Exam web plans additional licensing of their assessment technology

McGraw-Hill’s gradesummit reports on student comprehension: Exam web plans additional licensing of their assessment technology

McGraw-Hill Higher Education (MHHE, New York, NY www.mhhe.com), using technology from ExamWeb (Newport Beach, CA, www.examweb.com), has created a new online product called GradeSummit. The assessment tool lets students test themselves on comprehension of topics aligned to textbooks, identifying strengths and weaknesses by topic. The collective data gathered from the assessments creates further value in the product. Students can compare their performance to other groups of students (perhaps their class or all users of that GradeSummit product), professors can gauge their class’ progress, and MHHE can even judge the effectiveness of their textbooks.

Currently available courses covered by a GradeSummit product are Principles of Economics, Microeconomics, Macroeconomics, Anatomy & Physiology, General Chemistry, US History Survey and Introduction to Psychology. MHHE expects to ramp the number of GradeSummit products up to 100 of the top college courses.

Mike Junior, VP eProduct and business development, expects sales to be driven by professors requiring or encouraging students to purchase both the textbook and a GradeSummit subscription. In fact, early usage shows that professors use the resource as a regular component of homework assignments. Generic versions of GradeSummit can stand apart from a specific textbook as an independent learning tool for a college course. A stand-alone subscription sells for $19.95 per semester. Junior expects the service will be discounted by more than 60% when purchased with a new textbook.

While many electronic products have been designed to preserve textbook sales, GradeSummit is designed to develop a new revenue source. The product is currently in a free trial phase with 10,000 students. Though not yet marketed, it is now available for sale, and Junior says there are students who have discovered and purchased it for themselves.

Junior says the product has been received with more enthusiasm than anticipated. Pointing out that professors are inundated with electronic products and struggling with their implementation, Junior says it is essential to keep the product simple and the marketing message straightforward. For that reason, MHHE chose to limit the product to assessment; rather than building a prescriptive product, MHHE designed GradeSummit to rely on the instructor for directing a student to resources and strategies to correct weaknesses.

ExamWeb Licensing Assessment Technology

The technology powering GradeSummit is licensed from ExamWeb with a revenue sharing model. ExamWeb’s origins go back five years ago to when Matt Harris, president and CEO, wanted a more efficient way to prepare for his chartered financial analyst (CFA) exam. After bringing a CFA test prep program online, the company was profitable in three weeks. Harris then realized the basic architecture could be filled with other content, and so he partnered to supply services for the LSAT. That business model grew, and until a year ago, ExamWeb was a test prep company selling directly to the consumer and competing with the likes of Kaplan, Inc. or The Princeton Review.

That market approach, says Harris, had huge customer acquisition costs, and last year Harris refocused on licensing the technology. The GradeSummit deal is the largest licensing agreement to date. ExamWeb is also working with McGraw-Hill/Osborne Media for IT certification testing. The assessment technology is also integrated with McGraw Hill’s course management software, PageOut. That tool is marketed to individual professors wanting an online course or online course component, and more than 60,000 professors are registered to use it.

Corporate training, with either a licensing model or the creation of custom programs, is expected to be a significant market for ExamWeb. The company has licensed technology to Prudential for training real estate agents and to the Foundation of Real Estate Appraisers.

In an unusual model for the company, it provides both content and technology for Kaplan’s CPA test prep product.

Harris expects his product’s capabilities and prices to be attractive to a wide range of licensing partners, including those wishing to add assessment capabilities to K-12 products and course management software.

In the corporate training arena, the technology’s automatic reporting systems allow performance data to be downloaded to learning management systems. In all applications, the adaptive testing technology can dynamically rerank questions based on collective usage. Exams can be in a test mode, practice mode or fixed. Multiple choice is the most common form of question, but ExamWeb also supports question types such as fill in the blank, true/false and matching. The system handles short essays by emailing them to human graders.

ExamWeb is a six-person company after shedding its marketing department with the refocusing of the business plan. It was started with funding from Harris and angels with a venture capital round in March of 2000. A more substantial venture round is in the works. ExamWeb continues to offer and support its original programs such as test prep for the CPA, CFA, GMAT, GRE, SAT and LSAT.

COPYRIGHT 2001 Nelson B. Heller & Associates

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