Educational Revolution: The Rise of Private Monopolies | By Hardik Agarwal

“Change is the Law of Nature.”

Education is no longer confined to the four walls of a classroom; it has evolved into dynamic and student-tailored courses at students' convenience. All changes are not to worsen the situation but we know how India suffered during the British Era when foreign invaders introduced rote learning and destroyed educational centres in India. We have come a long way since then and are regularly trying to move towards practical-based learning. We have faced a lot of challenges and won many of them. Kudos to our educational institutions who worked incredibly outstanding when it came to adopting digital learning as the only viable solution during the Covid-19 Pandemic. Though it’s unclear if the change is for good or not, it appears that what we are currently experiencing is just the precursor of another Educational Revolution. To add to this pace, the EdTech Industries are playing a very big role in Revolutionising Education.

$400 Billion! That’s the estimated total global expenditure in EdTech. We all know how much EdTech has grown soon after the outbreak of the Covid-19 Pandemic. The increasing level of penetration of the Internet was like a cherry on the top. As Byju Raveendran, Founder & CEO, BYJU'S, said in August 2020, “Before the crisis, we had 40 million free users who were acquired over four years. But in the last four months alone, we added more than 20 million users.” With dozens of acquisitions including Aakash, Toppr, WhiteHat Jr, and a valuation of $16.5 billion, it has been crowned as the world’s most valuable educational technology company. This shows how much an EdTech company, in specific, and the EdTech Industry, in general, has grown. But the question is- Has EdTech dominated the Education industry? Before coming onto that, we must have a bird’s eye view of this industry.

EdTech, short for Education Technology, entails the use of new technologies in educational institutions. No doubt, studying from home using smart devices also comes under EdTech. Companies that cater to online education come under the EdTech Industry. Major players in India are BYJU'S, Unacademy, UpGrad and others. Some global players in this Industry are VIP Kid, Blackboard, Udemy, etc.

EdTech platforms helped everyone a lot, particularly in this pandemic, to continue studies and learning despite many challenges. They have helped in bringing the knowledge to our fingertips with ease. We can now access a lot of information and learn new things at minimum cost and maximum ease. But every coin has its flip side. The EdTech companies are criticised severely for their unethical behaviour, exorbitant rates and rote learning modules. For example, BYJU'S faces criticism daily for its course structure, misleading information and debt trap- the online coding courses for a 6-year old kid cost Rs. 1 lac! WhiteHat Jr’s claim of a 9-year old kid, named Wolf Gupta, who got placed in Google with a 100cr package due to his coding skills is completely misleading and false. They are also criticised as they tend to make students exam-centric and deprive them of learning any other skill. BYJU’S spent nearly Rs 450 crores on advertisements in FY19, a 239% increase from FY18. BYJU’S and Unacademy were among the brands that bid heavily (Rs 201 crores and 170 crores respectively) for IPL 2020 sponsorship. Even the expansionary budgets of these companies look frightening- some giant EdTech companies are always on an acquisition spree. BYJU’S even acquired brick-and-mortar coaching network Aakash Institute for close to $1 billion. WhiteHat Jr has filed defamation cases worth crores against many of its critics. Pradeep Poonia and Dr Aniruddha Malpani explain how BYJU'S-owned WhiteHat Jr always tries to curb their voices by using its deep financial resources and strong legal foothold. This raises concerns about the growing dominance of Tech Companies in every industry and the ever-rising need to regulate them.

Now, let’s have a look at the war started by the Chinese Government against its own Chinese EdTech Industry. The Chinese Government made a controversial move by asking all the players in the education technology (EdTech) sector to convert into not-for-profit organisations. This means a loss of business for all those involved in the Private EdTech Sector. Additionally, China also put a bar on EdTech firms by prohibiting them from raising funds, launching IPOs and acquiring other educational services. According to reports, EdTech companies in China were accused of triggering social inequality by providing extra coaching to those who could afford it. The government authorities felt that EdTech serves no real purpose and might limit the country's true potential. Chinese authorities began questioning the very existence of private tutoring services. As a result, the Chinese market experienced an unprecedented selloff of popular tech stocks after the announcement of the news. Chinese tech companies collectively lost nearly $1 trillion in market cap within a few days.

On the other hand, in India, EdTech companies are setting new records in valuation. Defining itself as one of the 15 most valuable start-ups in the world, BYJU'S is valued at $16.5 billion. A strong expansion is taking place by the company in the States too. To expand the business, the company has also intensified its acquisitions. From 10 acquisitions in 2019 to 23 in 2020, the EdTech Giant more than doubled its acquisitions. This year alone, BYJU'S has already closed six acquisitions. The new restrictions China has imposed on its online education industry are a piece of good news for Indian EdTech firms like BYJU'S, Unacademy, and UpGrad who anticipate soaring valuations as they undertake aggressive acquisitions before going public. But this is an alarming signal for both the Indian government and individuals as the concentration of power in the hands of some big giants may mean oppression on the part of the consumers.

Now coming onto our very first question- Has EdTech dominated the Education industry? The answer is a clear NO. The reason is hardly 5% of total global educational investment is spent on EdTech. So, EdTech has a long way to go but even though the percentage of total expenditure is so low, their dominance seems terrifying which forces us to think about what complete tech-oriented education would mean for common citizens. Recent history shows how increasing dominance of any company catches the government’s attention who then tries to regulate them - and it can be either through Antitrust Laws, Restrictive Policies or financial sanctions. Even India recently waged a war against Tech Giants by forcing them to keep users’ data in local Data Centers only. So, now it depends on the government how and when they'd be bringing better regulatory policies that could eventually benefit students.

CONCLUSION

The EdTech industry in China was a $100 billion industry- a booming one attracting FDIs and contributing to China’s GDP. Then, why did China suddenly restrict all EdTech firms? Did it forecast something which we are missing? China decided in favour of the general public because we know that China might be evil for the whole world but it never takes any decision which would hinder its country’s growth. This makes us think that there is something wrong with the growing dominance of EdTech. Undoubtedly, EdTech is a boon for many students who were able to access cost-effective and remote learning even during Covid but unregulated advancements may prove to be a bane in no time. We must acknowledge the benefits of EdTech but must also be aware of its negative side. At last, the decision of how to spend and where to spend depends solely on consumers i.e. students. So, we must spend our time and money on EdTech very wisely.