Development Cost Survey

Estimate Cost of Developing Web-based Course

Background:

As I work on the project on the distance education course development tool, I started to wonder how much actually developing an online course should cost. I could easily assume that the estimate cost of developing a course greatly varies depending on the situation. However, professionals should have some guideline to determine an estimate cost. I was also interested in finding out what affects the cost. There should be some hidden factors that cost a lot in a development but people usually do not notice them beforehand.

Things needed to be considered:

Before going through a list of hardware, software, third party expertise, etc. when developing an online course, people need to identify exactly what they are wanting to teach, who will be receiving the training and what are the needs, and who is likely to teach it. Then follow that up with what in-house software, hardware, and development expertise is already available. One cannot begin to cost out a project without answering all these questions first.

In the teaching area you first need to ask:

What are the outcomes you wish to achieve?
Who is your audience?
What is their background?
What type of technical expertise do they have?
What type of technical expertise do your in-house people have?
How do you define interactive?
How will you assess your learning outcomes?
What type of reporting mechanism do you need to have?

Hardware/software costs:

What type of hardware do you already have?
Are you talking about adding to an existing network and server or starting from scratch?

e.g.

What capacity does it need to have?
How many simultaneous users will be accessing it?
Servers can run as little as $2,000 up to tens of thousands of dollars.
What type of software do you already have?
Image manipulation?
Authoring?
Database?
Is it run on a server now or stand-alone?
How does it interact with what you want to create?

A good suggestion for anyone entering into a technological solution for education is to form a team of people to tackle all these questions. Find people within the organization with the expertise needed (e.g., an instructional designer, a software person, a hardware/network person, a content expert) and put them on the team. For those skill sets not existent in the institution, that is where people need third party expertise.

Result:

This is a survey result on development cost. I realized that there are so many factors affecting the development cost, and it is extremely difficult to analyze this survey result. However, it was interesting to know different perspectives on the development cost and what people consider part of the course development cost.

Data:

The rule of thumb for developing fully interaction instruction is $200 per screen (by Asymetrix). This serves as a simple starting point. If one knows how many screens of content he wants to develop, the $200 per screen figure will give him a good first estimate of the total development cost. Asymetrix's point of using the $200 per screen figure was to make it clear that developing courses for delivery online can be expensive. Also, it certainly isn't something that should be attempted without a firm commitment to the process. It involves more then just filling a page with HTML code.
Online cram course for individuals preparing to take state examinations in the area of Life, Health and Variable Annuities could be valued at $800,000 each. Each cram course contains over 4,000 interactive screens.
The cost is averaging around $15,000 per course for initial development. It includes payment of designers, developers, coders, administrators.
A GED series of courses, which each consist of about 120 screens of information, tests, examples and assignments can be valued at $24,000 each.
A 9-week course, with pretest, posttest, web site, quizzes, 2 hours per week of live irc chat in a private dedicated channel on a server, plus a 244 page text in .pdf downloadable in ftp, a listserve for communication can cost only $410 to develop. Test and quizzes were created software is created by University of hawaii, and is free to teachers. There is no need whatsoever when everything you want is already there for free. This course costs $95 for a student to take, and nearly 800 students have taken it since 1995. It is students who decide if this course quality is there, nobody else.

Opinions:

The cost of course development cannot be prorated to a "per screen" number. The educational design process may be the same cost whether one presents 20 screens or 100 screens. However, certainly the technical costs for coding, placing on server, etc. could be prorated.
The post secondary market is being differentiated and deconstructed based on perceived price/value where price is not all in monetary units and value is not just in the content delivered in the classroom.
The key to the cost will be in the market position carved out by the academic institutions.
Somewhere the institution has to determine its market, what that market wants and at what price point and then determine if it can deliver the quality needed at a competitive price.
Not surprisingly the most frequently ignored costs are the hidden ones: not in the budget lines of the unit doing the purchasing. These includes costs that wind up in someone else's budget, sunk costs (space, tenured faculty), people's time (especially student's time).
The problem in valuing the cost of online courses is defining clearly what is and is not included. For example, do we include pro-rating the annual salary of the teacher or professor for the time dedicated to producing the course? If so, a professor earning $50,000 per year, taking one semester off to design online courses, has cost $25,000, without including software, hardware, technical help, etc. For a person who owns his own computer and modem, already paying his server, and transforming existing course notes, the out-of-pocket cost is $0.