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The for-profit e-learning company grew 40 percent last year, generating $385 million in revenue by providing virtual courses to 70,000 students across the country.

Connections Academy, another such provider, generated about $120 million in revenue serving up online courses to some 20,000 students. And recently, the education technology company announced that it is now offering online Advanced Placement courses, marking the first time the company will do so as part of its courseware for school districts.

Experts say for-profit providers of online courses鈥攍ong seen as an option for home-schoolers and a potential rival to public schools鈥攁re breaking into the public education mainstream as more schools mix face-to-face classes and online courses to expand their curricular offerings. With demand for that 鈥渂lended鈥� approach expected to grow, other players in the online-coursetaking marketplace, such as Apex Learning, Aventa Learning, Compass Learning, and Kaplan Virtual Education, are also seeking business in public schools.

鈥淢ost of the growth is in hybrid environments,鈥� says Michael Horn, the executive director of education at the Mountain View, Calif.-based Innosight Institute and a co-author of Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns, referring to the combined use of online and face-to-face courses in schools. 鈥淭here are lots of definitions of what this means.鈥�

鈥楤ig Question Mark鈥�

But the growth of such companies has also attracted critics, who say schools should take a closer look at the benefits the providers tout.

E-EDUCATORS EVOLVING

This recent Education Week special report, the second in a three-part series, examines how the K-12 system is preparing, evaluating, and compensating cyber educators. It also takes a close look at the challenges teachers face when they make the transition from classroom teaching to online-only instruction.

鈥淚 haven鈥檛 seen anything in this industry that is special in terms of its pedagogy or its delivery,鈥� says Alex Molnar, the publishing director of the , based at the University of Colorado in Boulder.

Molnar says that hooking up school districts with online courses to fill gaps in curriculum is certainly helpful, but that using for-profit companies to do so is unnecessary.

鈥淲hat benefit does a for-profit entity provide over and above what could be readily provided at a university extension?鈥� he says. 鈥淲hy wouldn鈥檛 you use a nonprofit, publicly supported university that鈥檚 transparent and politically accountable?鈥�

Henry M. Levin, the director of the , based at Teachers College, Columbia University, adds that online coursetaking may be a good option for many schools and students, but that more independent research is needed, especially at the K-12 level, to evaluate its effectiveness.

鈥淚t鈥檚 a big question mark out there right now,鈥� Levin says. 鈥淢ore claims are being made than are justified. Both the effectiveness and the cost side of [online coursetaking] have really not been studied carefully.鈥�

Despite such concerns, many small companies are also entering the online-course market.

鈥淎 lot of e-learning CEOs are educators,鈥� says Susan D. Patrick, the president and chief executive officer of the Vienna, Va.-based . 鈥淭hey鈥檙e looking for a better way.鈥�

Part of that 鈥渂etter way,鈥� she adds, is bringing research and development and economies of scale along, too.

That鈥檚 the aim of K12 Inc., based in Herndon, Va. Ron Packard, who has a master鈥檚 degree in business administration and once worked at Goldman Sachs, founded the publicly traded company 10 years ago.

Packard and others believe that for-profit schools offer a decided advantage: access to capital. That translates, they say, into the ability to scale up at a much faster鈥攁nd more cost-effective鈥攔ate than public schools can.

The biggest challenge, though, is developing course content from scratch, which cost K12 Inc. $30 million last year. Besides the cost of developing content, money is also needed for K12鈥檚 technology needs.

Some critics have said that such content-development costs have prevented for-profit online-course providers from adding the kinds of multimedia features that are the hallmarks of high-quality online courses. They say that in many cases, traditional content is merely placed online.