New market size analysis published by Edtech Digest, from GSV ADVISORS

The report offers a summary of overall Global Education Expenditure, and this is broken down into a series of catagories including e-learning at K-12, Higher post secondary and Corporate, and this is repeated for the US market.

The figures are very interesting, in showing likely growth levels to 2015 and gives a market size in 2017.

So what do they tell us in global terms….. Well the global spend on education is estimated at $4450.9bn and is slated to grow at 7%, with K-12 growing at 6%, Post secondary at 8% and corporate and government also at 8%. E-learning is however slated to grow at 23%.

This takes the e-learning market…globally from $90bn to $166.5 bn in 2015 and $255 bn in 2017. That is a Compound Annual Growth Rate (CAGR) of 23% between 2012-17. That is impressive.

The CAGRin the three areas of e-learning classified vary significantly. K-12 has 33% CAGR, Higher education 25% CAGR and corporate e-learning of only 8% CAGR. Education gaming is forecast to grow by 44% CAGR from $2.0bn to $7.4bn by 2017.

So corporate e-learning is forecast to grow at the overall market rate of Corporate and Government learning as a whole and that’s 8% CAGR! This is quite disappointing for the corporate e-learning market and its worse in the USA as this is forecast at 5%, but we must console ourselves that the corporate and government learning market in total is only growing at 4% CAGR 2012-17.

Our analysis of the numbers is limited, but one area we would highlight and probe in more detail is the relative size of the e-learning component of the corporate and government market. From a simple calculation it is possible to define that e-learning represents just 7.1% of the overall corporate and government expenditure globally and only 7.2% in the USA – that’s just $9.6bn of a total market of $133.3 bn.

We find the first figure a little high, – based on our analysis of the overall European market (published late 2010) and we have seen nothing in our monitoring and modelling to change our view on Europe’s market growth – slowing rapidly! And with the exception of the UK, Scandinavia and likely France no country achieves a 7% e-learning share of the total Corporate and Government figure.

Conversely, we see the US figure as understated, we would argue while globally the world is catching up, the US followed by the UK have been the pioneers of corporate e-learning. Our view on the UK market size is that corporate e-learning exceeds 10% and could be as high as 15% of the corporate and government market. This figure has been under downward pressure as Government expenditure, that represented perhaps as much as 40% of the market (excluding education) has slowed very markedly. In short the whole market is down across government and corporate.

Accordingly, we see the gap between the Global and US market in percentage terms as surprisingly low, and would have expected the US e-learning component of the overall corporate and government market segment to be nearer 15% to 20%.

We have no doubt that this research is very useful indeed to all of us trying to get a measure on the education and e-learning market, and it is not easy. It is not easy to define and capture what is meant by e-learning, and it is likely that the definitions used play a major part in the variances in our views.

You can see the table at edtech Digest and learn about GSV Advisors here