Mobile e-Learning Stocks: U.S. Education, Unemployment, and Baby-Boomer Evolution

Perhaps we might find stable market growth by 2010. The data without question paints an overwhelmingly picture. This report highlights potential solutions and many of the key corporate and government players involved in the necessary “mobile e-learning” global market.

Several major hurdles remain ahead for the U.S. particularly dictated by population trends. Therefore, even if the current economic financial crisis subsides the U.S. will be only one in a handful of players attempting to compete in the prized high wage knowledge driven global economy.

For example, consider the fact that from 1994 to 2007, U.S. firms increased the number of people they employed in R&D jobs outside the United States by more than 78%; U.S. National Science Foundation. This trend will continue unless the U.S. can generate a more innovative educated workforce. Further supported by “The U.S. Department of Education Innovation and Reform Report, (October 2008)” that shows clear needs to overhaul the education systems.

The U.S. e-Learning consumer market reached over $31 billion in 2008. There are several forms of e-learning tools such as real-time collaboration platforms, Game-based Learning, smart cell phones, laptops, wireless e-Books, netbooks, wireless tablets, blue tooth mobile devices, wireless automobile voice systems, Software as a Service (SaaS) or digital “Referenceware.”

Today, there are over 220 million wireless device and cell phone subscribers in the United States of these over 63.2 million access educational information and news via the Internet.

The Growing “e-Learning” $52.6 Billion Global Market

Europe accounts for 15% or $9 billion of the e-learning enterprise market. Overall usage of e-learning in Asia is a $12 billion market expected to reach a compound annual growth rate of 28% through 2013. On average the worldwide annual mobile e-learning sector growth rate is about 22% through 2013.

Many developing countries with poor infrastructures have leapfrogged an entire generation of technology moving directly to mobile devices enabling widespread access to educational information.

India. In one month alone (January 2009), India added more than 15 million mobile subscribers. Furthermore, analysts have predicted that over 225 million people in India will be using e-learning type applications on their mobiles by 2009. For example, The School Education Department of Chennai (India), SNDT Women University, Mumbai (India), and Tata Teleservices (TTSL) – subsidary of Crore Tata Group in partnership with Japan’s, Nippon Telegraph and Telephone Corporation (NTT) invested several billion dollars to deliver mobile e-Learning to the 1.17 Billion people in India.

Africa. The number of mobile users in Ghana (pop. 22.6 million) increased from 383,000 in 2002 to 10.2 million in 2008. Nigeria’s mobile providers report the subscriber base grew 55 percent in 2008 to nearly 63 million mobile customers out of a population of 145.5 million. In 2007, 77% of Africans had mobile devices, while only 11% had computer access.

The Philippines. Cell phone penetration in the Philippines is over 75% (more than 67 million subscribers), with high percentages using the “smart” (data) plan. Per capita income in the Philippines in 2008 was $1,390, according to The Economist.

Vietnam. In this country (population: 85.3 million), the average GDP per person is $725 per year, but somehow, over 57 million people in 2008 found a way to pay for a mobile handset and service plan.

Slovenia. The former Yugoslav republic recently topped the 100 percent penetration rate for mobile phone utilization, with increasing uptake of the data plan.

It would not be at all surprising to see the nexus of innovation in mobile telephony shift dramatically as this gap makes itself felt further eroding the U.S. grip on R&D innovation.

The U.S. Wireless Mobile Internet Market

Today, the U.S. had more than 5-times as many mobile devices bought last year (2008) than as desktop computers. By using mobile e-learning technology indivi... and corporations can save about 60% in education and training costs versus the spiraling costs of “brick and mortar” schooling methods.

Although the teachers unions are fighting it, every state is working with the U.S. Department of Education now lacking budget resources is shifting investment towards a “Virtual Charter Schools (complete list)” a efficient e-Learning systems.

The demand of e-learning in small corporations increased by 8.51% (2008). The demand of e-learning from medium and large size corporations shows robust growth at 18% (2008) forecast through 2013.

The State of the Nation and Challenges Ahead

Later in the article, I will better define the key “mobile e-learning” corporate players but consider for now some immediate reasons for the U.S. to invest in such efforts including;

1. Today, the economic crisis continues to show on average nationwide the Hispanic unemployment has risen to 10.9 percent. African American - black unemployment has risen to 13.4 percent. White unemployment has risen to over 8.3 percent, according to the U.S. Bureau of Labor Statistics, March 2009.
2. The unemployment numbers are particularly devastating when coupled with the recent study, “Comparative Indicators of Education in the United States and Other G-8 Countries: March 2009”; a report that found the United States public education system ranks very low compared to other industrialized nations in providing our country with educated high wage workers. For example, the U.S. ranks 25^th out of 30 countries in math and 24^th out of 30countries in science skills. This fact means kids graduating school and adults training for careers qualify for low level wage jobs considered about $12 per hour that are easily replaceable.

