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LMS Pricing Trends (Installed Implementations)by: Richard Nantel
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Notes for this articleGood chart also, blog post.
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AbstractI’ve been digging through our research databases and looking at the historical pricing of learning management systems. The chart below shows the average three-year cumulative pricing for small (500 users), medium (10,000 users), large (25,000 users), and very large (100,000 users) implementations installed on clients’ servers from 2005-2007. (I’ll provide the data for hosted implementations in my next post.) (Prices in U.S. dollars) This data is based on the prices for 52 LMS profiled in our 2005-2006 research, and 63 systems currently contained in our 2007 research. All prices have dropped over the last three years. The more dramatic drops have taken place in smaller implementations. Average pricing for 500 user implementations has dropped 20% since 2005. Average pricing for 10,000-25,000 user implementations has dropped about 17% since 2005. After a dip in 2006, average pricing for 100,000 user implementations has only dropped about 2% since 2005. The prices and percentages listed above aren’t adjusted for inflation. Taking inflation into consideration (about 2.5% per year) , the drops have been more substantial, adding another 5% to the decrease in prices since 2005: 500 users: 25% 10,000 users: 22% 25,000 users: 22% 100,000 users: 7% Add rising staff salaries to the mix, you would think that LMS vendors would be feeling a painful squeeze on profits. Strangely, that isn’t reflected in the number of learning management systems currently available. Over the last six years, I’ve heard a lot of talk about impending consolidation and commodification in the LMS marketplace. The drop in prices in the last two years hasn’t decreased the number of systems available. In fact, new learning management systems continue to pop up all the time. There are more learning management systems available today (both commercial and open source) than ever before. For organizations looking to acquire their first learning management system, or organizations considering a change in their existing LMS, this is all good news. Prices have dropped and the selection has increased since 2005.
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