UU - Universities and Unicorns: building digital assets in the higher education industry

Lead Research Organisation: Lancaster University
Department Name: Educational Research


The higher education (HE) sector has been marketised for decades; but the speed, scope, and extent of marketisation has led key education scholars to conceptualise it as a global industry (Verger, Lubienski, & Steiner-Khamsi, 2016). Further, the use of technology to transform teaching and learning, as well as the profound digitalisation of universities more broadly, has led universities to collect and process an unprecedented amount of digital data. Education technology (EdTech) companies have become one of the key players in the HE industry and the UK has made EdTech one of its key pillars in its recent international education strategy (HM Government, 2019). EdTech companies are reporting unprecedented growth. In 2019, Coursera became a 'unicorn' (i.e. a company worth over $1 billion), while British-based FutureLearn secured £50 million investment by selling 50% shares of the company. Investment in EdTech is growing at an impressive rate and reached $16.3bn in 2018 (ET, 2019). While EdTech start-up companies strive to become 'unicorns' and profit from HE, so too might universities increasingly look for new ways of profiting from the wealth of digital data they produce.

The study of HE markets has so far focused on service-commodities. However, data and data products do not act like commodities. Commodities are consumed once used, but data is reproducible at almost zero marginal cost. New products and services can be created from data and monetised through subscription fees, an app, or a platform that does not transfer ownership, control, or reproduction rights to the user. Furthermore, data use creates yet more data, and the network effects increase the value of these platforms. Therefore, there is a new quality at play in the monetisation and marketisation of these digital HE products and services: 'assetization'. We are witnessing a widespread change from creating value via market exchange towards extracting value via the ownership and control of assets.

This research project aims to investigate these new processes of value creation and extraction in an HE sector that is digitalising its operations and introducing new digital solutions premised on the expansion of service fees. By introducing a focus on assets, and economic rents, this project offers a theoretically and empirically transformative approach to understand emerging HE markets and their implications for the HE sector. The assetization of HE is consequential because of the legal and technical implications for its regulation. It is also crucial to examine in any discussion about the legitimate and socially just arrangement and distribution of assets, their ownership, and their uses. The project employs an innovative, comparative, and participatory mixed-methods research design. It combines digital methods, interviews, observation, document analysis, deliberative focus groups, knowledge exchange and co-production with stakeholders, and public consultation. Data analysis will include quantitative and qualitative analysis of investment trends, comparative case studies of investors, EdTech companies and universities, and social network analysis.

The application of this research project is fourfold. First, it will help universities understand the emerging processes of assetization so they can develop policies and practices for protecting their rights. Second, it will assist entrepreneurs in finding ways to incorporate ethical and sustainable considerations in their innovation processes. Third, it will mediate between the financial interests of investors and the social function of universities. Here, it will provide evidence for policymakers on how to include assets in HE sector regulation. Finally, it will unpack potential forms of inequality that assetization might bring into the HE sector.

Planned Impact

Who will benefit

The direct beneficiaries from this research will be universities, education technology (EdTech) entrepreneurs, and financial investors interested in EdTech. The indirect beneficiaries will be higher education (HE) policymakers, students, university staff, university administrators, and society at large.

How will they benefit

Universities are collaborating with EdTech companies to digitalise all of their operations. They are producing an unprecedented amount of digital data. EdTech companies attempt to monetise and make use of this data in developing new and more digital products (Mirrlees & Alvi, 2019). Universities need to understand how digital data they produce is monetised (in the commodity or an asset form), by whom, under what rules, with what rights and with what consequences. They need to consider what should be their role in securing and monetising their data, what rights should they have in relation to EdTech companies, and how they can balance their social role with rent-seeking in the future digital HE industry. The project will initiate this debate among universities, which will be supported by the project partners (particularly UUK, GuildHE and Jisc). The project will also produce advice, good practice examples, and resources to manage the mentioned challenges.

EdTech entrepreneurs are fruitfully benefitting from research on technology in relation to teaching and learning, which is exemplified with the UCL mentoring programme called 'Educate'. In it, start-up entrepreneurs receive support in understanding rigorous research practices to aid the development of their products. But there is a lack of research on the political economy of EdTech (Mirrlees & Alvi, 2019). In light of the booming EdTech industry, JISC with Emerge Educate (a start-up facilitator and seed investor) developed guidelines for university leaders on how to manage their relationships with start-up companies (Iosad, 2019). This indicates that the fast technological innovation brings new opportunities, but also demands careful legal and operational arrangements. However, these new guidelines for university leaders focus on sustainability of the start-up business model but do not mention ethical products or treatment of data. This project will produce knowledge on synergies and tensions of their visions with universities'. It is key that entrepreneurs are part of the debate about ethical ways of innovating. The project will produce a report and resources on the role of entrepreneurs in the growing digital HE industry.

By choosing what gets funded and created, investors importantly influence the future of our economy (Feher, 2018). Investors in EdTech need to consider links and tensions between them, entrepreneurs and universities. They will benefit by becoming part of the discussion on different kinds of value construction (via commodities, assets, and various business models). They will make use of the project report, which will highlight the consequences of different future scenarios of assetizing digitalised HE and their role in them.

Finally, policymakers face a serious challenge in how to regulate the fast dynamic of EdTech and its role in HE. They will benefit from recommendations that the project will produce on how to regulate the monetisation of digital data and products in HE. Students, university staff, university leaders, and society at large will benefit as this project will contribute insights to the public concerns on how we as a society want to manage privatisation of our digital data, what should be the rights of different actors, and who should pay (Savona, 2019). The findings will, therefore, have significant implications for the future of HE. They will also feed into broader discussions on the digital economy and the future of work.


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