Surge in Online Courses
The Internet is also a catalyst for change. U.S. enrollment in online virtual classes reached the 1 million mark last year, 22 times the level seen in 2000, according to the North American Council for Online Learning, an industry body.
That's only the beginning, said Michael Horn, co-author of "Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns".
"Our projections show that 50 percent of high school courses will be taught online by 2013. It's about one percent right now," said Horn, executive director of education at Innosight Institute, a nonprofit think tank in Massachusetts.
K12 Inc, which provides online curriculum and educational services in 17 U.S. states, has seen student enrollment rise 57 percent from last year to 41,000 full-time students, said its chief executive, Ron Packard.
Much of the growth is in publicly funded virtual charter schools.
"Because it is a public school, the state funds the education similar to what they would in a brick and mortar school, but we get on average about 70 percent of the dollars," Packard said.
"We don't usually get capital dollars, or bond issue dollars. Sometimes we don't get local dollars. So on average it works out 70 percent of the per pupil spending that an average school in the state would receive," he said.
"We're getting the kids who the local school is not working for. And the spectrum goes from extreme special education to extremely gifted kids," he said.
U.S. investment bank Morgan Stanley says K12 and similar companies look set to capture an increasing share of the $550 billion publicly funded U.S. education market for children aged from about 5 to 18 as more U.S. states adopt virtual schools.