Inside the Coursera Contract: How an Upstart Company Might Profit From Free Courses

Jeffrey Young:

Coursera has been operating for only a few months, but the company has already persuaded some of the world's best-known universities to offer free courses through its online platform. Colleges that usually move at a glacial pace are rushing into deals with the upstart company. But what exactly have they signed up for? And if the courses are free, how will the company--and the universities involved--make money to sustain them?

Some clues can be found in the contract the institutions signed. The Chronicle obtained the agreement between Coursera and the University of Michigan at Ann Arbor, the first public university to make such a deal, under a Freedom of Information Act request, and Coursera officials say that the arrangement is similar to those with the other partners.

The contract reveals that even Coursera isn't yet sure how it will bring in revenue. A section at the end of the agreement, titled "Possible Company Monetization Strategies," lists eight potential business models, including having companies sponsor courses. That means students taking a free course from Stanford University may eventually be barraged by banner ads or promotional messages. But the universities have the opportunity to veto any revenue-generating idea on a course-by-course basis, so very little is set in stone.

Posted by Jim Zellmer at July 30, 2012 2:02 AM
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