Few corporate brand names in education are as recognizable, and as polarizing, as Pearson, the giant education provider whose reach extends to virtual schools, testing, language training and an array of other areas.

Many educators these days see Pearson as the embodiment of commercial businesses’ continued push to turn profits from public schools. Pearson has been criticized for everything from its deployment of curriculum in districts’ 1-to-1 technology programs to the prominent role it plays in high-stakes testing.

Yet by its financial measures—including its $7 billion in annual revenues—Pearson is clearly providing products and services that are in demand in many schools, districts, and states, and among individual parents.

Pearson CEO John Fallon recently met with a group of reporters at Education Week’s offices and spoke about his company’s business strategies and record, and offered a defense against some of its detractors’ claims. He also talked about how he thinks policy shifts like the implementation of the common-core standards and the adoption of “open” educational resources are likely to affect the K-12 market, and his company’s work.

Here are takeaways from Fallon’s remarks in response to questions from a group of reporters, edited for brevity and clarity.

Pearson officials have been talking about shifting away from being identified as simply a publishing company for years now. Fallon described the scope of the company’s reach in different areas of K-12, higher education, and professional training.

Pearson’s annual revenues stand at about $7 billion, of which 50 percent come from courseware/content, in K-12, higher education, and across the professional space, Fallon said. Those resources are increasingly delivered in digital form. Thirty percent of the company’s revenues come from assessments of one kind or another, which includes professional certification and apprenticeship programs, as well as summative exams.

High-stakes testing, specifically, produces “less than 10 percent of our revenues, but feels sometimes like it generates 150 percent of the news flow,” quipped Fallon. 

The remaining 20 percent come from services provided to schools and colleges, including virtual schools, [and] online program management at universities, he said. A Pearson business motto is “content plus assessment, powered by technology, equalizes effective learning at scale,” Fallon said, and after years of striving for that goal, “we only feel that it’s really now starting to come together.”

The company’s approach is to “define what we do by the outcome, not by where it happens physically,” he said. Pearson will continue to support “some pure online programs,” Fallon added, and “online program management and virtual schooling are two of the biggest areas of growth for the company. The weight of the activity will be in blended learning, and how you combine the benefits of face-to-face with purely online approaches.”

Pearson is a major player in virtual schooling, through its operation of Connections Academy and other programs. Recent studies, including one by Stanford’s CREDO project, have shown virtual schools producing poor results. Fallon was asked why parents and others should have confidence in Pearson’s online schools, despite the negative findings for virtual education.

“It’s important to speak in specific rather than general terms…It’s not always the case, but it’s fair to say there’s a disproportionate number of students in virtual schooling who are there because physical schools have failed them in some form or another. So it’s going to be important that we track value-added, or progress-added.

“We see technology as the means by which I can apply the benefits of teaching to far more people, and you can help free teachers up to spend more time with students, engaging students, learning from each other. Technology is not a panacea, it’s just a tool, and its primary value is in enhancing the power of teaching to reach more people.

“We publish studies that show the value that these programs do add. I think on the whole, the results are pretty good….But we are not complacent or satisfied, and all the time we’re looking to improve the value that is added. If you look at Connections Academy, the schools are incredibly popular with parents…[We measure the extent to which parents recommended our online programs among each other] and it receives an incredibly high rating.”

Many critics accuse publishers, including Pearson, of making exaggerated claims of having aligned academic materials to the Common Core State Standards, while having only made superficial changes.

Fallon was asked by EdWeek reporters about a review of a Pearson curriculum by the organization EdReports that gave one of the company’s curricula a poor rating for common-core alignment. Fallon official pointed a  response by the company that argued that the EdReports analysis was flawed, and he said Pearson’s overall record in aligning its materials to the common core is “very good,” overall.

“We’re very confident that our products are aligned to the common core. The principles of the [standards] are hugely empowering and inspiring for teachers and publishers as well. It moves us from a world under No Child Left Behind where we were essentially teaching and assessing a child’s mastery of mathematical formulas and equations to a world where we’re teaching and assessing a child’s ability to solve real world problems, and more sophisticated problems.”

[O]ne of the mistakes that were made around the implementation of the common core was to think you could switch from No Child Left Behind, that you could click your fingers and it would happen in one fell swoop. It will take the better part of a generation for the benefits to flow through.John FallonCEO, Pearson

But he said the implementation of the common-core is a massive task, and that support for educators and schools in making a transition to the standards has been lacking—one of the factors that has fueled mistrust in the K-12 community.

“You have to work with the gray—that is the day-to-day reality of the classroom. We [made] probably the biggest single investment [in the Pearson System of Courses, which] completely rethinks the way that numeracy and literacy are taught in the classroom. It would be the absolute poster child for the common core, and the new way of teaching…in the long run, it will prove incredibly liberating for the profession. But it is not a simple, straightforward thing to implement a program like that. It will take years, it will require very significant amounts of professional development. It will require you to rethink how the working day in the school operates. Those things take time.

