One possible framework for cost analysis

Bates (2001) provides a sample schema for analyzing costs for an online course or program development process that includes the following elements that require cost analysis.

  • Planning
    • Including time and effort costs required for meetings and development discussions
  • Program administration and overheads
    • Including time and effort costs required to use institutional systems and processes for the development, delivery, assessment, and certification of the course
  • Development
    • Including time and effort costs for faculty to develop content, media to be produced and mounted on the online course delivery system
    • Including time and effort costs for custom software development
  • Maintenance
    • Assuming the course will be maintained and delivered again to help amortize overall development costs
  • Delivery
    • Including license, time, and effort costs associated with the operation of the technical platform on which the course was delivered

Intangibles and variables in the model include the calculation of faculty costs in the development and delivery process. However,  ‘targets’ are often set for faculty workload and are included in their tenure costs. In the Bates model the aim was to make sure the teaching load for a fully online course was no more than that of a face-to-face course for a tenured professor. The target was also influenced by experience from earlier online courses concerning the faculty time needed for these kinds of courses.

COL cost analysis

From documents provided to COL by IIT Kanpur the following conclusions were drawn:

  • COL provided a total of C$15,000, which was converted into Indian Rupees.
  • The bulk of the course costs (just over 75%) were incurred in content development, including costs of recording and editing of instructional videos.
  • The IITK team provided support for server management costs, which was actually a substantial contribution although they, as a public institution, had not placed a monetary value on IT support

In terms of COL’s contribution, the Director, Technology & Knowledge Management contributed about five percent of his time of his time to the project and COL hosted the home page of the course, on its server at an annual hosting cost of USD $120.

Other IIT Kanpur costs

The IITK team had full administrative privileges on the server and the IITK team added to this a secure and reliable registration system from which they transferred data in a secure way to the online class site,

The transfer process was developed exclusively for this course by IITK, since it involved transfer from Drupal to Sakai for which there are no known solutions.

This has software development process has not been assigned a cost by IITK.

Reviewer comments

A clear need for future iterations of the M4D course and similar courses that may be considered for development by COL and IIT Kanpur, is the need to use a consistent cost-analysis framework that would account for all costs.

Based on the available data for the M4D course, the investment of C $15,000 and the USD $120 hosting costs for the server were the only tangible costs that could be provided for this review.

Bates (2011) noted that faculty time and effort required for development of materials and instruction tend to be the major costs required for online course delivery. Therefore the total costs for development and delivery of the M4D course could be estimated by assigning an hourly rate to the efforts of faculty, media staff and technical staff. Using this method and an estimate of hours invested by each would provide an approximation of the total cost for development and delivery of the M4D course. These costs could be estimated retrospectively to produce a benchmark metric for future development.

The literature on MOOC development provides estimates of course development and delivery costs between USD $50,000 and $250, 000 for a single instance of a large-scale MOOC. These cost estimates suggest that even with limited cost data available that the M4D course would likely be at the low end of the cost scale for development and delivery.


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