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Posted at 12:06 PM ET, 11/23/2010

Murdoch buys education technology company

By Valerie Strauss

[Disclosure: Kaplan Inc. is a for-profit education subsidiary of The Washington Post Co., which publishes The Washington Post, my employer.]

This didn't take long: Joel Klein announces Nov. 9 that at year’s end he will resign as York City’s Schools chancellor to become executive vice president at Rupert Murdoch’s News Corp. Yesterday, the company announced that it was buying a technology company with big financial ties to the New York City school system.

Murdoch’s company, according to a story at businesswire.com, is acquiring 90 percent of Wireless Generation, a privately held Brooklyn-based education technology company, for approximately $360 million in cash. It will become a subsidiary of News Corp.

One of the things Wireless Generation does is build large-scale data systems that centralize student data and is a “key partner to New York City’s Department of Education on its Achievement Reporting and Innovation System (ARIS) as well as on the City’s School of One initiative,” the story said.

(The ARIS contracts -- worth tens of millions of dollars -- and the contracts the New York City Education Department has issued for its School of One program were apparently negotiated rather than competitively bid.)

After Klein’s announcement, News Corp. officials told the New York Times that Klein would advise Murdoch on a number of initiatives, including “developing business strategies for the emerging educational marketplace.”

Murdoch, chairman and chief operating officer of News Corp., has taken a keen interest in education reform lately, investing in Teach for America and some charter schools.

I wonder why.

“When it comes to K through 12 education,” Murdoch said in a statement about the Wireless Generation purchase, “we see a $500 billion sector in the U.S. alone that is waiting desperately to be transformed by big breakthroughs that extend the reach of great teaching.”

No doubt “great teaching” is what motivates Murdoch (whose News Corp. had, as of Sept. 30, 2010, total assets of approximately $56 billion and total annual revenues of approximately $33 billion).

The current wave of education reform based on “data” and “accountability” hasn’t done much to improve public schools, but it sure is helping improve the balance sheets of a lot of for-profit companies.

It is true that some nonprofits don’t operate a whole lot differently than some for-profits. And certainly for-profit businesses can and do bring valuable products and services to public schools. They make money by meeting demand, so, presumably, they fill some perceived need in the system.

But ultimately, the loyalty of for-profit companies is to the bottom line and investors, not necessarily to the general good of public schools and kids. And they get their return on investment with public money.

When business people decide to get into the education world in a big way, their support for specific reform measures has to be seen through the prism of money-making opportunities, not what research says works best for kids.

Allowing business people to drive education policy is a very dangerous business. Why the Obama administration thinks this is a good idea is way beyond me.

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By Valerie Strauss  | November 23, 2010; 12:06 PM ET
Tags:  education technology, joel klein, new york city public schools, news corp., news corporation, nyc schools, public schools, rupert murdoch, school policy, school reform, schools, wireless generation  
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Comments

Can you say "conflict of interest?" Joel Klein, and the rest of the "reform" pirates can't. Remeber Rhee firing teachers so she could direct the jobs to her old recruitment firm. Now her lapdog, Henderson is doing the same thing.

Posted by: mcstowy | November 23, 2010 12:43 PM | Report abuse

(The ARIS contracts -- worth tens of millions of dollars -- and the contracts the New York City Education Department has issued for its School of One program were apparently negotiated rather than competitively bid.)

Why the ()? This is public information. Either it was bid or it wasn't.

We know the Wireless Generation deal with Montgomery County, MD wasn't bid and taxpayers didn't recoup the investment that was made with tax dollars.

Posted by: jzsartucci | November 23, 2010 1:45 PM | Report abuse

Why not buy Kaplan? Fools rush to buy this drivel and pass it off as teaching. Are schools any better? Are school budgets worse off?

What is the cost of this material vs pencil and paper? How many times will the software/hardware require upgrading vs pencil and paper? How many computers can a child take home vs pencil and paper?

Teachers and administrators keep buying this expensive material then bash the public for more funds and whining the whole time about pay.

Want to improve learning?

Try pencil and paper. Try repetition. Try mastery. Send the computers out on the next shuttle.

