As curricula commoditize, prices will fall and profits shrink

From: Samsung Cuts Its Forecast as Sales Growth Slows for Its Costliest Smartphones (New York Times, July 4, 2013)

Samsung Electronics may be having the same problem Apple has: nearly everyone in the world who can afford an expensive smartphone has one already.  But for Samsung, the real problem may be that much of the growth in smartphone sales in coming years will be at the lower end of the market, where Chinese manufacturers are gaining share. Samsung simply does not have the most appealing models for those consumers. As smartphones become increasingly commoditized, prices will fall and profit margins will shrink.

IMPLICATION:

While many academics question the relevance of business models when predicting academic transformation – instructional models are increasingly looking like – and behaving like business models.  The impact of cost-efficient instructional innovations, especially in the general education space, imply lower tuition rates ahead for postsecondary providers that cannot leverage unique benefits or high brand value.

 

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