DOJ Investigates Blackboard Acquisition of ANGEL

Many thanks to Timothy W. Peterson, Ph.D., Dean of Continuing Education, Washburn University for conveying the news that the Department of Justice (DOJ) is investigating Blackboard's acquisition of ANGEL learning. He wrote:

In case you've haven't already seen the article below.The United States Department of Justice is apparently taking an interest in Blackboard's recent acquisition of Angel Learning. DOJ has been asking questions about the controversial buyout, according to Blackboard's chief rival in the commercial LMS space, Desire2Learn.

The Campus Technology article about the investigation is at http://tinyurl.com/pgfdgf.

From the Desire2Learn's own web site we learn some additional details; see http://tinyurl.com/D2LonBb.

For additional background on the migration of Blackboard users to ANGEL check out http://tinyurl.com/owxe6k.

To review my FAX complaint calling for an investigation check out http://tinyurl.com/qxtq7c.

Join the "Force," file your own citizen's complaint!

DOJ Fax Complaint

Here's the language of the FAX sent to the Department of Justice Citizen's Complaint line regarding the Blackboard acquisition:

Please feel free to use any portion or all of this language to file your own complaint.

Blackboard Inc. (650 Massachusetts Avenue N.W., Washington, DC 20001-3796, phone: 202 463-4860, http://www.blackboard.com/) licenses two learning management systems (LMS): Blackboard Campus Edition (formerly WebCT and acquired when they purchased WebCT in 2006) and Blackboard Academic Suite (their original product). Numerous schools, Johnson County Community College among them, have chosen to cease licensing Blackboard and are in the process of migrating to a different LMS, primarily ANGEL offered by ANGEL Learning. This migration is specifically related to cost and the lack of customer support and responsiveness to the customer.

In early May 2009, Blackboard Inc. announced that they have acquired/purchased ANGEL Learning, thus eliminating one of the last non-Blackboard Inc. options available to institutions offering online instruction. Further, Blackboard has an on-going patent infringement case against another competitor in the LMS field, Desire2Learn. Blackboard appears to be trying to shut down competition either by purchase or by legal action. Their patent claim is disputed by most industry leaders and has been thrown out at least once by the court but the decision has been appealed and a second patent claim filed by Blackboard against Desire2Learn.

If you check my blog at http://angeliclearning.blogspot.com/ you’ll find several postings on this issue including the May 10, 2009 posting that lists institutions that have experienced poor customer service and an inferior product line since the merger of Blackboard and WebCT.
Our concern is that Blackboard through monopolistic practices is reducing the viable alternatives in the field and forcing the higher education customer base to use Blackboard product(s) as they eliminate other options. To see verification of this, please review the Instructional Technology Councils 2008 Distance Education Survey Results, Table 1, page 3 at http://www.itcnetwork.org/file.php?file=/1/ITCAnnualSurveyMarch2009Final.pdf).

We are requesting that the Department of Justice review this merger/acquisition to determine whether allowing the process to continue creates a monopoly by significantly reducing competition and whether the needs of the higher education community are served or jeopardized by the acquisition.

Footnote: Additional coverage of this "buyout" has appeared in:

• The Chronicle of Higher Education: http://chronicle.com/free/v55/i37/37a00102.htm, May 22, 2009


• eLiterate: http://mfeldstein.com/bad-news-for-blackboard-good-news-for-angel/

More on the ANGEL Buyout

Department of Justice Complaint Line

An article in the Chronicle of Higher Education dated May 11, 2009 (http://chronicle.com/wiredcampus/index.php?id=3764), concludes with this paragraph:

Matthew Small, Blackboard’s chief business officer, said Blackboard’s acquisition of Angel Learning was too small a transaction to trigger an automatic review by the department. When Blackboard purchased a larger rival, WebCT, in 2005, the deal was large enough to spark a routine review by Justice Department officials before the sale officially closed, he said. “I don’t think that there’s any anti-trust concern with this combination,” said Mr. Small.

