Vol. 15 : No. 6
Editor's Note: Futurists such as Bart Fisher can guide us in the global development of e-learning. Bart has valuable insights into growth potential and markets for international e-learning. He addresses the use of languages other than English for specialized markets such as China.
Funding International e-Learning Projects
Bart S. Fisher
Much as e-learning has been a stepchild of the education industry, international e-learning has been a stepchild of the overall efforts to promote e-learning. The purpose of this article is to consider how international e-learning for countries and companies can be underwritten.
Let us go from the domestic to the foreign. Domestically, e-learning revenue of any sort has been a rara avis. In 1999, the entire for-profit education industry had $96 billion in revenue, but the e-learning sector accounted for just $500 million.  Nevertheless, in 1999 the e-learning startups garnered 40% of the private investment in the education field. That skewed investment was not lost on the public markets, which in 2000 brutalized the sector. While 50 IPOs were predicted in 2000, only about a half-dozen firms had made it through the IPO window, and even most of those are now trading at below their IPO price.
The markets are telling us that too many e-learning companies have been funded, and that not enough have produced results. It would seem that the market is on the verge of a consolidation, and only a handful of companies will survive. This fits the Gorilla theory of investment in the Internet field generally, where, like the automobile, the Internet game will be dominated by a few very large players. The task of the wise investor is to pick who will be the gorilla, instead of the monkey or the chimpanzee.
Electronic learning, however, remains a sleeper of an industry that can offer ripe opportunities for sharp investors. We will continue to see Fortune 500 companies increasingly using e-learning technology to reap big savings in employee training, and the industry is expected to grow to $12 billion by 2003. 
E-learning obviously has a lot of advantages, including the substantial savings over classroom-based teaching, the convenience of round-the-clock access for students, and the ability of the best, most effective teachers to reach a wider audience.  The Internet and e-learning are particularly compelling as extenders of human knowledge in the international context, conquering distance through its global reach.
Let us consider the following statistic. In the People's Republic of China, with its 1.3 billion people, only 1 out of 10 qualified high school graduates has a place available in a college in China. There is an absolute scarcity of higher public education opportunities in China, all the way from college through the graduate schools and the professional schools. Would it not be wonderful if the educational opportunities being afforded by distance learning, and e-learning in the United States could be available to the Chinese people? It is not difficult to imagine that educational exchange promoted over the Internet could be an essential part of a U.S. policy towards China of massive engagement by our countries and peoples, perhaps lessening the misunderstanding recently demonstrated during the spyplane episode and the Chinese reaction. E-learning made available to the masses could force the Government of China to make a painful choice between denying the educational opportunities required by its people to compete in the world marketplace, and screening out the information from the outside world that might undermine the aging gerontocracy that now runs China. When considering applications of the Internet in China, one is never far away from the political issues involving control over content. It is the desire, so far successfully implemented, by the Government of China, to screen what the people of China can see on the Internet.
The opportunities to open China up through e-learning are becoming greater, as more and more Chinese learn the English language. Currently 200 million Chinese are studying the English language - it is effectively their second language. How many Americans do you think are studying Chinese, and for how many Americans is Chinese their second language? Despite what some of the media and right-wing Republicans would have you believe, we are witnessing the Americanization of China. The younger generation in the Middle Kingdom wants to go to the Hard Rock Café, work for large corporate salaries, and get rich. They are following the dictum of Deng Xiao Peng, "To Be Rich is Glorious." E-learning, properly structured, could have a fantastic future in a China that is becoming increasingly wired. While there are only 12 million Chinese using the Internet now, the growth in the usage of personal computers in China is exponential. PCs basically fall in the fourth wave of appliances for the Chinese people, following TVs, refrigerators, and air conditioners. It is anticipated that Chinese will be the most used language on the Internet by 2007.
E-learning's greatest selling points - its flexible, round-the-clock online access to any number of courses - makes it particularly attractive to multinational enterprises. But to reap the benefits of international e-learning, three issues must be conquered, language, localization (which I would also call the culture issue) , and the lack of local infrastructure, or logistics. 
