Tag Archives: babbel.com

language learning

Language Learning needs to be Flipped

EducationInvestor April 2014This column was first published in EducationInvestor Volume 6, Issue 3 April 2014.

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When it comes to language, Europe is in a unique position. In a small geographical area, connected by a common market and to some extent common culture, we have access to nearly all the world’s most important languages: English, of course, but German, Spanish, Portuguese and French all play major roles in global trade, too. And the European Commission is keen to get people learning: a year ago, it announced the lofty goal of making every European speak at least three languages, calling this multilingualism strategy “mother tongue plus two”.

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Duolingo

Duolingo hits 10 million Users – Wants to give Language Learning a Bigger Purpose

Duolingo

Yesterday Duolingo released a new promo video on its YouTube channel. Marketing and feel-good / world-changing agenda aside, the spot has a pretty telling message: Language, free at last. (emphasis mine).

I also just got an email stating that

“Since its launch 15 months ago, Duolingo has reached 10 million students and become the most popular way to learn languages online. No ad campaign, no gimmicks; just your support and a mission of free language education for the world.”

Looking a few years back the premise of language learning startups like Livemocha, busuu and babbel.com was to make language learning more affordable compared to their chosen nemesis Rosetta Stone. Since then Livemocha’s newsletter has turned into a sales channel for Rosetta Stone after the acquisition, promoting RS products at 60% off.

As a funny side note: if you follow the link to Livemocha’s YouTube channel on the bottom of the email, you will still find the legendary Livemocha spot with the (infamous) yellow boxes.

But back to Duolingo. If you talk to folks in the language learning industry you notice that most (all) of them are not happy about the new competitor. How can you compete with a free product that also seems to work quite well according to a study.

What Duolingo does is essentially disrupting the former disrupters or at least establishing itself as the third alternative method. busuu’s success is clearly its global community of language learners and babbel.com has chosen a more technology based approach similar to Rosetta Stone.

Now, of course we all know that there is no free lunch and, to use another catch phrase, if the product is free you are the product. Duolingo is selling this over a call to join a movement, giving your language learning a bigger purpose

“With Duolingo there is no tuition or subscription fee. It’s 100% free. Instead students like us give back by helping to translate websites, news and Wikipedia articles. It gives our personal language learning journeys a bigger purpose.”

I can see why many folks in the space see this storytelling as misleading. In fact Duolingo users are Mechanical Turks but instead of getting paid a couple of cents per task, they get “free” language lessons in return. Sounds good but they should also know how much their work is actually worth and whether language lessons, as good as they might be, are an adequate recompense.

The new spot is definitely a step-up from the first one that was more toned down yet also mentioned the business model behind Duolingo, adding the layer of being part of a global movement to better the world through language learning.

I also think people underestimate the power behind such global communities. Just recently Viki, the online community around translating and adding subtitles to popular TV shows, got acquired by Rakuten. One of the rumored bidders was Google.

Since I first heard about Duolingo and its concept I was pretty sure that the startup is one of the upcoming acquisitions by Google. Not only did Google acquire Luis von Ahn’s first startup reCAPTCHA but if Duolingo can prove that a global community can offer nearly instant translation of every web page, Google just has to write that check as it perfectly fits the overall strategy that we can see with Google Glass, Google Translate and other related services.

And if you think about it, von Ahn also took a site out of Google’s playbook in terms of the business model. Give the users a great service for free and make money based on their data and content.

Rosetta Stone

Rosetta Stone to evolve from Language to Learning Company

Rosetta Stone

Are the days of high priced language learning software over? With Rosetta Stone’s latest acquisition it surely looks as if one of the leading companies in that sector is looking for greener meadows.

The $22.5 million all cash acquisition of Lexia Learning reported by the Wall Street Journal is one indicator that language learning isn’t enough to survive in the long term; the quote

“We are evolving the company from a language company to a learning company,”

by Rosetta Stone’s CEO Steve Swad a second one.

Also, customers already are under the false impression that Rosetta Stone is offering far more learning products than just languages. According to the WSJ a survey showed that people already relate RS to math, reading and music products. Swad stated “To me, it’s just evidence of brand permission to extend.”