Today, the United States holds less than 24% of the world's 194 million college level degrees -- degrees broadly equivalent to a U.S. baccalaureate. In 1990, the U.S. share was closer to 33% of the world's then 73 million degrees. Notice the shift of about 10% within a short time that affects the economic ability of the U.S. to capture global R&D venture capital money and high wage jobs.

For evidence the U.S. is rapidly losing its grip on R&D innovation in the key high wage industries examine the clean technology sector and energy industry emerging leaders including; clean water (Asia), wind power (Europe), electric battery techs (Japan/South Korea), solar power (Germany/Israel), bio-fuels (India/Brazil) among many other sector examples.

Note the insightful quote below by three-time Pulitzer Prize winner Thomas L. Friedman, NY Times Columnist), further supporting the critical need for the U.S. to embark on what I would term as “The U.S. Educational Evolution” to overhaul the educational system within the next 3-years in order to maintain any remaining competitive advantages.

The world has become increasingly “flat,” as Thomas L. Friedman (Book, Flat, Hot and Crowded) has shown. Thanks to massive improvements in communications and transportation, virtually any place on earth can be connected to markets anywhere else on earth and can become globally competitive. But at the same time that the world has become flatter, it has also become “spikier”: the places that are globally competitive are those that have robust local ecosystems of resources supporting innovation and productiveness. A key part of any such ecosystem is a well-educated workforce with the requisite competitive skills. And in a rapidly changing world, these ecosystems must not only supply this workforce but also provide support for continuous learning and for the ongoing creation of new ideas and skills.

If the U.S. public education high school dropout rates remain as they are now at over 40% in states including Oregon, Idaho, Nevada, New Mexico, Washington, New York, Washington D.C. and Kansas -- it will be tough to supply a competitive workforce for continuous learning and for the ongoing creation of new ideas and skills focused on innovation and productiveness.

As education costs in the U.S. sky rocket higher — tuition, fees, room and board at public four-year colleges have surged 47% in the past decade or 5% annually — more students have had to borrow enormous sums to finance college. The total cost of going to a private four-year college rose to $34,132 on average per year for the 2008-09 academic calendar; according to the U.S. College Board.

3. Finally, we arrive on the subject of the “baby-boomer” population of 78 million with data proving these aging tax payers in the U.S. will retire with much less income further reducing tax revenue resources available to reinvest. This has begun to strain resources significantly as the numbers decline of taxpaying workers and labors available to generate (GDP), yet it is required trillions more dollars in costs needed to support the aging baby-boomer population.

The March 2009 - Henry J. Kaiser Family Foundation research study “Healthcare Cost and Their Impact” shows the U.S. spends about $7,400 per person on health care each year. Sixteen percent of the U.S. economy is devoted to health care costs. The United States spent $2.2 trillion on health care in 2007. This $2.2 trillion represents 16.2% of the nation’s total economic activity, referred to as the gross domestic product or GDP.

Additionally, the Social Security (OASDI) financial estimates are shocking. The reason that the OASDI cost rate will increase rapidly between 2010 and 2030 is that, as the large baby-boom generation those born in the years 1946 through 1965 retires, the number of beneficiaries will increase much more rapidly than the number of tax payers working. There were about 3.3 workers for every OASDI beneficiary in 2007. However, the baby-boom genera­tion will have largely retired by 2025, and the ratio of workers to beneficia­ries is projected to be only 2.2 within a short time. Thereafter, the number of workers per beneficiary will decline, and the OASDI cost rate will continue to increase.

What is “mobile e-learning” and why is it such a critical investment for the United States?

The answer to this question is summarized in three words, “GLOBAL ECONOMIC COMPETITION”. Given the data outlined, it is clear the United States should invest heavily in overhauling its educational systems. After reviewing the overall data, I would even go as far to say improving education should be a U.S. national security priority.

Given the massive cost burdens we are encountering including the $11 trillion national debt and stimulus packages - if significant national educational policy milestones are not accomplished within the next 5-years the U.S. will likely no longer be a top five player in the global economic landscape.

To overcome the spirally costs of education in America, one cost effective way to gain value is to focus heavily on “mobile e-learning” pushing the delivery of interactive text, audio-video, graphics, and educational information to the over 220 million cell phone and wireless device subscribers in the U.S. thru cost effective mobile infrastructures such as 3G broadband, WiFi, WiMAX, cell towers and satellite technology.