Jim McWard, professor of English, contacted the Department of Justice to voice his concerns and was given a fax number for filing a formal citizen's complaint against the merger: 202-514-1629 (fax number for Citizen's Complaint at DOJ.)

This is clearly one avenue for expressing concern and I've also faxed a citizen's complaint to the DOJ. I hope faculty and staff from other colleges that have recently switched to ANGEL (see http://angeliclearning.blogspot.com/2009/05/flight-from-blackboard-to-angel-and.html) will join in this grassroots effort for a government review.

Institutional Action

At JCCC, the Educational Technology Center working in conjunction with our ANGEL Implementation Project Team and the Distance Learning Coordinating Council also plan the following actions:

1. We’ll carefully monitor ANGEL technical support to be sure it is responsive and avoids the pitfalls that occurred after the Blackboard/WebCT merger. ANGEL support has been timely and accurate to date. Blackboard at the conference indicated that the ANGEL support center will remain in Indianapolis. If they start requiring tech support personnel to move to DC, like they did with WebCT staffers who lived in Vancouver, BC, we’ll know they haven’t learned any lessons.
2. We’ll watch for further development of the ANGEL platform. ANGEL traditionally offers a yearly “dot” release or upgrade with fixes every other month. If we see a variation on that pattern, we’ll suspect that Blackboard is walking away from the ANGEL platform.
3. We’ll also monitor any changes in the pricing structure. Blackboard has a tradition of charging addition fees for features that are covered by ANGEL’s basic license.
4. If (when) Blackboard merges ANGEL into Blackboard’s NG (Next Generation) tool we’ll have to carefully evaluate migration tools available as well as the design and features of the new product. Blackboard has traditionally been a tools based product while ANGEL is more content (lessons) oriented. For the majority of our faculty who have made the transition, the latter approach seems to better meet their instructional needs. If the NG product is a dramatic shift from ANGEL and a major transition is imminent for our faculty anyway, then we’ll explore all LMS options before assuming we’ll move to NG.
5. Finally, we’ll keep our eyes and ears open over the coming couple of years to see what other options are available should Blackboard take ANGEL in an undesired direction. We’ll keep an eye on the marketplace including open source products.

Flight from Blackboard to ANGEL (and Back Again)

With the announcement this past week of Blackboard becoming a larger "black hole" swallowing up ANGEL Learning, a question came to mind. How many former customers of Blackboard Inc. abandoned one of that company's learning management systems (LMS) for ANGEL, only to find they have not escaped after all? So, I posted a survey on several lists that include ANGEL users. Here are the results to date (I'll keep updating as long as I hear from more schools):