Posted by: jbeeler | November 23, 2010 1:53 PM | Report abuse

'Teachers and administrators keep buying this expensive material then bash the public for more funds and whining the whole time about pay.'

I've been teaching 21 years, and the last time I was even notified of upcoming purchases was the mid-90s. And given the power to purchase? That's funny.

But it's pretty clear this event is not about site educators misspending the small amounts that trickle down. It's about that half a trillion dollar bonanza waiting for corporate raiders to tap. Hey, there's a good documentary title: Waiting for Rupert.

Posted by: kidswarrior | November 23, 2010 2:54 PM | Report abuse

And you can count on Newsweek and Time to praise Murdoch.

Posted by: jlp19 | November 23, 2010 3:03 PM | Report abuse

jbeeler,

I am certified to teach technology education - but I have never been asked or consulted with any education technology purchases. Neither have any teachers I have known been consulted.

Posted by: jlp19 | November 23, 2010 3:04 PM | Report abuse

I'm sure Fox News, also owned by Murdoch, will be featuring lots of propaganda about how school reform is needed. I'm also sure that Joel Klein, Michelle Rhee and Arne Duncan will be commenting on the situation regularly.

Posted by: teacher39years | November 23, 2010 3:53 PM | Report abuse

jbeeler
Where did you get the idea that teachers have any voice in how school districts spend tax money? The usual routine is for the district to ask teachers to serve on committees to evaluate new materials and then make recommendations about which books and materials should be adopted. Then a group of well-meaning teachers gets together and spends upmteen hours, often unpaid, in an earnest effort to make a good recommendation.

Then, one or more administrators up on the food chain awards the contract to whichever company gave them the most luxurious trip to Epcot, or maybe just a big fat kickback. The teacher committee is a farce in which experienced teachers know not to participate.

Posted by: aed3 | November 23, 2010 4:59 PM | Report abuse

Thank you for sharing this.

Posted by: dcparent | November 23, 2010 6:06 PM | Report abuse

Michael Bloomberg ,Klein's old boss, is the tenth richest person in the United States. Bill Gates is the third richest person in the world. It's amazing that all these rich people view Charter Schools and untrained teachers as the solution to the nation's educational "crisis." Small world, isn't it?

Posted by: teacher39years | November 23, 2010 6:32 PM | Report abuse

Free from scrutiny and accountability, News Corp acquired Wireless Generation (WG) aided by the “reformers” to gain WG’s multi-million dollar local testing, state testing and database contracts.

Corporate control and acquisitions are not about quality education, students, or ethical research. It’s about greed, multi-million dollar contracts, royalties, profits, and stock increases for the shareholders. The “researchers” and insiders involved do not disclose their conflicts.

Parents and taxpayers must know the history and the facts behind News Corp’s acquisition and ask for local public education and state education contracts involving Wireless Generation through the Freedom of Information Act.

In 2002, Wireless Generation was erected with federal grant funds of at least $6.7 million funneled through the UT-System and Wireless Generation. In 2004, the Texas Education Agency, the UT-System, University of Houston, and several “researchers” began receiving undisclosed “royalties” from Wireless Generation funneled through the University of Texas Health Science Center at Houston.

On a related NCLB policy-testing-technology-royalty scam, Wireless Generation insiders and lobbyists were involved with the Reading First federal grant swindle.

As a result of federal and state grants, WG reaps millions in profits for “progress monitoring” on a PDA of the DIBELS K-3 test and the Texas Primary Reading Inventory test without disclosing conflicts of interest with the UT-System and the University of Oregon.

Duncan/Gates advocate for cutbacks on teachers’ salaries based on education levels. They propose hiring TFA temporary employees on the cheap. Why? Firing experienced teachers and reducing teachers’ salaries releases millions in funds for News Corp/Wireless Generation’s corporate testing machine to outsource teachers and replace teachers with prescriptions and scripts through technology and on-line charters without adding value or enriching education for students.

Reducing salaries of America’s middle class teachers through a complex bait and switch scheme will funnel funds to the corporations like News Corp/Wireless Generation.