Of course the acquisition of Lexia Learning also strengthens Rosetta Stone’s position in the K-12 and global English learning market yet we have to see it as part of a far broader strategy to transform Rosetta Stone into a learning company. From the press release

“This acquisition is another step in the transformation of Rosetta Stone,” said Swad. “We`re moving beyond language; we`re leveraging technology; we`re growing our business in new and meaningful ways. And we`re positioning this company to change the face of learning as we know it.”

I think it is pretty obvious to Swad and the team at Rosetta Stone that the days of high priced boxed (or downloadable) language software are numbered. The acquisition of Livemocha earlier this year and therefore the transition to a cloud based language learning portal was a first step here to compete with similar players like babbel.com and busuu.

All three offer language learning products at a fraction of the price customers need to pay for a Rosetta Stone product. Even the current half price offering Rosetta Stone is promoting on Facebook at $395 looks outlandishly expensive compared with the package prices Livemocha, babbel.com or busuu offer.

Rosetta Stone Promo

And we must not forget Duolingo that is slowly but surely becoming a real threat to the startups that aimed to disrupt Rosetta Stone. Duolingo already offers different languages and mobile applications at no cost to the learner. Duolingo also has studies that show the efficiency of its products and the startup is growing fast. Also, the reviews of people learning with the product I have read so far were fairly positive.

Therefore, it seems to be a good idea to find more lucrative niches as soon as possible. Other verticals are yet pretty much untouched from decreasing prices and Rosetta Stone’s brand and technology might enable the company to build up a new foothold there.


Picture License AttributionNoncommercial Some rights reserved by olivcris

Rosetta Stone Kiosks

Rosetta Stone Kiosks to be closed in Transition to Cloud based Service

Rosetta Stone Kiosks

Rosetta Stone’s CEO Steve Swad is accelerating the company’s transition into a cloud-based learning experience. What used to be one of the marquee items of Rosetta Stone will soon only be a memory: the airport and mall kiosk.

Not even two years ago, under Rosetta Stone’s former CEO Tom Adams, the company invested in new experience kiosks where people could test the software and retail stores targeted at an audience in Hollywood and Capitol Hill. But according to the press release

Rosetta Stone’s kiosks had come to represent a shrinking portion of the company’s overall sales mix, especially as their revenue contribution was eclipsed in 2012 by growth from the web channel and the rising popularity of digital downloads. The company has closed over 100 kiosks since 2011, and by exiting its remaining locations, it sheds a low-margin channel and positions itself to invest in more profitable channels going forward.

With the closure Rosetta Stone is going to let go 245 full and part time sales representatives who worked in the kiosks, following the goal of turning the company into a more nimble and innovative player to compete its smaller however quickly growing competitors babbel.com and busuu.

London-based busuu just shared the news that it has surpassed 30 million users, now adding 40.000 new users per day. It also launched a new iPad application for young Spanish learners. According to TechCrunch busuu shows strong growth in emerging markets like Brazil, Russia and Turkey, markets that are also of high interest for babbel.com which just raised a $10 million Series B round in order to expand its services globally.

With Rosetta Stone’s focus shifting away from physical locations and products and last week’s acquisition of Livemocha this is going to be a very interesting year in the language learning space. Now that Rosetta Stone really goes all in it is certainly getting harder for busuu and babbel.com to keep on grabbing market share.

Of course, Rosetta Stone needs to come up with a compelling low cost alternative of its products, probably using the Livemocha brand, I could imagine them to start by offering a version of their Mobile Companion application branded as Livemocha, likely with less features to make it different from the premium Rosetta Stone products.

Talking about premium products I am pretty sure that with the transition in to the cloud Rosetta Stone’s physical CD-Rom and DVD courses are the next thing that will disappear. Reminiscent of Livemocha’s rivalry with Rosetta Stone, let’s watch Livemocha mocking the emblematic yellow boxes in a 2011 commercial.

Picture by San Diego Shooter

Rosetta Stone Livemocha acquisition

Rosetta Stone acquires Livemocha for $8.5 million in Cash

The group of Rosetta Stone contenders shrunk to two today. According to a press release Rosetta Stone has acquired Seattle based language learning community Livemocha for $8.5 million in cash.

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