• Brevard Community College, FL, "(4 campuses) went to ANGEL from Blackboard starting the Fall 2007 semester. The reasons given were: 1. Cost – Blackboard was too expensive compared to ANGEL. 2. Service – weeks and months would often pass before problem tickets were addressed. 3. Faculty approved ANGEL over Blackboard and competing systems."
• Bristol Community College, "I think an equally interesting question is how many WebCT users have made the switch. We've lived through this before and know how the song goes...," signed ANGEL contract this past Tuesday.
• Buffalo State College, NY, "moved from Blackboard to ANGEL in 2005 due to Blackboard’s outrageous prices and deplorable customer service."
• Butler County Community College, KS, "after Blackboard bought WebCT (the college) was not treated well and support went downhill quickly."
• Central Florida Community College, FL, "left WebCT 4.1 because of the Blackboard purchase. Too many problems with Blackboard support."
• Concordia University Wisconsin, WI, "Blackboard was unwilling to answer our support requests even when our entire e-learning program was on hold for over a week (right before finals), 2) in our review of five LMSs that met our basic tech requirements (integration with Banner, for example, ANGEL was number one 4) ANGEL was far more affordable, 5) ANGEL customer support ratings were great, 5) a focus group of faculty found ANGEL to be the most intuitive of the LMSs that we reviewed, 6) we were not comfortable doing business with a company that we didn’t trust and clearly indicated that they had no interest in keeping our business, and 7) the 2.0 capabilities and open architecture allows us to customize the product," in transition now, turn off old server in October 2009.
• Creighton University, "We moved from Blackboard to ANGEL in summer 2007 for a few reasons, #1-price, #2-functionality, #3-support!"
• Gettysburg College, moved from Blackboard to ANGEL Spring semester, 2006.
• Johnson County Community College, "poor customer service, buggy product, slow response time on promised fixes and upgrades, lost many features we had become accustomed to in WebCT after moved to Blackboard CE, even though it was supposed to be an "upgrade,'" (August 2008-June 2010).
• Kirkwood Community College, IA, "Cost scaling (no non-FTE multiple node options – $25k-ish for more than 2 nodes, more than one branded domain required Vista level - an extra $45k annual or so), features (gradebook features and functions, report/event triggers for at risk students, ability to assign standards to sections, LOR seemed to work better than CE, multiple domains, rss feeds, web interface from normal to pda to light-weight at the click of a mouse), multi-tiered administration levels, not 99% dependant on Java working for students, the ability to view faculty/student course issues without having to add/remove yourself from the section roster everytime (use assume role, use “login as user” overrides), better chat/whiteboard controls and features, pre-login announcement functions. I know I’m missing around 15 – 20 more things identified by faculty/staff when the systems were reviewed by our LMS change project members. BB was dead last (and we were presented the NG concepts and visions by BB) – Angel came in #1, Desire2Learn #2, " midway through migration now.
• Lansing Community College, MI, moved from Blackboard to Angel in summer 2004. ( may have been 2005, not sure - memory gets foggy). Primary reasons: 1. BB raised prices significantly, 2. BB uptime & bug fixes were poor. Given those reasons to leave BB, Angel was chosen from a wide survey of possible vendors by a faculty vote because: 1. promised easy conversion of course content from BB to Angel, 2. additional features in Angel (esp re-grading quizzes), and 3. a razzle-dazzle sales presentation & full-court blitz by Angel sales team.
• Laramie County Community College, WY, "moved from WebCT (after it was taken over by Blackboard) to ANGEL. In our LMS search, Blackboard was too expensive, it lacked customer support, and they weren’t very willing to set up sandbox courses and/or send a rep to do a live demo of their product. All these issues were exactly opposite with ANGEL and even D2L (our second choice)."
• Manatee Community College, "We moved from WebCT 4 (were going to go to CE6) after it was taken over by Bb because we began hearing horror stories of poor service and poor product."
• Mohave Community College, "We moved as well last year for the same reasons (as others listed): support, price, features."
• National Park Community College, AR, "My school switched to ANGEL two years ago. We had been with Bb (basic) for quite a few years. The prices to switch to Enterprise version were too costly and we were tired of lousy customer support, so we sought out ANGEL."
• North Central Texas College, TX, "We moved from BB Classic to ANGEL in June 2005 because we were dissatisfied with the level of customer support (none) and the significant difference in cost for BB add-ons that were built into ANGEL."
• Northeast Community College, "We moved last August from CE 4.1 to Angel specifically because of lack of support from BB/WebCT and Angel had more features ready and working at the time versus the NG product not being out for a few years."
• Richland Community College, IL, Richland continued using BB/WebCT product "until this semester, when a few of our faculty began piloting Angel in preparation for a complete switch to Angel, which begins this summer. We left BB/WebCt because the cost was prohibitive and because BB’s support department was unresponsive to many of our problems. We would submit trouble tickets and get a 'this will be fixed in a future update' message, only to find that fix after patch after update would go by without addressing the problem. We had several unresolved problems (some nearly 2 years old) by the time we began talking to Angel, and our faculty were extremely frustrated.
• Santa Fe College, FL, "We moved from WebCT CE 4.1 because it was no longer supported and we wouldn't be able to get a new license. In deciding what to move to, we kept BB off the list because of the lack of support, etc. that we were experiencing as well as the patent lawsuit issues. We narrowed it down to Angel and D2L, and after polling our faculty (after demos from both companies, etc) 93% of the instructors either didn't care or wanted Angel."
• State Fair Community College, MO, just switched from Blackboard to ANGEL.
• State University of New York (SUNY) at Fredonia, "Bb was too expensive, didn’t address bugs, wouldn’t let us query the DB or install it on a test server without paying double the license fees. We moved to ANGEL because our faculty liked it the best of all the options."
• University of Kansas Medical Center, KS, "KUMC moved to Angel approximately 2.5 years ago. Why? Money."
• Washburn University, KS, Washburn (is) moving from Blackboard to Angel because the system is reportedly easier to use for both faculty and students, " further, during "the evaluation process they failed to respond to some of our requests for information. Some of us felt like that might be an omen about their future support," pilot this summer and fully transitioned this fall.
• WashingtonOnline (WAOL), WA, "just moved in January 2009 from BlackBoard to Angel. WAOL consists of 34 community colleges in Washington State."
• Washington State University Spokane, "moved primarily because of the sudden and unreasonable price increases (separating out campuses into individual licenses) with non-negotiable Blackboard sales people."
• Wichita Area Technical College, KS, "we were not please with the levels of support after the take over of the Blackboard product...It was a natural that we would choose Angel and made that decision last fall, not long after the semester started."

