During the general election campaign, Labour leader Tony Blair declared that his party had three policies: ?Education, education and education.?
Labour?s education minister, David Blunkett, promised to increase the number of computers in every school and the party pledged to enlarge bandwidth in the telecoms sector. The news should have had IT vendors salivating at the prospect of an expanding market, if it weren?t for the fact that once they are elected, political parties tend to deliver far less than they promised.
All the parties have had an on/off love affair with IT in education for two decades. The last Labour government initiated a #9 million project to bring computer education to schools as far back as 1978. The scheme was continued under the 1979 Thatcher government. But none of the #9 million was earmarked for equipment ? it went instead to training teachers in the use of IT. The Tory government appealed to the IT manufacturers to provide machines and software to schools in the form of donations.
In recent years the government has been spending #200 million a year on IT in schools. But since 1988, the number of students going into higher education has doubled from 15 per cent of school leavers to 30 per cent, making the need for computer investment even greater.
Software industry trade body the Computing Services & Software Association called earlier this year for more money to be spent on IT in the education sector ? a request echoed by Microsoft CEO Bill Gates.
Apple, Microsoft?s former arch-rival and now partner, has always been active in education. In the early days of computers, Apple and Microsoft fought a fierce battle for control of the education market. It would be churlish to suggest that this seemingly benevolent interest in the welfare of children had more to do with establishing standards than in education.
Borrowing the Jesuit principle, the operating system suppliers and manufacturers reasoned that if they could get children early enough, they would be theirs for life.
Even though Microsoft is one of Apple?s shareholders, the two companies continue to slug it out for market share. In 1996 Apple and Acorn, another long-term player in the educational field, set up a joint company, Xemplar, to sell systems to primary and secondary schools. Xemplar set up a nationwide network of agents, some Apple dealers and some formerly Acorn dealers. It deals with local education authorities and, by catalogue, with individual schools, selling both Acorn and Apple machines running Acorn?s Risc OS and Apple?s Mac OS respectively.
In May, Xemplar published a report written by Ian Carter, head of IT at Cheltenham College, which compared the merits of PCs with those of Apple Macs and the Acorn Risc PC. The report makes a number of claims that purport to show that PCs running Windows are less efficient than the Apple and Acorn offerings. Users of Windows PCs spend more time on maintenance, an average of 25 minutes a month, compared with just six minutes for an Xemplar machine running Risc OS, the report claims. It also states that Apple and Acorn machines have a longer useful life span than PCs ? Macs lasting seven, as opposed to three, years.
?Schools need to get as much benefit out of their purchases as possible. The UK can boast a computer access factor of 8.5 children per computer. However, more than 50 per cent of these computers are over five years old. Unlike industry, schools can ill afford to write off their hardware,? says the report. ?A six-year-old PC is fit only for the rubbish tip, only able to run software from the same era. By comparison, the software for Apple and Acorn systems is backwardly compatible.?
By setting up Xemplar, Apple in effect withdrew from selling to schools and instead concentrated its efforts on further and higher education.
?Xemplar took over our schools business last year. It knows the education business, has 40 or 50 specialists and sells through a network of agents,? says Kate Cruickshank, education business manager at Apple.
Apple itself set up an education alliance of dealers that sells into colleges and universities. According to Cruickshank, the company is the world?s largest supplier of hardware into the education sector.
Although Apple is particularly strong in the Scottish and Northern Ireland educational establishments, it is not the case in England and Wales. This is almost entirely due to the fact that in the late 1970s the Department of Education let it be known that it would prefer local education authorities and schools to buy British. The department?s writ runs only to England and Wales however, leaving Scotland and Northern Ireland free to purchase as they see fit. The main beneficiaries of the 1978 to 1981 policy of preferential purchasing were Acorn and Research Machines.
Apple, Acorn and the other suppliers involved in the education market face a challenge from Microsoft, which stepped up its activities in the education field in September by announcing an authorised education reseller (AER) scheme.
The aim of the AER scheme is twofold: to streamline the ordering and delivery process and to weed out dealers that were selling Microsoft education software to non-eligible customers. According to Mark East, education group manager at Microsoft, some resellers were ?manipulating the system to sell Microsoft academic editions to non-eligible customers while others were importing potentially counterfeit software and selling it as academic editions.?
