Changing climate in the ICT sector

8th September 2000 at 01:00
With mergers and acquisitions abounding among the big players in television and multimedia, Chris Johnston tracks development

BRITAIN'S EDUCATIONAL information and communications technology sector is undergoing one of the most dramatic upheavals of its short life.

Granada Media's recent takeover of United News and Media's three ITV licences, including Anglia Television, will see Granada Learning absorb the operations of the Norwich-based operator's Anglia Multimedia business.

Granada Learning, which bills itself as the UK's leading educational multimedia company, is in an ambitious acquisition phase following its pound;19.65 million purchase in June of NFER-Nelson, which provides test and assessment products. It has also bought Letts, publishers of school and home study guides.

Steve Morrison, chief executive of Granada Media, said these and other acquisitions were part of the company's desire to become the UK's leading e-learning business.

Peter Stibbons, chief executive of Anglia Multimedia, said he was "extremely positive" about the prospect of a merger with an organisation so committed to education. "Granada Learning has a clear vision of what learning will be like in the electronic age," he said.

Combining Anglia Multimedia and AngliaCampus, the online service for schools it operates with BT, with Granada Learning "will create a major broadband education business", according to merger documents.

Paul Warren, corporate finance executive with analysts Capital Strategies, said Granada was looking to the home market as well as schools and would offer content on both the Internet and digital TV.

The merger means it is almost certain that the BBC and Granada will share a overnment contract to develop interactive GCSE modules for digital television. The two organisations and Anglia Multimedia had participated in trials earlier this year and a report, scheduled for May, is now expected in October. Granada is approaching the level of influence of education's biggest ICT firm, RM, which has just signed an important cross-licensing deal with US firm Riverdeep on interactive online content.

Meanwhile, Pearson, the world's largest educational publisher and owner of the Financial Times, has set its sights even more firmly on the education market with the $2.5 billion (pound;1.67 billion) purchase of US firm National Computer Systems in late July. NCS is the US's largest provider of student, curriculum, teaching and financial management software for schools and the biggest commercial processor of student assessment tests for primary and secondary schools.

Pearson also bought British publisher Dorling Kindersley for pound;311 million at the end of March. It promptly dismantled DK's distribution network, and no new CD-Roms will be published after December according to Peter Kindersley, who banked pound;105 million from the sale, has set up a foundation to support online pre-school educational projects, underprivileged children and the environment.

Despite the consolidation of the UK educational multimedia sector, Mr Kindersley said he did not believe small software developers would be squeezed out of the market.

Larger companies would increasingly rely on them in the same way TV networks depended on independent production companies for programmes and new ideas, he believed.

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