Study reveals trends in ed-tech spending

Wireless laptop carts and online courses will be among the hottest high-tech sellers in schools this year, according to a nationwide report released Sept. 28 by market research firm Quality Education Data Inc. (QED). Overall, K-12 schools will spend more than $7 billion on new technologies over the next 12 months, the study states.

Mobility and flexibility are the standouts in the 10th installment of the company’s annual Technology Purchasing Forecast. Still struggling with waning budgets, administrators are looking for ways to save money while exploring options for more customizable, individualized instruction, research suggests.

“Schools are tapping into flexible mediums such as the internet and mobile computers to extend technology’s reach into classrooms more than ever before,” said QED President Jeanne Hayes. “These applications enable districts to bring more education resources to more students in a convenient and cost-effective manner.”

The results of the QED report are consistent with findings in at least two other independent studies. Market Data Retrieval, which plans to release its annual Technology in Education report later this week, estimates schools will spend more than $3.3 billion on hardware solutions alone this year. In its own analysis, technology research firm International Data Corp. (IDC) attributes school IT spending to a growing interest in one-to-one computing and an increase in wireless network installations.

Shawn McCarthy, technology analyst and author of IDC’s “U.S. Education IT Spending 2004-2005 Forecast,” pegged schools’ attention to wireless on falling hardware and infrastructure costs. Unlike the laptops of a few years ago, he said, most schools today can get a wireless-equipped machine for under $1,000. Though many elementary and middle schools might prefer to keep younger students on traditional desktops, he said, clearance prices are encouraging more high schools and colleges to make the switch to mobile devices.

According to QED, nearly 14 percent of all computers in K-12 schools already are equipped for wireless networking–with 23 percent of schools planning to integrate wireless in the near future.

Though most schools still are too poor to provide a laptop computer for every student, many are exploring innovative, more cost-effective ways to work with the mobile devices, research suggests.

According to the QED survey, 67 percent of districts are planning to purchase COWs, or computers on wheels, mobile storage units that house a selection of wireless laptops for use throughout the building–placing COWs atop this year’s school-technology procurement list.

For most cash-strapped schools, Hayes said, the wireless carts are a cost-effective alternative to one-to-one laptop programs and other multimillion-dollar initiatives. “Flexibility can also be looked at as a cost savings,” she said. Using the mobile carts, administrators can get the machines into the hands of more students–without spending beyond their means to do so. “Like a business,” Hayes said, “schools are using technology to improve costs. … It’s all about return on investment.”

Online courses also are experiencing a boom. In 2004-05, 41 percent of all K-12 schools will offer some sort of virtual learning option for students, the survey said. That’s a jump of 10 percentage points from the previous year. Hayes said the popularity of online courses shows how much educators are embracing the internet to help meet students’ needs.

As schools become more reliant on virtual learning tools, research suggests creative administrators are finding ways to speed up the network on the back end while keeping operating costs to a minimum. That includes migrating to free or low-maintenance operating systems, including open-source Linux and Unix servers, the study said.

Though Windows- and Mac-based machines still dominate in schools–with Windows NT, 2000, and 2003 used in 86 percent of buildings and the Mac OS 9 and 10 operating systems found in 34 percent of all K-12 institutions nationwide–many schools are at least beginning to experiment with Linux (19 percent) and Unix (9 percent) on their servers, the survey said.

Overall, technology spending in schools is projected to remain flat compared with last year, with districts spending upwards of $5 billion on hardware and software purchases, plus another $2 billion in infrastructure and wiring provided through the federal eRate program, according to QED.

The lion’s share of that money (63 percent) will be spent on instructional technology, including hardware devices. According to the survey, schools will spend an average of $53.72 on hardware per student in the 2004-05 school year–or approximately 38 percent of the average total per-pupil technology expenditure.

Besides computers, some of the most popular devices now in schools include digital whiteboards (47 percent of schools own these), video-streaming technologies (39 percent), voice-recognition tools (28 percent), and tablet PCs (10 percent). Voice-over-IP technology is also on the rise. Nearly 20 percent of schools surveyed said they currently use voice over IP, and another 20 percent reported they were evaluating the technology for future use.

The data-tracking requirements imposed by the federal No Child Left Behind law also will receive significant attention from school budget offices this year. It’s estimated that schools will spend 21 percent of their technology funds on advanced administrative and enterprise tracking tools, including NCLB-related software.

Eight-eight percent of districts have student information systems in place to help them meet the goals of NCLB, and 34 percent report they plan to upgrade those systems. Only 12 percent of districts said they had no such technology in place.

“The expected surge in assessment software to meet NCLB requirements has finally been reflected in planned purchasing for 2004-2005,” wrote the study’s authors. “However, instructional software and instructional management software are also planned for purchase/upgrade by three-quarters of all districts surveyed, a dramatic figure.”

But NCLB is doing more than fueling school software purchases, according to QED. The sweeping federal law has had an enormous impact on who actually makes the purchasing decisions. This year, more than 98 percent of schools’ technology expenditures likely will come from the district budget, while less than 2 percent will be decided on at the school level, the study found.

The move toward more centralized decision-making in schools has been occurring gradually since NCLB went into effect in 2001. With an increased focus on performance and state standards, Hayes said, there is intense pressure to make sure all schools throughout a given district or state make similar choices in terms of solutions. In fact, this year saw a dramatic drop in the number of individual schools that are allowed to make technology purchases autonomously. According to the survey, just 20 percent have the authority to make purchases independent of other schools in their district, compared with almost 29 percent of schools in previous years.

In this way, Hayes said, NCLB really has changed how schools approach technology purchasing.

“The Technology Purchasing Forecast indicates that more school districts are purchasing common applications and tools for use with administrators, educators, and students alike, which is very similar to purchasing decisions made by businesses in the private sector,” she explained.

QED reports that schools receive about half of their funds for technology purchases from the local sources. The rest reportedly comes from state (22 percent) and federal (28 percent) grant programs, including 8.5 percent from the eRate.

Other statistics of note:

  • Technology outsourcing is on the rise in schools. Schools went from outsourcing 15 percent of their IT functions in 2003-04 to 16.2 percent in 2004-05, the study found.
  • In terms of software purchases, three-fourths of districts are in the market for new applications or upgrades, including student information systems, instructional management software, and assessment software. Special-education management software is planned for purchase by 35 percent of districts, the study found.
  • Looking ahead to next year, 52 percent of survey respondents said they expected their technology budgets to remain flat in 2005-06, while 24 percent expected an increase in spending and 22 percent anticipate a decline in spending.


Quality Education Data Inc.

International Data Corp.

Market Data Retrieval

eSchool News Staff

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