How to survive ICT budget cuts

Some thought provoking observations from NWLG's CEO Gary Clawson in a piece on Merlin John's site, Gary predicts impending budget cuts for schools ICT, but sees this as possibly being "one of the most postive things that has ever happened to ICT development in our schools".

Gary highlights some examples of high cost, low impact interventions, but goes on to discuss how much more the education community could have achieved using the freedom to innovate which open source would bring, both for those in schools and for commercial organisations who could have added value to common core functionality without having to reinvent their own proprietary wheels.

Back at the Open Source Schools Local Authority Seminar in October, Gary launched the Open Source Councils Alliance (OSCA), which now has 50 members, far beyond the original core 17 from NWLG, with a principle objective of producing cost benefit analyses and implementation plans that would generate savings from current ICT expenditure - OSCA's target of at least 10% isn't nearly ambitious enough, if Becta's own TCO study is anything to go by.

Here's the launch announcement c/o Leon Cych's Learn 4 Life, together with an explanation of NWLG's other open initiative, the National Digital Resource Bank.

(Other formats available at http://blip.tv/file/2794749)

More about OSCA:

Purpose of OSCA (Open Source Councils Alliance)

OSCA is an alliance of UK Local Councils that wish to assess, evaluate and plan implementations of Open Source solutions at Enterprise level. Through this assessment process they will form strong development communities and share the expertise, ideas and practical solutions needed for the successful implementation of Open Source solutions. OSCA members will have different motivations for pursuing licence free ICT solutions but each implementation plan will have, central within its assessment, a focus on lowering the cost of ICT in schools.

Outputs

The primary output of each OSCA activity will be the production of a generic implementation plan that enables any member to fully assess what to do; how much can be saved and who is able to assist implementation. This will provide OSCA members with:

  • Evidence based justification to commence Open Source projects.
  • A sharing of implementation risk through other OSCA members implementing these identified solutions.
  • Identification of expertise and detail of capacity needed to implement enterprise wide solutions across OSCA membership.

Long term development of the OSCA community

The large scale implementation of Open Source products is just the first stage of OSCA. The strength of these Open Source products lie in the ability for them to be adapted and evolved further as changes take place in the needs of learners and from the demands of legislative changes. The OSCA community will also:

  • Form sustainable development communities around core educational Open Source products.
  • Direct and guide commercial providers towards future needs and developments of core education sector applications to assist commercial sector capacity building.
  • Further grow the principle of collaboration and shared risk to expand the use of core educational products including international partnerships. Particularly around the sharing of educational digital resources.
  • The review of, and proactive encouragement of the use of, appropriate international open standards for educational sector products.
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IanL's picture

It's rather ironic that it takes a world financial crisis to make the custodians of public money accept what has been a no--brainer to many of us for several years. If government is charged with getting best value for the taxpayer it should not require a 170 billion budget deficit to focus the mind. That is not in any way to be take as a criticism of Gary and Fiona who have taken the initiative ahead of the national agencies and stepped up to the plate to provide some brave and practical action. Practical action is a necessity because talk is easy, research is easy, writing papers is easy. What is difficult is shifting business models to support sustainable open source development, supporting take up and change management associated proprietary vendor lock-in backed by multi-million dollar marketing budgets. As Prince Charles said at the climate summit, politicians and civil servants will be remembered for the actions they took, not what they talked about.

It seems increasingly clear to me that companies that have their business models based on selling licenses for digital resources, either software or content, are increasingly vulnerable. Companies with new business models that are independent of selling licenses lower barriers to entry and take up. Google entirely disrupted the satnav supply market by giving sat nav facilities away free in their phones and they give away the hardware and software designs of those devices too. Why? Because it lowers barriers to take up and increases the number of people using their search and advertising business models. While some supply companies will be unaffected, the interesting thing is that all are vulnerable and it is very difficult to predict who might get hit next. Interesting times :-)

dhicks's picture

It seems increasingly clear to me that companies that have their business models based on selling licenses for digital resources, either software or content, are increasingly vulnerable.

