One of the world’s largest higher education sectors, India is home to over a thousand universities, 42k colleges, 11k standalone institutions and a college-age population—which is set to grow—that bolsters this system. India’s college-age population will reach 126 million by 2026. Even then, its higher education enrolment ratio lags behind China and Brazil.
The Indian government’s goal is to increase the current ratio of 26% to 50% by 2030, making high-quality online education a priority. And Aussie EdTech company OpenLearning (ASX: OLL) is up to the challenge.
The Company has signed an exclusive Distribution and SaaS Reseller Agreement with the Education Centre of Australia (ECA) to expand its business operations to India. OpenLearning India will comprise Company’s SaaS platform and a marketplace of short courses, micro-credentials and online degrees primarily from Indian and Australian universities.
OpenLearning Group CEO & Managing Director Adam Brimo said, “Our partnership with Education Centre of Australia to launch OpenLearning India marks an exciting new chapter in the Company’s growth, as we expand our reach to one of the world’s most dynamic and rapidly growing education markets. By working with ECA, we will be able to enter the Indian market with a capital-light model while creating new opportunities for our existing partners in Australia and Southeast Asia who may want to gain access to a new market.”
The agreement will be subject to performance thresholds that ECA will have to meet after the first three years.
The Company will require minimal investment to enter the country, and the ECA will handle sales, marketing, partnerships, course design and distribution of OpenLearning’s SaaS Platform. OpenLearning, on the other hand, will establish, operate and provide technical support for the platform hosted on Microsoft Azure in India.
ECA Group CEO, Rupesh K. Singh, commented, “We are excited to utilise OpenLearning’s platform to support ECA’s expansion strategy in India. Over the past two decades, ECA has built a sales and marketing network across dozens of countries and we have extensive experience in India and across South Asia. We look forward to working closely with OpenLearning to leverage our experience and resources to expand OpenLearning’s platform and marketplace to India.”
The Company will receive 5% of the gross enrolment fees and any other fees ECA receives by students for its OpenLearning India marketplace. ECA will also try and sell its services to Indian universities, with ECA and OpenLearning getting a 50-50 share of subscriptions.
If ECA generates less than $100,000 in revenue after three years, the Company can terminate the agreement.
In FY22, OpenLearning’s Platform SaaS revenue increased by 15% on FY21 to $1.644 million. That said, its program delivery revenue declined by 36% due to fewer international students expressing interest. Though it doesn’t know how much revenue this new agreement can bring—because it is solely dependent on how many Indian students use it, there is plenty riding on this deal considering the Company’s results.
Besides India, ECA also plans on promoting the OpenLearning marketplace to universities in Nepal, Sri Lanka and Pakistan.
Alinda is a Business Reporter for The Sentiment
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