access to tablets and smartphones is gradually spreading internet through poor neighborhoods along with education options. While in the past Western-led EdTech attempts in India were not all that successful, now India-based start-ups are leading the charge with greater understanding of local market needs. Previously, education was heavily controlled by schools and the "physical location of teachers" but now technology is opening up more options for learning. At the same time, the government is now actively "engaging the private sector" in universalizing education for elementary school children. So far, the government has stepped in with support rather than regulation, which is creating a lucrative and impactful environment in India.
AFRICA
The story on the African Continent is relatively similar to India in that the increased use of mobile phones is creating greater access to the internet and consequently EdTech options. However, currently there is an anti-technology mindset among teachers and parents who view mobile phones in classrooms as disruptive. Moreover, internet penetration remains low at 29%. In the upcoming years African governments will likely play a big role in infrastructure development and increasing access to internet across Africa. As long as governments then "stay out of the way" in how technology is used in classrooms, expert Jamie Martin predicts that there will be a surge in EdTech in Africa. As such EdTech companies working in Africa should look to support government attempts to increase internet access along with gaining teacher and parent trust.
POSSIBLE CONTINUED RESEARCH
As US States have considerable influence over EdTech policy and state/local regulation, you may be interested in more focused research into specific states and/or local jurisdictions. You may also be interested in delving more into the EdTech industry in specific countries or regions. Such questions could be phrased as:
What policy/regulatory issues are expected to affect the EdTech space in STATE/COUNTRY/REGION NAME in the next 3-5 years?
What influence do local jurisdictions in STATE/COUNTRY NAME have over regulating EdTech?
Worth noting, I found China's EdTech market and related incursions into the U.S. market extremely interesting and important to include, because I currently live in China as an America ex-pat. I have noticed firsthand the huge expansion of EdTech options in the country as well as talked with Chinese companies looking to expand their models into the U.S. market. You may want to delve into that topic further through a follow-up research question:
Please provide an overview of the Chinese Ed-Tech market and how Chinese companies are looking to incorporate and acquire U.S. EdTech models.
CONCLUSION
To wrap it up, in the next 3-5 years the EdTech space in the U.S. will be shaped by President Trump's education policies, Congress' appropriations, and the roles of States in implementing ESSA and Common Core. The new open licensing law will also affect EdTech companies seeking Federal grants. Policy considerations around internet access, net neutrality, political corruption, workforce changes, immigration, and privacy will all loom large for EdTech over the next 3-5 years. Meanwhile, privacy will be the chief concern in Europe along with the positive trend of governments investing in EdTech legislatively and financially. It will also be worth keeping an eye on China, India, and emerging markets in African countries. China's expansion into EdTech will be felt in the U.S. as Chinese companies seek to learn from and acquire U.S. EdTech companies.
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