But your average company has to be able to make money somehow - somebody has to be able to make a profit by selling actual things somewhere along the way (I realise that classing software or content as an "actual thing" is pushing the definition a bit, but there). Not everyone can be Google, or make all their profit from advertising. I think there's more mileage in developing software as open source and offering paid-for content, as that promotes open standards and would tend to favour the company that simply produces the best content as opposed to the company that manages to convince the most people to lock themselves in to their product.

IanL's picture
"But your average company has to be able to make money somehow"

Do they? average companies will probably go out of business. I'm not suggesting that demand for digital resources will disappear, just that the business models supporting them are changing. Indeed not everyone can be a Google, a Wikipedia, a Curriki, a You Tube, a Facebook, a Canonical, a Mozilla... but these are all providing digital resources free of the need for license fees. Only about 30% of software produced was ever commercially licensed in any case and there is no reason why consumers will compartmentalise software as separate from content. Advertising is not the only alternative even though it is a dominant one. (Sponsorship, grant, quality assurance, are others) The market is what makes license sellers vulnerable. If the expectation is that this stuff is usually free from te web, it's going to be very difficult to change. As soon as you put licensing costs in place your marketing costs go up because there is a barrier to entry. I'm not saying this will happen overnight just that all digital resource providers are vulnerable to a disruptive innovation.

Do you think that supporting educational software by advertising will ever be accepted by schools/LEA's/government?

IanL's picture

I don't think that it matters really. Do most schools ban Google searches because they carry advertising? Let's say that ACME company provided the entire curriculum on-line, a bit like Wikipedia but with progression pathways from 5-16 and pays for it with a discreet advertising model. Would schools use it? If it was good I think most would and the use of Google searches in schools shows that at least some advertising is tolerated. Of course it depends on the advertising but to make such a model work it would be in the interests of the provider to be careful - Google has been successful as much because of the way advertising is handled to make it relevant and discreet.

But I don't think advertising is necessary. Wikipedia does not have advertising. Curiki.org doesn't. The government spent ~ 500 million on Curriculum on-line. Let's say they invested that money in a foundation at 5% - £25 million a year. The Foundation started producing systematic support coverage of the NC under CC-SA license. Over a few years there would be other countries taking and adopting those materials for their curricula. (EU transfer of innovation grants would, for example, fund projects to do that even if national governments did not) That scenario would be self-sustaining without advertising and would be a lot more efficient use of tax payers money than the way that money was spent. My own INGOT model is self-sustaining without advertising (well it can be if I can get sufficient support from schools for our new ITQ qualifications). There are probably other models too that I don't know about or are yet to be invented.

In the end the government needs to save money and that means changing the way things are done if front-line services are to be maintained. If you do what you always did you will get what you always got. Change really is needed but the change is uncertain (political). That is why there is risk in business. Risk of staying the same or risk of choosing a wrong option (UK gov policy is to delegate perceived risk to business but it is not always sensible eg when there is little risk in reality and they are simply reinforcing a monopoly or reducing the ability of new players to compete). No-one has a divine right to a market or making a profit, it's about offering customers something they want or need with better value than the competition and hoping your sums and predictions go to plan. Getting the message across is very expensive which is why large companies with big brand strength and large teams to bid for government contracts have a clear advantage over small businesses that are normally under-capitalised. OTOH small companies can use the Internet, with faster response to innovation and lower overheads. It's the need for constant learning to support strategies to combat uncertainty that attracts me to it, but not everyone likes such a life ;-)

It is a really good case for Open Source learning/teaching resources. Fiona is right in saying that Teachers need to be able to modify and adapt resources to their classroom context.

The NWLG is very dynamic in this context and they have produced a really good set of resources for DiDA (www.dida-delivered.org). I really liked it but it suffered from the fact that it was not Open Source and I could not adapt it to EAL/SEN/Gifted and Talented pupils.

Ultimately, schools should only purchase Open Source digital content as they allow exactly what the DCSF is promoting (Differentiation / Every child matter).

