Sector reports losses as EdTech tries to ride the storm
It won’t make much of a difference to many people’s lives to know that some of the mainstream education publishers and companies reported heavy losses in their share prices this week.
Similarly there are few violins being played for some of edtech’s biggest players, who have found some of their innovations reduced to yesterday’s news in the space of a couple of days.
Organisations such as Pearson announced trading losses, while US edtech company Chegg, which provides online writing and maths assistance to students, reported that hundreds of millions had been wiped off the valuation of the company as its share prices was almost halved. The organisation announced recently how ChatGPT had been eating into its customer growth forecasts.
As with many industries, some have found it difficult to tell about the long-term effects of the AI on the industry, but the implication remains clear: “Why bother buying a textbook, when you can ask ChatGPT to give you the answers?”
It’s a conundrum that doesn’t affect those outside full-time education or the education industry, but in the short-term people and companies in these sectors are finding it difficult to see how a world of in-depth research, essay writing and revising can coexist with disruption by an ever-improving AI platform.
Adopting and adapting
Pearson has tried to quell worries about its viability by stating that ChatGPT runs by comparing rich datasets, many of which Pearson owns. The company also has partnerships with a variety of courses and exams, which require the use of its course-specific material and publications.
ChatGPT can provide the answers to the questions posed to it by users, but not by those using Pearson’s products at that specific moment. To put it another way, Pearson owns the product that provides the questions – AI provides the answers.
“To put it another way, Pearson owns the
product that provides the questions –
AI provides the answers.”
Still, many companies have tried to ride the AI wave and build these functions into their products. Chegg has been incorporating its own language model into its software using ChatGPT and Duolingo has also been testing it out. A paid-for subscription was launched last month for those who want to experience conversational experiences on the platform.
In a week that also saw the “Godfather of AI” quit his role, and amid the ongoing argument (and seemingly very little sign up) asking for a pause on AI development, it seems the disruption for other industries will continue until they’re forced to adapt, or disappear.