EduBlogr - Blogging in E-ducation

Of the millions of blogs out there, probably only a few thousand are specifically devoted to education. This is one of them.

Monday, October 17, 2005

The future downside of M&A

John Hagel has another interesting post up at Edge Perspectives. He's looking at the bankruptcy this week of GM supplier Delphi. I wonder what cautionary parallel there might be to the Blackboard acquisition of WebCT?

Maybe nothing - GM and Ford have huge labor costs that factor into their poor financial performance, and they are locked in fierce competition with each other and foriegn manufacturers. Blackboard has miniscule labor costs in comparison, and enjoys market dominance now and for some time to come.

On the other hand, look a few years down the road. e-learning is new and just becoming a major player; it is not yet fully integrated into the culture. Perhaps it's a bit like the automobile industry in the 30's. Even if many people don't yet own a car, almost everyone has at least seen one. The number of people who have taken online classes is relatively small, but the idea of taking a class via the Internet is widely-known (if not universally accepted as "quality" education).

Through the Forties and Fifties, the auto industry continued to grow, and the automobile became part and parcel of American culture. If the e-learning pundits are right, that could - should - must - happen in this industry over the next fifteen years or so.

In the sixties, though, the industry began to stagnate. Serious competition from overseas surfaced in the 70's, and ever since then Detroit has been on the defensive, cutting costs like mad.

Forewarned is forearmed, they say.


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