It just means that the business model should change: charge for the creation of the digital resource, not for a licence.

chris_bradley's picture

Ian

the NWGfL have launched their National Resources DataBase some of which are Moodle based resources but includes other materials and delivery mechanisms. Membership is via LEA and mine are not proactive about it. However if resources from a number of other areas were submitted just 20 or 30 people could make enough of a difference to get take up among those schools that use open source. That in its turn would provide enough resources to bring in the cash strapped schools. Then the Open Source approach would begin to gain traction.

The difficulty lies with the LEAs, they control a lot of buying power but no-ones career is compromised by wasting 2 million on a commercial project that does not work however it can be by supporting an open source project that requires a higher level of expertise than shopping. Remember "no-one ever got fired for picking IBM"

If all of us on this list submitted resources and persuaded at least three others to do the same we would have an open repository (free) with contents that will work with open source (free) software. It could be completed by summer and have a real impact in the planning for the ensuing year. The structures are there we need to start to develop them.

Chris Bradley

ICT AST

Derbyshire

www.secondary-vle.net

www.secondary-vle.net/moodle

IanL's picture

In principle I agree, Open Source Schools has always had the potential to be more than a discussion forum. The snag is that although open development is economically (and some would argue ethically) superior, it does require some resource to produce things and even manage organisation. That is why I started a qualifications company. Designing qualifications and assessment models is less resource intensive so feasible to get started within very limited resources. We also now have at least a potential for generating revenue to sustain and coordinate open development that is independent of central government and LA politics. All the resources we have or will produce are CC-SA or GPL licensed and will as far as possible be in open formats, not necessarily just Moodle but Drupal, HTML, Ogg, odf etc. The business model encourages us to provide digital resources that support our qualifications and in turn to encourage learners (and their teachers and anyone else) to modify and re-use those resources freely as a community resource. That is something our competitors don't provide. An example is some games and puzzles our CZ partner is doing for the EU project. (Since we only have money I can raise I'm also motivated to go through the bureaucracy of EU grant applications!)

http://www.euro-face.cz/javascript/pexeso/pexeso1.htm

This is a web based version of the age old matching pairs game. It contributes to PLTS and the entry level INGOTs where learners need to know FOSS equivalents to popular closed source applications. The puzzle is written in Javascript for two key reasons.

  1. It is itself open source
  2. It runs in all major browsers so no barrier - anyone can use and see the code in any browser at home or at school

This means that learners doing the higher level INGOTs could produce their own puzzles for use by others. (We plan to fully document and explain not only the code but also how to get set up etc) To start with, producing new graphic images would be well within the scope of an average KS3 learner and to produce a new puzzle does not require understanding the coding to any extent. But once they can produce a new puzzle they can then find out how to increase the number of squares or change the rules and learn how the application works. While Javascript can be used for full object oriented programming, the aim here is more to motivate problem solving for a purpose rather than to produce programmers. This can stretch high attainers and perhaps mitigate against OFSTED's criticisms of some vocational ICT qualifications.

Now we have had the "ITQ INGOTs" agreed with the regulators I'm hoping we have removed another barrier to take up since this is now the new National Vocational Qualification and I have mapped everything to support APP in the KS3 national strategy. I think what we are trying to do is complementary to Gary's work, Curriki,org and similar projects. We all have the same goal in mind and we are free to share any resources we produce. Rhetoric about inclusion is easy, doing something about it is risky, hard work and uncertain which is why it is worth doing ;-)

So anyone is free to take resources from our web site, the thing is I have enough difficulty keeping up with developing our own project to make sure it is sustainable so the amount of time I could contribute specifically any other project is going to be limited and that is generally a problem for all projects dependent entirely on volunteers. So I would say campaign with your LA to support the NRDB and if you are a school consider taking up the new ITQ INGOTs as both of these will provide practical open source resources and teach children how to become safely self-sufficient using free and open resources from the internet.

johnyma22's picture

In answer to IanL: Googles TOS dictate you shouldn't make money out of advertising to kids @ Edu, they aren't strict at enforcing it. As far as I am aware.. For example kidrex.org is allowed to make $ in ad revenue however Primary School Safe Search isn't yet the 2 services are very similar, however because safe search is used in schools so much that the IPs are so limited and therefore google's anti fraud process assumes something fishy is going on. PS Safe search IS google search without ads -- I think this point is important. There are ad free alternatives so ad revenue is NOT reliable.