“University of Texas Health Science Center at Houston-Center for Academic Reading Skills (CARS), University of Houston's Texas Institute for Measurement, Evaluation, and Statistics (TIMES) and Wireless Generation, Inc. announce the receipt of a prestigious Inter-agency Education Research Initiative (IERI) grant for $6.7 million”

http://www.allbusiness.com/government/government-bodies-offices/5958534-1.html

Posted by: nfsbrrpkk | November 23, 2010 6:37 PM | Report abuse

nfsbrrpkk is absolutely right about replacing real teachers with prescriptions and scripts. It is already happening in DCPS with the scripted reading curricula/intervention - only given to the "neediest" schools, those who do not make precious AYP on tests. Wiser, more experienced teachers and school administrators stand up to junk like this. But TFA corps members and TFA or NLNS principals just don't have the experience or wide view enough to push back.

The reading curriculum I'm talking about is scripted and whole-group instruction. There is literally a timer feature where if kids don't "get it" after listening to the spiel with cue cards in a certain number of minutes, the teacher is supposed to move on to the next topic. Innovative, huh?

At least we get to keep our kids out of school two days this week so they can get that garbage out of their systems.

Posted by: dcparent | November 23, 2010 8:12 PM | Report abuse

Tell Obama what you think at
http://my.barackobama.com/page/content/vote2010survey/?source=20101123_MS_actives

Posted by: BurtF | November 24, 2010 3:11 AM | Report abuse

nfsbrrpkk I appreciate your synthesis of information on how our public school tax dollars are being re-routed as we move from public service to corporate welfare. Two more multimillion dollar drains on public school tax dollars are the testing industry including Pearson and ETS who are huge here in Florida and real estate tax law loopholes for development of Charter school facilities. The Fla Senate president is also a lobbyist for ETS and is allowed by state law to continue lobbying while he serves in the Senate! Pearson is closely tied to Jeb Bush who is still pulling the strings from behind the curtains of his Foundation that is now circulating another SB6 law that would add dozens more mandated tests which would be used to evaluate teachers. Senate president Thrasher was "aided" in his initial election by Jeb and led the way last year on that legislation and will do so again using the Fla RTTT money as cover. This adds up to millions more than the State can actually afford for test development that will of course go to companies like ETS and Pearson and come out of money for actually teaching our children! where they think the money for any teacher bonuses based on all these tests will come from is an unanswered question. But the Fla legislature has never been big on details like balancing budgets or constitutional legality of legislation. The last SB6 law removed the constitutionally guaranteed right of a school board to negotiate salaries. So more money will probably be frittered away in lawsuits once the new law passes.
Charter school developers on Wall Street and in the real estate business can make big bucks on development of real estate to use for Charter schools. They get a big fat tax credit for their "public service" and the original Wall street investors then sell to real estate developers and both collect 10% profits on their investments plus the tax credit. This profit comes at the expense of services and materials for the students of these charters and out of the of salaries and benefits for their teachers. One Charter school in Nevada was found to be paying 40% of its income to rent to pay for the debt run up by this type of scheme. (see Charter School Scandals blog for more details on this)

Question: Has anyone out there seen a chart of graph or data set that lists the media corporations and their affiliated education businesses? It would be interesting to see all that information in one place. My Google searches did not give me this info. Anyone?

Posted by: kmlisle | November 24, 2010 10:14 AM | Report abuse

While Time and Newsweek continue to lie about what is going on in education, parts of the Washington Post (such as Valerie Strauss and some others) keep telling the truth.

Posted by: jlp19 | November 24, 2010 3:21 PM | Report abuse

http://www.cps.edu/About_CPS/The_Board_of_Education/Documents/BoardActions/2008_07/08-0723-PR16.pdf

The reformers exploit students and buy corporate-technology-assessment rubbish to benefit the insiders using taxpayers’ funds. The no-bid renewal contract with Wireless Generation signed by Arne Duncan in July 2008 for $2,800,000.00 is interesting. Did Murdoch have inside information?

Posted by: nfsbrrpkk | November 25, 2010 11:30 AM | Report abuse

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