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Global EdTech Market Presents $41 Billion Opportunity for Apple

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Apple’s share of US education technology market has fallen

During an education event in Chicago in March this year, Apple (AAPL) unveiled a new low-cost iPad device along with new software aimed at students and teachers. The iPad, priced at $299, comes with Apple pencil support. The launch of the classroom-oriented tablet and software left no doubt that Apple is stepping up efforts to boost sales to schools amid ongoing global digitalization of education.

Apple was once a big technology supplier to the education market, especially in the US, where it commanded more than a 52% share of mobile device shipments to US K-12 schools in 2012. But its fortunes have dwindled in recent years. Futuresource Consulting estimates that its share of mobile device shipments to US schools dropped to less than 20% in 2017 compared to nearly 60% for Alphabet’s (GOOGL) Google and about 22% for Microsoft (MSFT).

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Google expands its school Wi-Fi initiative

It appears that competitive pricing of its Chromebook laptops and initiatives such as its Rolling Study Hall (or RSH) are helping Google attract educators, who are responding by spending more on Google’s education technology. Just about a week after Apple unveiled its new low-cost iPad for schools, Google announced that it was expanding its RSH initiative to more than a dozen additional school districts. The RSH initiative, which launched in North Carolina in 2016, involves Google fitting school buses with Wi-Fi and supplying students with Chromebooks so that they can continue their study during bus rides to and from school.

Alphabet outpaced Apple in revenue growth

Despite stiff competition, the education technology (or EdTech) market presents a massive revenue opportunity for Apple. Consulting firm Frost & Sullivan predicts that spending on education technology will grow to $40.9 billion by 2022 from $17.7 billion in 2017.

Apple’s revenues increased 13% in 4Q17, while Alphabet’s revenues rose 24%, Facebook’s (FB) revenues rose 47%, and Amazon’s (AMZN) revenues rose 38%.

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