With regard to language, the problem now is that many companies offer courses only in English or in English and one other language, usually Spanish. An English-only focus works for them, because they conduct their business all over the world in English. But others need courses in more than one language. 
Companies that want to offer courses in several languages usually turn to translators. GE, for example, relies on translation companies to offer Web-based courses in English, French, German, and Japanese. But it is not enough just to convert a course from one language to another.  Globalness requires localization or ways to ensure that the learning makes sense in the local context. For example, the same word "nurse" may mean something different in China from its usage in the United States. We just witnessed the exhausting contest of wills over the single word "apologize" in the Chinese spyplane incident.
Cisco Systems is an example of a company that has done a good job in implementing global e-learning. About 5 years ago, the company was doing 80% of its training in instructor-led classes and 20% in a technology-based format. Now that's reversed, with 80% of the company's training via the Internet and 20% in the classroom. 
Cisco has a centralized pool of courses customized for specific regions of the world and individual students. The Cisco Networking Academy Program trains hundreds of thousands of high school and college students around the world, offering courses in 11 languages via software from Lionbridge Technologies Inc.
Aside from the language and localization issues, companies need to decide whether to post the E-learning content internally or use a hosting service. GE Capital selected the external hosting option, whereby employees connect to courses via a URL.
Arthur Anderson is another good example. It relies on global e-learning to train 77,000 employees in 83 countries. It uses English for most e-learning content. 
In developing countries, infrastructure issues abound. The infrastructure may not be what it should be, and there are serious bandwidth issues. That's because employees in some parts of the world have slower connection rates, as low as 9,600 baud. Browsers can also be a problem. In the United States, most browsers are equivalent to Internet Explorer 5, but for much of the rest of the world the norm is IE or Netscape 3.0 on a 486 computer.
Funding international e-learning projects requires answers to these 3 questions: language, localization, and infrastructure.
After the United States, what are the most likely international markets for e-learning? The obvious answer is Europe. The best estimates are that the European market for e-learning will reach $4 billion by 2004.  This would represent a compound annual growth rate of 96%. By 2004, IT-specific training will make up over half of that total. The rest will be soft skills training, which includes sales, marketing, and leadership skills. The strongest e-learning markets will be the United Kingdom, Germany, the Netherlands, and Sweden. 
It is those countries that have the strongest Internet adoption levels, feature large populations that speak English and are used to conducting business in English. In January, for example, Unext and the Open University Business School, the UK's largest academic institution, partnered to create an e-commerce course titled "Get the Net." Another example is The Financial Times' partnership with the Wharton School of the University of Pennsylvania and Michigan State University to offer executive education in an online format.
Where are the likely sources of funding for international e-learning? The first and most obvious sources of funding are multinational enterprises. It will obviously be a huge saver of corporate funds if training classes can be handled in the virtual context. This will save travel expenses, and allow for more extensive educational efforts by companies. Companies such as Cisco, GE, and Arthur Andersen will undoubtedly continue to funnel large amounts of corporate revenues for international training. Sylvan Learning Systems, for example, in December of 2000, acquired a controlling interest in Universidad de Las Americanas in Chile for $21 million. This is part of the overall effort of Sylvan to work through Sylvan International Universities, which operates four post-secondary campuses. With stakes in a number of North American key-learning companies Sylvan is attempting to expand its lead in the international arena through a series of investments in international ventures, including investments in companies in Latin America and Europe.
It is vital that in a country like China the foreign enterprise should work with a strong local joint venture partner. So I would recommend that any U.S. company wanting to enter that market should find a sound Chinese company to work with.
International organizations may also become involved, particularly in the context of developing countries. For example, it is now widely agreed that in Africa, which remains plagued by illiteracy and a lack of access to international learning material, e-learning could be the mechanism that enables this continent to successfully establish itself in the new world order.  Students in developing nations, isolated from each other more than developed country students, can use e-learning to share knowledge and experiences with each other as well as draw on the knowledge of the developed world.
