Team 31 Technology of the week: MOOCs, Duolingo and Khan Academy

Our technology of the week paper is about MOOCs or Massive open online Courses. These are websites

that provide online education through either apps or websites. Some well known MOOCs are Coursera,

EdX and FutureLearn. In our paper we focused on Duolingo and Khan Academy.

Duolingo is a MOOC that teaches languages. Currently it offers 40 language courses in 32 languages to

over a 100 million users. Duolingo uses gamified learning to teach you words and phrases in the language

of your choosing. The student can work through a lesson-tree and earn experience points and coins by

finishing up these lessons and doing their daily practice.

Duolingo’s business model is where it gets more interesting for a Business Information Management

student. Duolingo makes of use of crowd-sourced translations. How does this work? Duolingo will teach

you the language that you want and gives you practice articles you can translate. These practice articles

are provided by their partners (E.G. Buzzfeed and CNN) who pay to get translated articles. To make sure

all translations are actually correct, Duolingo makes use of the “Wisdom of Crowds” by using an

algorithm to aggregate all translations provided by the students. Furthermore, Duolingo is now

introducing language certificates for $20, currently these are only offered for English proficiency but it

will likely be available in more languages in the future.

To analyse both companies we made use of the SWOT analysis. The strengths of the business model are

that Duolingo’s revenues are not dependent on advertisement and thus visitor numbers do not cause a

lot of volatility in profits. Moreover, Duolingo fulfills needs of language learners but lets them work for

them without the students actually knowing they are doing work. In this way value gets created for the

students who learn a language, companies that get cheap translations and Duolingo who receives money

for providing value to these two parties. Lastly, Duolingo is diversifying its income streams by starting to

sell Language Certificates.

These certificates however, are not recognized by a lot of institutes yet and are therefore of limited

value. We see this as Duolingo’s main weakness in their businessmodel. More on the rest of the SWOT

analysis later.

Secondly, we took a look at Khan Academy which has a completely different way of doing business. Khan

Academy is a non-profit organization that relies mainly on donations to keep their operations running.

Khan Academy offers mostly university level courses in mathematics, economics and STEM. These

courses are also offered in a gamified way. You can earn points to buy upgrades and you can also level

up your avatar like a Pokémon.

Khan Academy’s main strength is that it is highly esteemed among its users and contributors. As

donations is their main source of income it is very important that public relations are well maintained.

Khan Academy has acquired relations that donate regularly, the most noteworthy of their relations is the

Bill & Melinda Gates foundation and Carlos Slim Foundation who of which both owners compete for

being the richest person on earth every year.

However, relying on donations for you existence may not be a sustainable way to function. If one of the

big contributors withdraws from donating regularly, you lose a lot of income that may not be easily

recovered. We identified this as the main weakness of Khan Academy.

Furthermore we identified opportunities and threats that were quite similar for both companies as they

operate in the same industry. Opportunities mainly involved increased internet access in developing

countries. This will broaden the user base of both Duolingo and Khan Academy. This may result in more

revenues for Duolingo and more donations for Khan.

Threats were mostly inherent to information goods. Information goods are easy to copy and therefore

MOOCs in general are easily attacked by substitutes. However, we think that due to network

externalities both Duolingo and Khan Academy are able to mitigate these risks.

In conclusion, we see that even though Duolingo and Khan Academy operate in similar business

environments and offer roughly the same products, they deploy completely different business models

and seem to be very successful in doing so.

Team 31:

Marianne Glas, 437320

Eelke van der Horst, 356523

Minke Huizenga, 333954

Niels Uiterwaal, 437200

Marjolein Volkers, 344064


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