When MIT and Harvard University started edX nearly a decade ago, it was touted as a nonprofit alternative to for-profit online course providers. Today, the universities announced that they are selling edX to one of those for-profit providers for $800 million.
edX had fallen behind rivals like Coursera, a similar platform founded by Stanford University professors, in fundraising and reach, though it still boasts 35 million users and more than 3,000 courses.
Leaders of edX cited the pandemic as a factor that led to the sale. “Covid drove an explosion in remote learning, which spurred huge investments into edX’s commercial competitors,” wrote MIT’s president L. Rafael Reif, in an open letter today. “This put edX, as a nonprofit, at a financial disadvantage. This new path recognizes this reality and offers a solution that allows edX to continue to support and maintain the key aspects of its mission.”
What happens now is a bit complicated.
2U, a so-called Online Program Management company that helps traditional colleges start and run online degree programs, says it will operate edX as a separate subsidiary that will be structured as a public benefit corporation. That means it will be for profit.
Meanwhile, the $800 million that 2U is paying for the assets of edX will be used to create a new nonprofit, as yet unnamed, that will maintain the open-source platform on which edX runs, called Open edX. The nonprofit will also “explore promising new ideas for making online learning more effective, engaging and personalized,” said Reif in his letter.
Editor’s Note: this is a developing story. Look for more details later today.