I'm on both ends of this debate, like a lot of you. Not only are we dependant on our revenue from our school email product but we are dependant on schools having additional budget available to pay for our consultancy services. 80% of our core services are free and open source as that is our mission statement. Budget cuts would be good for us because it would hopefully push the big contracts (signed at government / LA level) out of the way and allow for more small business to pick up more focused contracts which usually means higher quality of service and better value for the schools.

Our rule is never advertise to kids, but its fine to advertise to teachers & parents. Our open source ventures cost us close to £100,000 a year of which 10% comes from our AV installation team and 10% from technical support. We bring in £0 revenue from open source directly. The only way we bring in revenue is by contributing back to the open source projects then doing consultancy to big organizations looking to roll out a version of the service (ie etherpad).

IanL's picture

The whole advertising thing is complicated. Is an advertisement for HP brown source aimed at kids or adults? Would you not take kids to a West End play because they will see advertising on billboards etc? Like you, we bring in no money form Open Source directly, we don't do FOSS consultancy and we don't plan to use advertising. We have relied only on savings, angel investment, grants and certification fees from some innovative schools to get going and it certainly isn't easy. If it was it would have been done already. Clearly I don't think it is impossible though or I wouldn't be still trying :-). Like you, I think budget cuts would be likely to benefit us because we significantly reduce the cost of qualifications and increasingly provide the on-line support for them for free. The main problem is lack of brand strength but I do believe that can change over time, It's just finding ways to stay in the game long enough. There is no doubt in my mind that we can provide the entire curriculum on-line for everyone for free as well as reduce the cost of qualifications but that does require mass take up and achieving that is not a quick fix.

Just a couple ofthings to calrify from the postings:

First of all the National Digital resource Bank is unique because it a repository built using Open Source that has saved around £5M a year in licences. It also delivers 'open content', digital resources that are free to access but schools can't find them (many are within government funded intranets) and also the content has needed to be sorted, curriculum tagged and evaluated. The content is excellent and if schools are to use digital resources effectively then it should be esources that can be disagggregated, changed and owned in perpetuity instead of being 'rented' on an annual licence, often expensively. The NDRB represents the future of digital resources for schools and every item of content can be downloaded and used in any learning platform that supports open standards, those that don't need to go out of business!

In terms of business models, the national digital resource bank has to have a resilient server hosting and a lot of work goes into identifying the content and tagging it. The cost to schools is around £25 per year and that amount covers all costs as well as delivers a development fund for future software development on the open source base. So a very cost effective way of delivering exactly what schools want (some 10,000 resources due out), enabling them to own the resources and determine the future development of the repository. No adverts, complete sustainability, low cost and responsive to the specific demands of the community it serves. Well if that doesn't prove that Open Source projects can deliver better, cheaper, and have an effective business model (not involving advertising) then I don't know what can!

The only question left is "Why isn't every Local Authority adopting it to reduce the £100M per year that schools spend on digital resources every year?" The answer lies in the hesitancy they have in exiting current strategies that were based on the existence of eLCs which created a situation where lousy content on annual licences actually thrived. There is no need to scrutinise the Open Source business models that will emerge, first of all scrutinise the existing models that currently exist for procurement that clearly can't survive a world where grants will be much reduced - and do so before it is too late and all of our ICT development in Education experiences a dip based on reduced expenditure instead of an expansion based on smarter and better ways of working.

chris_bradley's picture

Gary

You will need to alter/amend the business model for the NRDB. I have expressed interest in it to my LEA, offered to be involved, found the specific person involved and asked to be kept up to date - but nothing. From them I would not know the NRDB existed and if I did I would not know how to take advantage of it. There needs to be additional modes of membership - School, Personal, possibly commercial.

Chris,

Would love to offer directly to schools but can't keep costs down if we have to go down to that level. By aggregating at LA level there are many advantages in cost as well as in co-ordinating gathering of resources. Yorkshire andHumberside have co-ordinated regionally which is even better.

Once we have determined that an LA is not going to be part of NDRB we will go down to school level but would like the LA to fully consider it first and help their schools save money and get plenty of resources.