A good example of an international organization becoming involved is the United Nations Development Program's (UNDP) Public-Private Partnerships for the Urban Environment (PPPUE).  This initiative offers a distance learning program where classes in participating universities are supplemented by international discussions and information exchange via the Internet.
The PPPUE also provides a website and an interactive database to store and access relevant documents and links.
The PPPUE project puts students and researchers in developing nations - China, South America, and Africa, directly in touch with each other. Common issues such as poverty, overcrowding, pollution, etc. can be discussed by students and researchers in the developing nations.
Apart from the United Nations, those seeking funding should consider the World Bank, and its private lending arm, the International Finance Corporation (IFC), the Inter-American Development Bank (now underwriting a project on the use of the Internet to facilitate the judicial system in Central America), and other public multilateral lending institutions.
Within the United States context, those seeking funding should also contact the Agency for International Development, and more particularly its Trade and Development Agency JDA), which would be reception to the creative use of e-learning projects for the developing countries.
Foundations are another fertile source of funding. The Pew Charitable Trust, for example, funded Freedom Fellows at the Georgetown University School of Foreign Service. The MacArthur Foundation, established by the eccentric Chicago insurance billionaire John MacArthur, should also be responsive to the issue of e-learning. Established foundations such as Ford and Rockefeller should also be approached.
Finally, investment banks and venture capitalists should be responsive to sound international e-learning projects. I mention them last because it seems to me that the inherent problem in seeking private VC funding for e-learning projects is that education has been perceived as a public good that should be obtainable at no charge. This mantra is uninviting to the venture capitalist, who wants to invest in markets that have a tradition of rewarding the suppliers of services. The United States has a long-standing tradition in favor of public schools, and we have learned the hard way that it is difficult to get people to pay for things on the Internet. The Internet bubble, however deflated it may be, should not necessarily drag down e-learning, which can take advantage of the Internet as the cheapest medium for information distribution.
E-learning is here to stay. International e-learning is the wave of the future. It can play a positive role in promoting education around the world and connecting peoples. Financing international e-learning projects, however, has its own special challenges. But what a worthy objective-finding funding for international e-learning projects is certainly worth the struggle.
 The information in this paragraph is from Stein, "VCs Go Back to the Drawing Board," Red Herring, February 25, 2001.
 Waschka, "Heard from the Buy Side: Investing in E-Learning," Red Herring, March 6, 2001.
 Gareiss, "E-Learning Around the World," TechWeb, February 26, 2001.
 The information in this paragraph is from "Europe to Move to E-Learning Quickly," E-Learning Advisor, www.advisor.com/Articles.nsf/aid/SMITT140
 Adams, "E-Learning Firms Cram for European Test," Red Herring, January 29, 2001.
 "E-Learning Can Level the Playing Field," sa.intenet.com,
 Information on the PPPUE is from id.
About the Author:
Bart S. Fisher is Chairman and CEO of CBQ, Inc., Counsel with the law firm of Porter, Wright, Morris & Arthur in Washington, D.C., member of the International Bar Association and ex-officio member of the Board of Governors, International Practice Section, Virginia State Bar.
He is a graduate of the Harvard Law School and the Johns Hopkins School of Advanced International Studies. He was elected to Phi Beta Kappa and was recipient of the Brookings Institute Fellowship in Foreign Policy Studies.
He was a participating member of the International Trade Working Group of the President's Council on Year 2000 Conversion. Recent publications include: "Let China in the WTO", The Washington Post, April 5, 1999, and "Regulating International Electronic Commerce," Proceedings of the Annual Meeting and Conference of the American Association of Law Libraries (July 19, 2000).
He can be contacted at CBQ, Inc. 1919 Pennsylvania Avenue N.W., Suite 500, Washington D.C. 2006-3434, p[hone: 202 778-3040 and Fax: 778-3063.