October 2017 – International Observations from Brazil and Toronto, Updates on Open Source Trends

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This month we take a closer look at emerging trends in the Brazilian LMS market based on our data and what Michael and O’Neal learned on their trip to the ABED distance learning conference in Brazil last month. Phil reports back on his experience at the recent World Conference on Online Learning in Canada, and lastly, we present some insights from recently compiled market data on open source LMS market share (spoiler alert…it’s not good, or maybe it is, depending on your perspective).

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On to the updates.

LMS Market Trends in Brazil 

Last month Michael and O’Neal traveled to the annual Associação Brasileira de Educação a Distância (ABED) Conference in Iguassu Falls, Brazil. ABED is a large distance learning association in Brazil that has been bringing practitioners, administrators and ed tech vendors together since 1995. This year’s conference hosted over 2,000 members with a focus on the theme of how to implement active learning techniques in the distance learning context. Michael gave the introductory keynote, somehow managing to tie Paulo Freire to the concept of personalized learning; O’Neal presented a lecture (in Portuguese, no less) on global LMS market trends the following day. We’ll be blogging more in the coming weeks about the conference and ABED’s impressive national census on distance learning that they been conducting and expanding over the last 11 years. For today’s newsletter, we’ll focus on what we learned about the evolving market for LMS’s in Brazil and more broadly in Latin America.

Brazil has been heavily invested in distance education for the last 10 to 15 years and has become increasingly reliant on the LMS as a core platform. Since the early 2000s, open source platforms (as one person we talked to said, “‘Open source’ is Moodle in Brazil”) and a smattering of home grown options have predominated. Blackboard has also been a sizable player through the efforts of a local partner, Grupo A. More recently, D2L and Instructure have entered the market. D2L preceded Instructure by a couple of years, and both companies are now clearly on people’s radar, though their market share is small.  The donut graph below shows the market share breakdown by percentage of implementations for each platform.

If you’ve been a regular reader of our reports and newsletters over the last year and a half, or even if you just work in higher education, you probably know that the open source platforms have plateaued in North America and Europe and are possibly in decline (see story below). Canvas is gaining market share at a rapid clip in North America and now Europe and D2L is showing resurgent strength in these geographies as well. Blackboard has been going through its internal gyrations but seems to be largely holding steady. 

At the ABED conference we presented slides with details on global trends related to market share and market momentum, using recent wins in open LMS competitions as a proxy for momentum, and uptake of cloud hosting as opposed to on premise hosting. We were curious to find out how these trends are playing out in Brazil and were looking to get input from conference attendees, vendors and other players in the education sector.

What we saw and heard in both Iguassu Falls at the conference and in Sao Paulo during meetings with vendors and universities has convinced us that changes are underway in the perception and composition of the LMS market in Brazil. Universities, and other educational institutions, are now looking beyond Moodle, Blackboard and a handful of homegrown solutions. They are very interested in what is happening in other geographic regions with regard to LMS market trends. And we heard ample anecdotal evidence to back up some of the early data signals we’re getting regarding recent wins by new market entrants. At a minimum, the newer platforms are being seriously considered and a number of institutions are switching platforms.

That said, Brazil has one of highest, if not the highest, installed Moodle base in the world with 82% of the market. The market will not change overnight, and there are several plausible factors that could work against Brazil following global trends:

  • Brazil’s embrace of cloud hosting is not aligning with global trends as of yet. In other words, on premise hosting remains the more popular choice in Brazil. If this preference holds, it could be a big limiter for the potential of cloud based solutions.
  • There is a perception that Moodle, as an open source solution, is free or at least the cheapest option. 
  • Existing business relationships can be based on personal relationships, complicating the nature of what influences business decisions.
  • It could be that educational problems that need solving in the Brazilian market are not being addressed by the platforms developed by Canadian and American companies. Cultural barriers could get in the way of conducting business successfully.
  • It’s possible that Moodle is meeting market needs and there is no compelling reason, other than on the margin, to go to a new solution.

We will be keeping an eye on developments in Brazil and Latin America more broadly. While regional context varies country by country, LMS market fundamentals are less variable. For example, Moodle has been and continues to be the dominant player across the region, cloud hosting has been slower to take root and new market entrants D2L and Instructure are slowly but surely notching wins. From our perspective, it’s not a question of whether the LMS market in Brazil will change but to what extent and how fast. Furthermore, we’ll be watching for any regional variability, or anomalies, and trying to understand those drivers as well.

World Congress of Online Learning

Last week Phil had the opportunity to attend the World Congress of Online Learning in Toronto. In addition to participating in the Wednesday plenary panel, he also presented a special briefing on the future of the LMS with standing room only attendance. Thanks to Stephen Downes, we have some pretty good notes on the session to go along with the slide deck.

The setup of the talk was that online learning should no longer be viewed as an extension of the past – trying to replicate face-to-face experiences in an online format. We should also avoid the hype that everything has changed and universities are going away. What we believe is we are in the midst of an inflection point in higher education driven by mainstream adoption of ed tech, different platform designs, and the ability to move beyond the digitization of traditional classroom.

This is the context of the future of LMS usage, and the overall theme should explain movements towards opening up the walled garden, adaptive learning, and the use of data and analytics.

First up, here is the slide deck as presented at the session.

And to accompany the slides, here are the notes from Stephen Downes.

Open Source LMS Market Share in Decline in North America

In our Fall 2016 LMS Market Dynamics report, we presented data that showed that the open source LMS market share had pretty much plateaued – we were seeing no new growth. Our most recent data through September 2017, however, suggests we are seeing a reversal more than a plateau, at least in North America. After an impressive growth streak from 2002 through 2012 or 2013 when market share plateaued around 34%, we now see that in just two years, open source market share has dropped to 30%. We’ll continue to watch this number carefully. Given the lack of major wins by either Moodle or Sakai over the last several years, and rapid growth by some competitors,  it’s not surprising to see a market share decline play out in the data. We’ll be looking to see if open share market stabilizes or continues its downward trajectory.

Open Source (Moodle and Sakai) Market Share in North America

Will the International Market Follow a Similar Trend?

Open source LMS’s, led by Moodle, occupy a dominant position in the international LMS market, with over 70% market share. As we see above, however, they appear to have reached a plateau here is as well. The data doesn’t yet support the hypothesis that market share will decline in the same way it seems to be doing in North America. Other evidence, though, notably the recent entry and early success of new competitors, suggest that changes in market composition are coming. Just how broad and how deep is hard to say at this point. We’ll let the market data speak for itself over the next several quarters and provide analysis around what we’re seeing.

Open Source (Moodle and Sakai) Market Share in Europe, Latin America, and Oceania Combined

Until November

We hope that you found this news roundup useful. Later this year we’ll release our Fall Update and look at important changes and trends in the international LMS market since the publication of our LMS Market Dynamics report in the Spring.

We’re always open to feedback, which you can send to eLitLMS@mindwires.com.


Phil & Michael & O’Neal