OpenCourseWare: Working Through
Financial Challenges

Cecilia d’Oliveira and Steven Lerman

MIT OpenCourseWare (OCW) is widely acknowledged both around the world and here on campus as a tremendously successful act of intellectual philanthropy by the MIT community. Evaluation research shows that about 60 million people have used OCW for a broad spectrum of teaching and learning purposes, and more than 90% of them find the materials well suited to their needs.

OCW has also proven to be an enormously valuable resource for the MIT community. Over half of incoming freshmen are aware of OCW prior to choosing MIT, and a third of those cite OCW as a significant influence in their choice of school. Ninety-four percent of students at MIT access the site, and half of alumni surveyed use the site for one or more educational purposes.

Eighty-four percent of MIT faculty surveyed access the site in developing their courses. One-third of faculty who contribute to OCW report the process improves their course materials; a similar number developed greater comfort with teaching on the Web; and one-third also report that publication of their course’s materials on OCW has improved their professional standing in their field [OCW faculty and student surveys, 2005-2008].
The initial publication of virtually the entire MIT curriculum, completed in November 2007 with the publication of OCW's 1,800th course, set a standard for sharing of open educational resources and inspired a global movement.

More than 250 universities have committed to openly publishing course content in the OCW model and there are now more than 100 live sites and materials from over 9,000 courses available. MIT is clearly recognized as the global leader in what has come to be called the Open Educational Resources movement.

The cost side of the equation

Less well known is the effort and associated expense (nearly $4 million per year) required to maintain the relevance and vibrancy of OCW — with new courses, updates to existing courses, and other improvements to the Website — and to distribute the content worldwide.

The level of effort required to maintain and improve the OCW publication is not readily apparent. At first glance, OCW may appear incidental, a simple posting of materials already prepared for MIT students on an open platform. However, the fact is that the materials used internally at MIT exist in a wide variety of formats and include significant amounts of content that for copyright or privacy reasons cannot be included in the external publication.

To collect and reformat the materials, clear restricted content, and ensure a quality publication without significant impact on faculty time requires a dedicated OCW publication staff. Three OCW publication managers and five department liaisons currently provide primary support for participating faculty across MIT, a staff size that has kept the time commitment of publishing a course below five hours for most faculty [OCW 2007 faculty survey]. This team allows MIT to publish OCW course materials at both high volume and high quality, maintaining a landmark open educational resource.
To date, this effort has been funded by a combination of grant funding (41% of FY 2009 expenditures and 72% of total OCW expenditures since inception), Institute funds (49% in FY2009 and 22% of total to date), and donations and other revenue (10% in FY2009 and 6% of total to date).

In the next two years the grant funding that has supported OCW since its earliest stages will run out, and foundations generally do not provide new funding to support ongoing operations. Meanwhile, Institute funding has become tighter with the financial downturn, and like all units at MIT, OCW is under pressure to further reduce its reliance on the General Institute Budget. In the current economic climate, it is increasingly difficult to attract corporate support. Accordingly, OCW must develop new ways of financially sustaining the program.

A multi-pronged approach to financial sustainability

OCW has been hard at work to ensure long-term financial sustainability. Key components of the effort include reducing our costs, increasing donations, and implementing approaches to enhancing the revenue we generate to support OCW.

On the cost cutting front, OCW reduced its base operating budget by $500,000, or 12%, from the original FY 2009 of $4.1 million. In the wake of the economic downturn, OCW reduced spending by cutting certain staff positions, reducing technology expenses, and shaving costs in many other areas. Key elements of technology savings included taking advantage of free video hosting on YouTube for the expanding collection of highly popular video materials, moving video production in-house, and renegotiating contracts with some of our technology service providers.

OCW already has a modest but growing online visitor donation program, which generated just under $150,000 last fiscal year, an increase of more than 50% over the prior year. Additional improvements and experiments with new approaches for online fundraising and donor stewardship are in the works.

In FY 2010, OCW will be piloting other fundraising approaches, including a “Course Champions” campaign targeted at individual donors of $5,000 per year and a corporate underwriting program in the style of National Public Radio. More traditional fundraising is also part of the sustainability plan. The Resource Development Office has recently appointed a leadership gifts officer who will be providing part-time support to OCW for major gift solicitation.

OCW already derives modest income – about $30,000 per year – from referral links to Amazon.com. Over the last six months, an ad hoc Working Group of faculty and senior administrators has been exploring much more significant opportunities for generating new revenues. Proposals for generating revenue based on OCW are also reflected in the Institute-wide Planning Task Force Report. These ideas include various types of certificate, credit, or degree-granting distance education programs that rely on the OCW materials. At this writing, a pro bono team from management consultants Bain & Company is helping us assess the Working Group's ideas in terms of their potential for financial return, alignment with OCW’s core principles as well as the perceptions of OCW’s stakeholders and users, and the cost of implementing those ideas. We expect that a similar consideration of the ideas from the Institute-wide Planning Task Force will occur.

Staying ahead of the (learning) curve

Sustaining the value of OCW and MIT’s leadership position in open education requires more than just “keeping the lights on.” As new technologies develop and user expectations shift and grow, a digital resource like OCW will become increasingly less valuable if it does not innovate and grow along with these expectations. This requires updating materials on the site and adding new features that provide even greater global benefit. To ensure benefits here at MIT, OCW must also remain relatively up to date with the curriculum used in the classroom.

From 2003 to 2007, at the rate of around 400 courses a year, OCW published a “snapshot” of nearly every Institute course as it was taught in a particular semester by a particular faculty member. Since completing the initial publication, OCW has scaled back its effort and staffing and now publishes 130 updated versions of previously published courses and 70 new courses each year. Altogether, OCW has updated 600 previously published courses to date. In addition, OCW has added innovative new features such as the Highlights for High School section, which seeks to inspire the study of science, technology, engineering, and mathematics subjects at the secondary level. OCW is also actively exploring the use of social media (such as Facebook), mobile platforms (such as the iPhone), and partnerships with for-profit and non-profit groups that will extend the reach and impact of OCW.

No single sustainability approach will fully meet OCW’s future funding needs, but the goal is that by FY 2012, a combination of cost containment, fundraising efforts, and new revenue streams will provide the support needed to sustain OCW as a premier open educational resource for MIT and the world far into the future.

Part of making OCW successful in the future will be balancing the need to fund the core program as it currently exists with the opportunities to further expand and enhance the value of the materials we openly provide.

OCW will be holding a series of faculty forums later this academic year to discuss the present and future of OCW. We invite ideas from the community about the best way to sustain, and ideally enhance, OpenCourseWare.

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