Platform Capitalism and Edtech

For-profit edtech needs to be banned, and the government must play an active regulatory role.

After a Congress member of Parliament from Tamil Nadu highlighted the unethical practices of the Indian edtech companies in Parliament, the Ministry of Education (MoE) issued an advisory. The advisory asked parents to “verify that content being provided is in line with the syllabus” and “do a background check on the edtech company”—impossible requirements for the vulnerable sections like daily wage workers, who are increasingly targeted by edtech companies. The union education minister subsequently announced the formulation of a policy to regulate edtech platforms. Almost immediately, a group of edtech vendors informed the MoE that an “India Edtech Consortium” being formed would evolve a “code of conduct” for members, basically seeking to thwart regulation. On 19 January, the University Grants Commission (UGC) and the All India Council for Technical Education (AICTE) issued a ban on higher education institutions (HEIs) outsourcing their programmes to edtech companies.

The brief history of venture capital-funded big tech is a good indicator of how unregulated edtech will play out. Platform capitalism combines financialised capitalism and surveillance capitalism. The platform business model thrives on the “high-risk, high-return” venture capital. Leveraging huge investments, it mops up the entire market through predatory pricing and stratification of the offerings. The platforms are enabled by the network effect (as more people connect to the platform, it becomes more valuable for others to connect; a converse to the deceleration of growth rate for traditional businesses) and closed standards (proprietary standards that shut out competition). Large funding also enables the business to buy-out potential competitors and amplify the network effect.

Surveillance capitalism refers to the ceaseless and untrammelled extraction of data as the basis of market power. The platforms sell, rent, and harvest user data for advertising or cross-selling to get all or a large part of their revenues.

As the market ‘‘matures’’ into an oligopoly, the platforms are able to dictate terms to all economic actors in the ecosystem they control, extracting perennial and huge rents. Backed by venture capital funding, Uber and Ola offered attractive incentives to drivers and discounts to passengers to create their market, absorbing huge initial operating losses. Today, these platforms are able to increase passenger charges and charge drivers more, also harvesting their data to make inroads into other sectors.

Being heavily venture capital-funded, BYJU’S is able to offer its services at low or no charges (“Vidyartha,” its collaboration with Google, is offered gratis). The company’s “free limited-day offers” allows it to collect subscribers’ data—the source of valuable insights that sales force then use to “persuade” parents. The edtech company collects, buys, aggregates, and harvests data to get a 360° view not only of the child’s academic context but also of the psycho–social–economic behaviour of households. Using this information asymmetry, it is able to manipulate parents to succumb to its innumerable educational offerings across levels and areas. It is not difficult to imagine the company soon foraying into consumer goods for children and their families. While educational institutions are not allowed to hard sell their services, edtech’s mass media and social media marketing and one-on-one communication are not currently available for scrutiny. BYJU’S has bought 10 companies in its 10-year existence.

In addition to the political and economic dangers relevant to all platforms, edtech platforms present a far graver threat. Education is not another market good where non-consumption, stratified consumption or fraudulent service is tenable. Education is a public good and needs to be universal, equitable, of acceptable quality, and not stratified based on one’s ability to pay. It has been enacted as a fundamental right of children aged between 6 and 14 years, with increasing consensus to extend this to 3–18 years. The education policy declares the aim of education to be that of transforming the society towards the constitutional ideals of justice, liberty, equality, and fraternity.

The edtech market is an antithesis of these ideals. Exploiting parents and children desperate for the silver bullet to “make it big,” the model will likely extend the Kota suicide phenomenon to the rest of the country. Teachers will be relegated to providing the inputs, with the platforms pocketing most of what the parents pay. In the bargain, education will get completely hollowed out into a substandard, even hazardous consumer product.

Google, Amazon, and other tech behemoths are under investigation in India and other jurisdictions for anti-competitive and fraudulent market practices. The European Union and other countries have levied repeated fines on these companies, and it is eminently clear that the “self-regulation” model has failed.

Banning HEI outsourcing programmes is only a starting point. For-profit edtech must be banned, given that the law—as per the Supreme Court—requires education institutions to be not for profit. A data governance regime is necessary for the collection, custody, ownership, sharing, and analysis of data on children and their families, banning black-box algorithms and mandating algorithmic audits to reduce possible harms from edtech. Platform businesses must have no say in the curriculum/pedagogy/assessment (core educational services) or in digital intelligence services provision. Cognisant of addiction among children/adolescents, which lead to socio-psychological and physical health problems, restrictions on edtech and edutainment/gaming entities are necessary to prevent the overexposure of children—much like tobacco regulation. These recommendations may seem radical, but many are already in place in China.

The state cannot be a bystander merely cautioning citizens against edtech malpractices. What is needed is a vision and a road map for technology in education that actively promotes its public value and unequivocally restrains its commercialisation.

This article was published in epw on 22 January 2022. Read it here.


A podcast on issues  related platform capitalism and education is available here


Focus Areas
What We Do