The nail is in the coffin for Amplify. In its earnings report for fiscal Q4 2015 released today, News Corporation announced it has “initiated a strategic review of its Digital Education segment.” Specifically:
Amplify Access is the name of the tablet division, which has largely failed to gain traction in the education device market. In February 2015, the head of that division departed, signaling a major reshuffling of personnel and product priorities.
The Digital Education division saw $24 million in revenues from April to June 2015, up from $18 million during the same period in 2014. The division cut EBITDA losses from $53 million to $24 million during this period, respectively, from 2014 to 2015. For the full fiscal 2015 (ending June 30), revenues increased to $109 million, a 24 percent improvement over the previous year. EBITDA losses decreased by $100 million to $93 million for the fiscal year.
Cutting losses won’t be enough for News Corp. to keep Amplify. On the company’s earnings call, Chief Financial Officer Bedi Singh admitted the the market for digital curriculum has been “disappointing” and “much slower to develop than we expected.” He adds: “We are at advanced stages of reviewing strategic alternatives at Amplify.”
Chief executive Robert Thomson offered a much clearer direction on Amplify’s future: “You can take from our messaging today that we are in the final phase of negotiations with potential acquirers.”
News Corporation paid $390 million to acquire Wireless Generation in 2010, and has invested upwards of $1 billion into Amplify.
UPDATE (4:35PM PT)
In an email obtained by EdSurge, Amplify CEO Joel Klein confirmed that the digital education division will indeed be changing hands:
Klein also reflected on the challenges Amplify faced in getting schools and districts to adopt its tools, starting with the tablet:
But even the digital curriculum products, covering English Language Arts, math and science, struggled to gain a foothold. Klein acknowledges
Klein appears to suggest that Amplify's tools were, ultimately, too cool for school: