China’s Internet Giants Form A Powerhouse In Burgeoning Online Education Market

Jun 1, 2015
|By Emma Lee
3 min read

 

china-education

In a country as obsessed with education as China, it is strongly believed that online education will have great potential, especially in an age where private education is becoming more universal thanks to the education reform and improving economic status of Chinese people.

Over the past few years, China’s online education is experiencing massive growth in all verticals, including preschool, after-school tutoring, overseas study and vocational education.

Lured by the booming market, companies with different backgrounds, internet giants and offline private schools, flocked to the battlefield to build platforms to accommodate some or all sectors of the industry. Internet juggernauts BAT have been notorious for smashing up every trending field in tech and online education is no exception.

Alibaba

With a goal to sell all products on its online marketplace, Alibaba launched Taobao Classmate in 2013, allowing teachers, education agencies set up Taobao stores to sell recorded videos, offline courses or events on the platform. Last year, the ecommerce giant led a US$100 million Series B financing in language learning company Tutor Group and partnered with Peking University, one of China’s top universities, to launch Chinese MOOC Platform.

Baidu

Baidu began its foray into online education by introducing educational content into its in-house platforms. The company launched education portals in its online library Baidu Weku in 2012 to provide video courses, and then rolled out after-school tutoring platform Zuoyebang on Q&A site Baidu Zhidao. Later, the company built 91UP, a platform for education apps and online courses and wheeled out video lecture channel Duxuetang.

Moreover, the internet giant has make several investments and acquisitions in content provider or startups like Wanxue Education, Hujiang, Innobuddy and Chuanke, compensating for its shortage in premium content.

Tencent

Tencent, which is dominant in China’s social network and gaming markets, enabled monetized classes through its QQ Instant Messaging tool in 2013. The company also established a joint venture with New Oriental Education & Technology, a leading private education company, to develop educational apps and services.

China’s private education institutions have been actively seeking to ride the new wave of online education too.

TAL Education

TAL Education (NYSE:XRS), a K-12 after-school tutoring services provider formerly known as Xueersi, refocused to be a tech-oriented education service in 2010. Since then, the company start to make investments in a variety of online platforms.

The company’s investment head Yang Qiang once said that the public deals only account for a small number of current partnerships. The investment logic behind these deals is pretty clear—to cover education platforms for all age groups and interests among students. K-12 is still the core business where TAL is the primarily focus, while other sectors are developing through cooperation with partners.

New Oriental

New Oriental Education & Technology Group (NYSE:EDU), the Chinese behemoth in private education, has seeking new growth points through online education after witnessing decline in enrollment for offline schools.

New Oriental established online course site, Koolearn, way back in 2000. But the performance of the site isn’t impressive that it only had had 9.2 million accumulate registered users. Given the online education trend, New Oriental is planning to invest in US$25 million to 30 million in the market and Koolearn is expected to be a core platform to push forward the online transformation.

On the other hand, New Oriental distributes its contents online via cooperation with internet giants in a bid to gain access to their huge online user base and technical supports. It has had its content on the platform of BesTV, one of the major digital content and solution providers in China. It has established a joint venture with Tencent and another joint venture with testing solution provider ATA to develop online and mobile services for working professionals.

Image credit: Shutterstock

BAT Education New Oriental TAL Education