Business Models / Funding Models
There are a range of different business models that support the creation, management, and release of OER. These models are usually linked to both the original intentions behind such a 'service' and by the funding mechanisms. Business models need to be flexible, to respond to changes that can happen very quickly, and sustainable. Many existing OER services were established with 'one-off' initial funding and based on an altruistic notion of opening resources worldwide and sustainability has become a significant issue in recent years. Several services have developed strong communities which come together through sharing both practice and resources, which helps to sustain and support continued development of OER.
The Good Intentions report (click!) examined a range of business models for sharing learning resources (ranging from international, national, institutional, sectoral, subject discipline) and found that many were in transition towards adapting their models towards more openness. This study looked at the business models from three aspects or sub-models:
- Financial models. The various financial models could be said to shape the resulting services but are also the element of a business model which needs refining as services go through various stages of maturity. Clearly finance models are closely linked to sustainability of services.
- Service models. Crucial to all service models is an understanding of the market. If the service model is about the “route to market” it stands to reason that we should know the market. Often there may be several tiers to a market – the primary group/community to which the service is closely modeled and also possibly secondary markets (either known at start-up or emerging through queries/use) that the service can serve. This may affect future development and funding models if the new market is prepared to be involved in funding/contributing in some way. One outcome of developing OER for specific markets (or groups of stakeholders) is that resulting resources may not be accessible, either technically or pedagogically, for wider groups to use.
- Supplier/Consumer models. In relation to sharing learning resources, suppliers and consumers may often be from the same sector, community or group. In reality there are so many different contexts in which OER are used as well as such variation within a group that even within one department of one institution it is not easy to develop a generic model. The groups that are contributing may not actually be consuming; consumers may also be suppliers but not necessarily.
All of these sub-models are affected by some overarching issues which include: issues around competition and choice; variety and range of stakeholders; sustainability; adaptability and flexibility of model to change; partnerships and networks. (Source)
Stephen Downes (2007) categorises nine different funding models or OER initiatives, which are described as follows:
- Endowment models: The initiative receives base funding
- Membership models: Each partner organisation contributes membership fees.
- Donation models: The initiative receives donations.
- Conversion models: Fee payments are made by users/consumers.
- Contributor-pay models: The contributor pays for the cost of maintaining the contribution and the provider makes it freely available.
- Sponsorship models, such as commercial advertising.
- Institutional models: The initiative is funded internally by the institution.
- Government models: The initiative receives direct funding via government agencies.
- Partnership or exchanges: The focus is on sharing and exchanging resources.