Good Economic News?

While the news of 3.5% growth in the third quarter of 2009 is encouraging, a full recovery is quite a ways off.  The most recent  national unemployment rate estimate is 9.8% (seasonally adjusted). As Krugman notes in his blog yesterday, at the current growth rate, it will take about a decade for the unemployment rate to return to something approximating full employment. A Taylor rule policy would keep the Fed at a near-zero interest rate target for the next 6 years.

Unless the pace of economic growth rises, it’s going to be a slow recovery. The last two recoveries were referred to as “jobless recoveries” because unemployment started to improve long after real GDP growth rose. If this occurs again, the economic climate may not feel much better for a while.

… and we wonder why economics is still called the dismal science…   It is, though, at least a bit less dismal than in the days of Ricardo and Malthus

The death of competition in learning management systems?

Yesterday, Blackboard and ANGEL Learning announced that Blackboard has acquired ANGEL Learning systems, its last major competitor.  In 2001, Blackboard had acquired Prometheus; WebCT was acquired by Blackboard in 2005.

From the standpoint of Blackboard, this merger makes a great deal of sense. In 2008, Blackboard’s market share in community colleges fell rather dramatically (I have not yet found statistics for other colleges and universities). The proportion of community colleges using ANGEL last year more than doubled, while the proportion of community colleges using Blackboard fell by about 3 percentage points and the proportion  using WebCT fell by about 15 percentage points.  The reasons for this shift are fairly obvious: ANGEL is substantially less expensive, has been more responsive to the instructional needs of faculty, is easier to use, offers substantially more features, and has displayed a remarkable record of innovation. ANGEL has been somewhat unique in providing new releases every year that include substantial product improvements and enhanced functionality. The only other company with close to a 5% market share is Desire2Learn, which has had its growth hampered by Blackboard’s lawsuits.

This move also makes sense for Indiana University-Purdue University Indianapolis, who will be the largest recipient of the $95 million purchase price. The current recession has seriously damaged the budgets of most colleges and universities. This sale represents a convenient windfall in a time of very tight college and university budgets.

Will the Obama Justice Department allow this further reduction of competition in the LMS market? If you would like to voice an opinion on this, give the Networks and Technology Enforcement Section of the Justice Department a call at: 202-307-6640.