The tightening up of the education channel strategy is an important move for Microsoft and its resellers. The academic editions of Microsoft products are about one-third of the price of the commercial packages, tempting to any reseller at a time when margins are cut to the bone.
The news of the tightening up was welcomed by resellers specialising in the education sector. ?Microsoft has set up a couple of schemes which will help them police the market. I have not yet seen the new contract, but I understand that it has a clause which allows Microsoft to fine dealers millions of pounds,? says Stephen Hedegaard, a director of Management Software.
According to Hedegaard, there is heavy demand in the education sector for Microsoft Office and NT Server. ?Microsoft is quite shrewd when it comes to pricing and it has pitched its prices at a level where it can offer support to schools,? he says. For example, Microsoft Office costs #170 for a single user licence, about #120 for a 10-user licence and a commitment to take 500 units over two years reduces the price to #80.
Microsoft has 1,000 dealers selling into the education market; some, but not all, are specialists. ?A lot of schools prefer to buy from a local dealer because it makes support easier. They can pop in to their local supplier if things go wrong,? says Hedegaard. But he stresses that dealers need to have some knowledge of the education establishments and warns that profit margins are low.
East says: ?The higher education market is not so bad. Universities operate like large corporations with a central IT system and individual departments purchasing whatever they require. But you do need to have an understanding of how the purchasing procedure in a university works.?
Although the education market accounts for 10 per cent of Microsoft licences, it only contributes six per cent of revenue.
The AER scheme also aims to improve the distribution process. In the past, dealers had to send a copy of their order from a school to their distributor as proof that they were genuinely supplying the education market. This process led to delays in order fulfilment, according to East.
?We are moving over to a basis of trust with our dealers,? he said. ?In the event that any of them are found wanting they will be refused permission to sell any Microsoft products.?
But all desktop PC suppliers face a challenge in the future from network computer (NC) vendors. Robin Bloor, chairman and chief executive of consultancy Bloor Research, believes the NC will eventually oust PCs in most schools. ?I believe NC-type devices will eventually take over for the simplest reason: its battery life. It is impossible to wire every desk in a school, and the hard disk on a PC drains the battery power. The other factor is that NCs are considerably cheaper than PCs,? he says.
Bloor points out that a battery powered NC could download applications from a single server in a school or from a regional and national server. While he admits that educational software products such as Microsoft Encarta are powerful aids to learning, he believes CD-Rom software will eventually be eclipsed by other devices.
?You can get Encarta on CD-Rom and that is reasonably impressive, but the potential of the Web makes Encarta looks weak,? he says.
He points out that the arrival of Encarta hit more traditional suppliers of educational material for the home and school. ?The Encyclopedia Britannica never saw Encarta coming and got creamed by Microsoft. Encarta took the ground from under its salesmen?s feet,? Bloor says. But the Encyclopedia Britannica is fighting back with an interactive Web site and Bloor believes it will ?eventually snooker Encarta?.
East acknowledges that the NC has a role to play in the education sector, but does not believe it will be as all pervasive as Bloor suggests. He argues that there will there be a lack of bandwidth for some time to come, and if the server goes down, so will every computer in the school.
Cruickshank believes the NC will have an impact on education, although she feels it will be confined more to administrative tasks than as an education aid.
?In further and higher education, the NC will have a great effect on the more mundane tasks handled by MIS departments, where security is of vital importance,? she says. ?Among students, it will be of limited use except in certain areas such as libraries. Many students will still need a full multimedia computer.?
Although the further and higher education sector is becoming more corporate in its approach to IT, there is still plenty of departmental freedom. Engineering departments will probably opt for a Unix workstation as a standard platform, while a media studies department would choose a Mac and other departments would use PCs. Standardisation, much talked about everywhere, is not practical in the education sector, believes Cruickshank.
Although the government has promised to increase spending on IT in schools, colleges and universities, no new money was made available in Labour?s first budget. But those involved in education are confident that next year?s budget will see more money made available to fund IT in the sector.
Profit margins in the provision of IT to educational establishments are small, but the volumes are potentially huge, and the sector remains fiercely competitive. Some general dealers may pick up a few crumbs, but it is education specialists that will eat most of the cake.
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