Mobile e-Learning and Social Network Educational Content Vendors

Companies including many key and niche players worldwide such as Adobe Systems, Inc. (ADBE), Apollo Group, Inc. (APOL), Articulate Global, Inc., Blackboard Inc. (BBBB), Career Education Corp. (CECO), Cegos Group, China Enterprise Netcom Corp. Ltd. (China Entercom), Cisco Systems, Inc. (CSCO), CognitiveArts subsidiary of NIIT Limited - India (NIILT.BO) , Convergys Corp. (CVG), Corinthian Colleges, Inc. (COCO), Corpedia, Inc., eCollege (ECLG), Epic Group PLC, GeneEd, Inc., GeoLearning, Inc., Harcourt Inc. (RUK), Hewlett-Packard (HPQ), iLinc Communications, Inc. (ILC), Inspired eLearning Inc., International Business Machines Corporation (IBM), IntraLearn Software Corp. (ISC), Kaplan, Inc., KnowledgePlanet.com, KnowledgePool Group, Learn.com(R), Learning Management System (LMS), Learning Tree International Inc. (LTRE), McGraw-Hill Companies (MHP), Mentergy, Ltd., Microsoft Corporation (MSFT), MiracleMind.com, Moodle, NetDimensions Ltd., NYIF.com, Oracle Corp. (ORCL), Pearson plc (PSO), Plateau Systems Ltd., Premiere Global Services (PGI), ProQuest Company (PQE), Saba Software (SABA), SkillSoft Public Limited Company (SKIL), Strayer Education, Inc. (STRA), SumTotal Systems, Inc. (SUMT), SyberWorks, Inc., Sylvan Learning, Tata Interactive Systems (TCL), The Ken Blanchard Companies, Trivantis Corp., Verizon Wireless Business Solutions (VZ), WBT Systems Ltd., WebEx Communications, Inc. (WEBX), and Zenosis Limited.

Wireless - Mobile device manufacturers' market share in Q3/2008

In Q3/2008, Nokia (NOK) was the world's largest manufacturer of mobile phones, with a global device market share of 39%, followed by Samsung at 17% (SSNLF.PK), Sony Ericsson at 9% (SNE) , Motorola at 8% (MOT) and LG Electronics at 8% (LGERF.PK). These manufacturers accounted for over 80% of all mobile phones sold at that time.

Other manufacturers include: Apple Inc. (AAPL), Audiovox - now UTStarcom (UTSI), BenQ-Siemens, CECT, High Tech Computer Corporation (HTC), Fujitsu Ltd. (FJTSY.PK), GeoSentric, Kyocera Corp. (KYO), Mitsubishi Electric (MMTOF.PK), NEC Corp. (NIPNF.PK), Neonode Inc (NEON), Panasonic Corp. (PC), Palm, Inc. (PALM), Matsushita Electric Industrial Co. Ltd. (MC), Novatel Wireless, Inc. (NVTL), Koninklijke Philips Electronics NV (PHG), QUALCOMM Inc. (QCOM), Research in Motion Ltd. (RIMM), Sagem Communication (of SAFRAN Group - France), Sanyo Electric Co., Ltd. (SANYY.PK), Sharp Corp. (SHCAY.PK), Siemens AG (SI), Sendo Smart Phones, Sierra Wireless Inc. (SWIR), The SK Group - Korea, Alcatel-Lucent (ALU), China's Huawei Technologies, Trium Group, and TOSHIBA CORP (TOSBF.PK).

Among emerging wireless device global leaders, Apple Inc. now has a better than 20% market share of the mobile notebook industry sector. Additionally, we see wireless “e-books” and “smart phone” increased over 17% for 2008 - devices capable of delivering high quality multimedia - “mobile e-learning” educational content. Resources such as Ebooks Corporation Limited (Australian public company), Amazon Kindle ebook (AMZN), and Sony's Reader Digital Book (SNE) are among the emerging e-book industry leaders.

Conclusion

The mobile e-Learning market sector will continue growing annually at 22% or more for the next 3-5 years. This growth will be driven by global population trends and competitive economic factors. The widespread global accessibility of wireless mobile e-Learning tools will accelerate innovation and economic financial competition therefore increasing the requirements of cost effective mobile e-Learning for a highly educated workforce able to capture high wage jobs in order to maintain acceptable standards of living.

Today, the U.S. education system ranks (24^th) worldwide very low, therefore much larger investments of perhaps $700 Billion dollars or more are needed by both private corporations and government entities. The need for solutions to this issue are of a timely manner as the baby-boomers rate of retirement accelerates within a short time. At the time of writing this article, I held no significant direct financial interests in the companies listed.

Comments

[Gregman2:]

Until 3G infrastructure builds out in the the BRICs, and until costs come way down for 3G+ phones, don't get overly excited yet--I've been tracking this for a while and though it has a very bright future it's still slow to emerge.

May 07 10:41 AM

[Trane250:]

This is the same old "new economy," "new world order," "new paradigm" mantra that the elites like to regurgitate over and over. Education is the panacea for all of our ills and by the way let's cash in on the big bucks waiting to be made in this game. Remember the old term "college material?"

May 07 11:06 AM

[RWCMom:]

The dropout rate remains high because those students that used to thrive in shop, automotive, nursing & other trade classes have only the option of sitting in academics only classes that bear no relationship to the world in which they live. They must now wait until they are of age and can take out a loan to take those classes at a for-pay trade school. The US sure knows how to monetize anything

May 07 05:56 PM