What the edX Acquisition Means for the Future of Higher Education

Traditional universities and colleges need to commit to one of three strategies.

by

and

Luminita Enache

by

and

Luminita Enache

July 15, 2021

Thomas Barwick/Getty Images

Summary.

In a recently announced transaction, 2U will acquire all edX assets, including the brand, about 3,500 digital courses, and the website — with its 50 million learners. This development should serve as a wakeup call for other colleges and universities, which must start thinking about how to unbundle the value chain and outsource areas where others possess superior core competencies By partnering and controlling significant parts of value chain instead of resisting them, universities can gain a significant portion of revenues that would steadily migrate toward EdTech companies. Those additional revenues can provide seed capital to universities to drive their own EdTech initiatives. Right now, they’re mere spectators in the game.

Tech company 2U recently announced an agreement to buy edX’s assets from Harvard and MIT for $800 million. How will this transform the business of education, and how can traditional learning institutions adapt?

Vijay Govindarajan is the Coxe Distinguished Professor at Dartmouth College’s Tuck School of Business, an executive fellow at Harvard Business School, and faculty partner at the Silicon Valley incubator Mach 49. He is a New York Times and Wall Street Journal bestselling author. His latest book is The Three Box Solution. His Harvard Business Review articles “Engineering Reverse Innovations” and “Stop the Innovation Wars” won McKinsey Awards for best article published in HBR. His HBR articles “How GE Is Disrupting Itself” and “The CEO’s Role in Business Model Reinvention” are HBR all-time top-50 bestsellers. Follow him on LinkedIn.
vgovindarajan
Anup Srivastava holds Canada Research Chair in Accounting, Decision Making, and Capital Markets and is a full professor at Haskayne School of Business, University of Calgary. In a series of HBR articles, he examines the management implications of digital disruption. He specializes in the valuation and financial reporting challenges of digital companies. Follow Anup on LinkedIn.
Luminita Enache is an associate professor at Haskayne School of Business, University of Calgary. She investigates financial disclosures of new-economy firms. Follow Luminita on LinkedIn.

What the edX Acquisition Means for the Future of Higher Education

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