School spending on computer hardware and other educational technology will increase slightly in 2001, but spending on assessment, test prep, and professional development solutions is expected to soar, according to a report released in August by an education market analysis firm.’s report, called “Markets and Opportunities 2001,” analyzes what happened in 2000, predicts future school-spending trends, and projects growth in key education segments.

Eduventures expects overall K-12 spending to grow by 14 percent in 2001, but school spending on technology will grow by only 2 percent, the firm predicted.

“What you will see is a stabilization of spending on K-12 technology,” said Tom Evans, director and senior analyst at Evans attributed the leveling off to the “large influx of technology in schools over the past few years.”

In 2000, K-12 technology revenues grew 2.5 percent to reach $8 billion. But technology purchases funded directly by schools themselves actually decreased by 7 percent, as districts relied more heavily on eRate discounts and as spending on Y2K readiness no longer was needed.

2002 tech-related spending pegged near $15 billion

The firm categorizes technology spending separately from expenditures on testing, tutoring and test preparation, and professional development, which increasingly include technology components.

Viewing these categories together brings the firm’s spending projections to a little more than $13 billion for 2001 and to nearly $15 billion for 2002.

According to Eduventures, much of the growth in technology revenues in 2000 was a result of the increase in the available eRate funding. In 2000, eRate discounts increased to $2.25 billion from $1.7 billion allotted in 1999, an increase of 32 percent.

As for 2001, Eduventures expects K-12 technology revenue to grow by 2 percent to $8.1 billion.

“Absent funding initiatives from the federal government, K-12 technology spending will remain flat as districts digest expenditures made over the past five years,” the report said.

President George W. Bush’s education agenda–which hasn’t focused on technology, but rather on annual testing and increased accountability–instead will drive growth in professional development and testing software, Eduventures said.

“Tutoring and test-prep markets have been around [for a while], but as accountability measures increase, that industry is expected to soar,” Evans said, adding that government support has a large influence on how schools target spending.

School expenditures on tutoring, test prep, and assessment are expected to grow between 10 percent and 15 percent annually over the next three years, according to the report.

Expenditures on virtual schools also are increasing, Evans said.

“eLearning is gaining adoption all over the business industry, [and] it’s just a matter of time before it’s adopted more widely in the K-12 market,” Evans said. It won’t be long before more states and school districts start their own virtual schools, he said.

School technology leaders who spoke with eSchool News mostly agreed with the report’s predictions.

“I think these predictions are probably right on target, as schools and institutions put their efforts into effective use of the existing technologies in the schools to support teaching and learning, both for students and educators,” said Kathy Schrock, technology coordinator for the Nauset Public Schools in Orleans, Mass.

But, said Charlie Reisinger, technology director for the Penn Manor School District in Pennsylvania, “what I really think they missed as the ‘next big thing’ is online grading and reporting. Systems such as Lettergrade and PowerSchool are hot right now and will … revolutionize the way schools communicate with parents and students.”

Reisinger said his district currently is deploying Lettergrade, an online grade book and attendance package that will let parents and students access teacher grade books through the web.

“These types of systems will likely become extraordinarily commonplace,” he said.


Kathy Schrock

Penn Manor School District