Excerpts

Funding Models for Open Educational Resources

Stephen Downes:

"What constitutes 'sustainable' will ultimately depend on the economies and the objectives of the provider. In this section, we see the this reflected in the multitude of funding and financing models. In some cases, direct funding is provided by organizations who see OERs as constituting part of their mission, while in others the free distribution of OERs may promote or support different objectives, including commercial objectives. In some cases, the resources providers themselves believe that the OERs are important enough to fund, either directly or through fund-raising efforts, while in other cases the resource providers are able to obtain the support of third parties. In some cases, funding is applied directly to operating expenses, while in others funding offers seed capital or even a sustainable endowment. Each of these approaches reflects the interests of the funding party, the needs and the motivations of the resource producers, the nature and expense of the project, and the level of funding available.

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As mentioned above, a variety of OER projects have been started in recent years. These have originated from governments, from foundations and organizations, and from groups and individuals. Each of these projects must be financially supported in some fashion, but no single model has emerged as predominate. This section reviews a variety of the models currently in use."

OER Endowment-Based Funding Model

"On this model, the project obtains base funding. A fund administrator manages this base funding and the project is sustained from interest earned on that fund. At the Stanford Encyclopedia of Philosophy, for example, where organizers reasoned that a subscription-based model would cost more than it would earn (because volunteers would have to be paid), funds ($US 3 to 4 million) were raised from a variety of charitable foundations, generating in interest the service's $US 190,000 operating budget." (Zalta, 2005) (http://www.downes.ca/files/FreeLearning.pdf)

OER Membership-Based Funding Model

"On this model, a coalition of interested organizations is invited to contribute a certain sum, either as seed only or as an annual contribution or subscription; this fund generates operating revenues for the OEM service. The Sakai Educational Partners Program, for example, is a for-fee community that is open to educational. Members contribute $US 10,000 and in turn are granted a set of privileges, including early access to roadmap decisions, code releases and documentation. (Sakai, 2005) Beshears (2005) describes how this model could replace user-pay models of textbook distribution." (http://www.downes.ca/files/FreeLearning.pdf)

OER Donations-Based Funding Model

"On this model, a project deemed worthy of support by the wider community requests, and receives, donations. Donations are in turn managed by a non-profit foundation, which may apply them to operating expenses or, if amounts are sufficient, seek to establish an endowment. Numerous open source and open content projects are funded in this manner, including Wikipedia (Foote, 2005) and the Apache Foundation. (Apache, 2005) It is worth noting that such donations are often supplemented with purchases of branded products; the Spread Firefox initiative is a good example of this. (Mozilla Foundation, 2005) Variations of this model exist. For example, contributions to the Apache project are owned by the contributor and licensed to the project. However, in another model (sometimes called the conservancy model), property is assigned to the organization, which then acts as a steward." (Everitt, 2004) (http://www.downes.ca/files/FreeLearning.pdf)

OER Conversion-Based Funding Model

"As summarized by Sterne and Herring (2005) "In the Conversion model, you give something away for free and then convert the consumer of the freebie to a paying customer." This approach, they argue, is needed because "there is a natural limit to the amount of resources the Donation model can bring to an open source project, probably about $5 million per year." Linux distributors, such as SuSe, RedHat and Ubuntu, where the software is available for free under an open source license, have adopted this model. Subscribers receive services (such as installation and support) or advanced features. In the educational community, the conversion model has proven popular, having been adopted by Elgg and LAMS." (http://www.downes.ca/files/FreeLearning.pdf)

OER Contributor-Pay Based Funding Model

"Adopted by the Public Library of Science, the `PLoS Open Access Model: One Time Author-Side Payments' (Doyle, 2005) consists of a mechanism whereby contributors pay for the cost of maintaining the contribution, and where the provider thereafter makes the contribution available for free. Interestingly, this is a model that has earned some support from publishers, particularly in view of foundations, such as the Wellcome Trust, that have begun to require that materials funded be freely available. Thus, in the 'open choice option' offered by publishers, "research articles and supporting documentation will be made freely available online to view immediately upon publication. The charges for this process will be met by funding bodies, such as the Wellcome Trust - who calculate it will represent approximately 1% of their annual spend." (Wellcome Trust, 2006) (http://www.downes.ca/files/FreeLearning.pdf)

OER Sponsorship-Based Funding Model

"This model underlies a form of open access that is available in most homes: free radio and television. The sponsorship model can range from intrusive commercial messages, such as are found on commercial television networks, to more subtle `sponsorship' message, as are found in public broadcasting. In online educational initiatives, various companies have supported OER projects on a more or less explicit sponsorship basis, often in partnership with educational institutions. Examples include the MIT iCampus Outreach Initiative (Microsoft) (CORE, 2005) and the recently announced Stanford on iTunes project (Apple) (Stanford, 2005) It is worth noting that GNU EPrints adopted this model as a direct result of a move by Research Councils UK to mandate open access for all funded research. (Yeates, 2005)" (http://www.downes.ca/files/FreeLearning.pdf)

OER Institutional-Support Based Funding Model

"A variation, perhaps, on the sponsorship model is the case in which an institution will assume the responsibility itself for an OER initiative. Probably the most well known of these is MIT's OpenCourseWare project, where funding for the project represents a part of the universities regular program, justified as constituting a part of its organizational mission. "It is an ideal that flows from the MIT Faculty's passionate belief in the MIT mission, based on the conviction that the open dissemination of knowledge and information can open new doors to the powerful benefits of education for humanity around the world." (MIT, 2005) (http://www.downes.ca/files/FreeLearning.pdf)

OER Governmental-Support Based Funding Model

"Similar to the institutional model, the governmental model represents direct funding for OER projects by government agencies, including the United Nations. Numerous projects sustained in this manner exist, for example, Canada's SchoolNet project." (http://www.downes.ca/files/FreeLearning.pdf)

OER Funding Models Based on Partnerships and Exchanges

"Though perhaps not thought of as a funding or financing model, partnerships and exchanges nonetheless play an important role, or potential role, in the development of OER networks. Partnerships depend not so much on exchanges of funding as on exchanges of resources, where the output of the exchange is an OER. For example, at a recent UNESCO conference an Open Source Congress was proposed, which "would be a voluntary, collaborative effort by interested higher education institutions to lend their expertise - both technical and functional - to begin the high-level design and planning for what will become the next-generation, open source, administrative systems." (UNESCO, 2002) Such partnerships are often more or less ad hoc and bilateral; examples include that between Memorial University of Newfoundland and The Federal University of CearÃ¡ UFC in Brazil (Barreira, 2002) and even the International Fellowships at the Open University. (OU, 2006) (http://www.downes.ca/files/FreeLearning.pdf)

Models for Sustainable Open Educational Resources

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