The theme throughout is pretty uniform, cost and poor quality product and service. I've been considering what action anyone can take in light of this development and there seem to only be two options:

1. Find another LMS and drag faculty and support staff through a major transition. I'm not sure how viable that option is for institutions. JCCC is half way through a two-year transition having spent tens of thousands of dollars for the new product, continuing to pay for a license for the old product, hardware acquisition, training and support.
2. Find a way to stop the merger.

The second option caused me to wonder if the Federal Trade Commission (FTC) has a role in approving this merger. Their web site (https://www.ftccomplaintassistant.gov/) indicates that "The Federal Trade Commission, the nation's consumer protection agency, collects complaints about companies, business practices, identity theft, and episodes of violence in the media."

So I filed a complaint based on "monopolistic business practice in distance learning field." To file a complaint you also need the company's contact information (here it is):

Blackboard Inc.
650 Massachusetts Avenue N.W.
Washington, DC 20001-3796
(202)463-4860
http://www.blackboard.com/

I skipped the page about how much the company asked me to pay and so on and entered my personal information so the FTC can contact me.

When asked to describe my complaint, here's what I wrote:

Blackboard Inc. licenses two learning management systems (LMS): Blackboard Campus Edition (formerly WebCT and acquired when they purchased WebCT 2-3 years ago) and Blackboard Academic Suite (their original product). Numerous schools, Johnson County Community College among them, have chosen to cease licensing Blackboard and are in the process of migrating to a different LMS, primarily ANGEL offered by ANGEL Learning. This migration is specifically related to cost and the lack of customer support and responsiveness to the customer. This past week Blackboard Inc. announced that they have acquired/purchased ANGEL Learning, thus eliminating one of the last non-Blackboard Inc. options available to institutions offering online instruction.

Further, Blackboard has an on-going patent infringement case against another competitor in the LMS field, Desire2Learn. Blackboard appears to be trying to shut down competition either by purchase or by legal action. Their patent claim is disputed by most industry leaders and has been thrown out at least once by the court but the decision has been appealed and a second patent claim filed by Blackboard against Desire2Learn.

If you check my blog at http://angeliclearning.blogspot.com you’ll find several postings on this issue including the May 10, 2009 posting that lists institutions that have experienced poor customer service and an inferior product line since the merger of Blackboard and WebCT. Our concern is that Blackboard through monopolistic practices is reducing the viable alternatives in the field and forcing the higher education customer base to use Blackboard product(s) because other options are ceasing to exist.

We ask the FTC to review this merger/acquisition to determine whether allowing the process to continue creates a monopoly and dampens competition and whether the needs of the higher education community are served or jeopardized by the acquisition.

