Blackboard-WebCT Merger Highlights Growth of e-Learning Industry

October 13, 2005

Around 2001�I did extensive research into e-learning tools in connection with a consulting engagement for a client who wanted to publish a series of online courses. At the time, Blackboard and WebCT were two�of the�providers I investigated. In fact, I had actually used WebCT to create an online course even earlier, back in about 1999.

So I was intrigued today when our TMCnet news feeds received the announcement of the merger of Blackboard and WebCT.

Reading the release, I was astonished at the figures involved in this transaction, indicating impressive growth in the e-learning industry. Blackboard is paying $189 million for WebCT. The two companies together will boast a client base of 3,700 institutions globally. Blackboard, a public company (Nasdaq: BBBB), has a market cap of $620.5 million, a P/E ratio of 17.33 and a stock price of about $23, trending upward from about $14 throughout 2005. I'm no financial analyst, but this sounds like a good situation.

Briefly checking the two companies' web sites, I was also impressed at the level of professionalism and marketing savvy developed over the years�by both outfits, especially Blackboard. I remember when I was research e-learning providers just four years ago I was appalled at the poor communications skills exhibited by companies across the board in the e-learning space.

But now, checking the Blackboard and WebCT web sites, I see strong, detailed, benefit-oriented presentations -- and, one of the most important elements in software�marketing, visuals that actually show what the product looks like, how it works, and what the user experience is like. To their detriment, this basic visual element is missing on many technology-company web sites.

I'm also impressed by the degree to which�Blackboard and WebCT have developed their products into broad,�sophisticated�platforms for online learning, community and collaboration -- along with integrated e-commerce. Only about six years ago, I remember as a user being�discouraged by WebCT's rudimentary capabilities for designing an online course.

Obviously, things have changed radically in the e-learning space, with important implications for the technology-enablement of institutions of higher education, K-12 and corporate training programs. Congratulations to Blackboard and WebCT on their merger and for their amazing progress.

AB -- 10/13/05

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