So, my guess is one complaint may be largely ignored. A rash of complaints may generate some action. Anyone else willing to take 10-15 minutes to file a complaint with the FTC?

Dream Scenario

After the announcement on Wednesday of the Blackboard acquisition of ANGEL (see http://angeliclearning.blogspot.com/2009/05/dark-angel.html), here’s my dream scenario:

• Blackboard acknowledges that it acquired ANGEL because they recognize ANGEL a superior product. Blackboard provides a migration route from Blackboard (classic) and Blackboard CE to ANGEL and encourages/pushes existing clients to switch to their new product: ANGEL.
• Recognizing the inferior support provided by Blackboard and the highly esteemed good quality support offered by ANGEL, Blackboard maintains and expands their Indianapolis-based “ANGEL” tech support center. Former “Blackboard only” tech support staff must vie for a position (based on quality of service) to remain with the company based on their knowledge of ANGEL.
• Blackboard recognizes you can’t squeeze the “golden goose” too much or you get crap rather than golden eggs so they decide to freeze price increases for 3-4 years while they get their “house in order.”
• Enhancements are made to ANGEL in a cautious by timely fashion.
• Blackboard finally ditches its “dark side” and becomes Whiteboard Inc. or simply “ANGEL Learning.”
• We all live happily ever after.

Blackboard Monopoly Grows, Buys ANGEL

An email message from Michael Chasen, President & CEO of Blackboard was sent on May 6, 2009. The text follows (see additional links at the end):

Chasen Message

I'm writing today to communicate the news that Blackboard has acquired ANGEL Learning and to share with you some of the thinking behind the combination.

Why put these two organizations together? This combination was about getting better. At Blackboard we're always trying to improve, both by focusing internally within our company and by looking externally to other organizations we admire, like ANGEL. We admire them not just for their story of entrepreneurial growth and impact on teaching and learning, but also for very specific strengths that we wanted to add to our story and deliver to our clients:

- The first is their customer support culture that has translated into consistently excellent experiences for ANGEL clients. We can learn from their skill in this area and add their know-how to the ever improving client support capability we're building here at Blackboard.

- The second is their history of innovation - especially in the areas of user experience, teaching and learning tools and course-based assessment. Independently our two offerings have led the way in a lot of areas. Now we have the opportunity to bring these strengths together for the benefit of learners in our Project NG vision for the future of the Blackboard platform.

From ANGEL's perspective, and especially in today's economic environment, joining these strengths with Blackboard's own innovation, industry leadership and financial stability also made a lot of sense.

At the ANGEL Users Conference in Chicago next week we'll be talking about how the solutions will come together and will send you an update after we get back. The short story is that ANGEL's latest release, ANGEL LMS 7.4 which launched last week, will continue as planned. In parallel we'll set about the work of bringing the product innovations of both companies to the new combined client community.

As we move forward and knit our organizations together, we’ll continue to be very focused on the client experience. That means drawing on what we’ve learned from previous integrations and minimizing distractions while weaving the best of ANGEL into the tangible value you get from working with us every day. More than anything, today’s news directly supports our top goal of continuing to bring clear added value to your investment in Blackboard.

You can learn more at www.blackboard.com/angel, but please feel free to contact me (CEO@blackboard.com) or your Blackboard representative if you have any questions or comments.

In closing, thank you once again for your institution's partnership with us. We look forward to showing you the benefits of this latest step in our ongoing effort to be a stronger, more flexible and creative supporter of your teaching and learning goals for the near and long term.

Additional Links:

Press Release: http://tinyurl.com/covjjm
Reactions: http://tinyurl.com/co7axa
FAQs: http://www.blackboard.com/resources/company/FAQ_ANGEL_BLACKBOARD_Acquisition.pdf
Inside Higher Ed Article: http://www.insidehighered.com/news/2009/05/07/bb
Campus Technology article: http://tinyurl.com/d444gm
Washington Post Article: http://www.washingtonpost.com/wp-dyn/content/article/2009/05/06/AR2009050603933.html