“In hindsight, one of the mistakes that were made around the implementation of the common core was to think you could switch from No Child Left Behind, that you could click your fingers and it would happen in one fell swoop. It will take the better part of a generation for the benefits to flow through, because it’s such a fundamental step change. Frankly, where a lot of support from the teaching profession for the common core tipped over into antagonism, and concern, was because of the way the assessments were introduced. For example, there wasn’t an understanding in terms of tracking and measuring teacher performance against those standards; you needed to give a significant amount of time for it to bed down. Now, the reality is that it happened in the end, but it was done slightly late in the day, and almost grudgingly. It would have been so much better if everyone had been more open and honest about that much earlier in the process.

Big changes were required, yes, of publishers, but also huge changes in the way that schools were administered and led, and in the training of teachers. It’s a big, big change….You have to deal with the reality of life in schools…it varies by district, [there’s] variation by state, and not every school can move straight to a very different style of curriculum. It will take time.”

Fallon sees major educational benefits in the types of summative tests delivered today by Pearson and others, despite criticism of high-stakes exams, and despite frustration caused by testing breakdowns. [Pearson was recently faulted by New Jersey state officials for a disruption of that state’s assessments.]

“The move toward a world of fewer, better, smarter assessments that provide more actionable data more quickly to teachers and parents is important. We would say that an assessment should be only one measure of progress. It should be part of a richer dashboard, a more holistic view.

“We’ve been talking for 20 years about the convergence of formative and summative assessment, something the Every Students Succeeds Act makes more valid…that is something in our sights, something that is possible, in psychometric terms, in terms of technology—fewer, better, smarter assessments, and quicker, better feedback for teachers, parents, and students.”

McGraw-Hill Education got out of high-stakes testing entirely last year. Given the continued controversy around summative exams, and periodic problems associated with giving them, could you see a day where Pearson says goodbye to high-stakes testing entirely?

“Just to put it in context, Pearson successfully conducted 15 million on-screen tests last year. We did, as you know, have a problem in New Jersey, and we’re sorry about that. But the tests resumed the next day, and have been very effective since then. Our onscreen testing is very reliable, secure, it works, and we can provide much richer data, and we can provide useful information back to teachers and parents. And it’s what enables formative and summative assessment to converge. It’s much harder to see that if we go back to the world of paper and pencil, bubble tests….they’re not fit for what we need to prepare young people….to apply things to the real world.

“I can’t speak for other companies, but I have a lot of confidence in the reliability of our online assessments. Secondary, they will enable what most people in the education world want to see happen.”

Pearson was one of the companies, along with Apple, that was faulted as the Los Angeles Unified school district’s 1-to-1 iPad program, faced technical breakdowns and backlash. Pearson’s common-core aligned curriculum was supposed to come pre-loaded on iPads, and the company was criticized by those who said it wasn’t ready. The company recently agreed to pay more than $6 million to the district.

Fallon would not comment on the specifics of the settlement, but said this when asked about what lessons the company learned in L.A.:

“Moving to 1-to-1 learning, to where the role of the teacher becomes much more one of coach and [providing] support to children, where you’re trying to introduce more peer-to-peer learning…and do so in a technology delivered-world, that is a very different world than the reality that exists in many schools today. And it takes time. And the lessons to be learned, not just from there but around the country, are that there is still a lot of work to be done, to get really good, high-quality…e-commerce-grade tech infrastructure and experience in schools for students. That’s not to say there has been a lot progress—there has…But I think that is a prerequisite over time to giving teachers competent ways to deploy technology effectively in schools.

“And where you call it common core, or career-and college-ready standards, the ambition to the new higher standards, one that is much more around applied knowledge, is another very ambitious thing to do. You’ve got a lot going on, all at once. How you manage systemic change in those circumstances is not something you should underestimate. It will take a lot of time to do. It’s a real focus on technology infrastructure, a real focus on PD for teachers.”

And about the specific accusation that Pearson’s curriculum was not ready in time for LAUSD?

“That program has continued to be used in a number of school districts around the country, which are running pilots on it. The curriculum on it is fantastic. And if there’s any program that really did try to fully embrace the common core—and wasn’t just compliant, but went beyond—that was it.”

Many districts have embraced open educational resources—free materials created on licenses that allow their distribution, re-use, and repurposing. Fallon argued—as many providers of commercial materials have—that OER can provide benefits to some schools, but that commercial resources will continue to have value because of the tech-based enhancements, in analytics and adaptive learning and other areas, that they offer beyond academic content.

Open resources are “an important part of the landscape…Quite often, they’re used as supplements to a core teaching program. If you think about what the next generation of technology will look like, it’s a really immersive learning experience, that will provide learning analytics that enable teachers to have more actionable diagnostics that give them more personalized information around each student and creates much more personalized learning for students.

“That’s not something that can be done without continuous and sustained investment, and that investment has to funded from somewhere. Ultimately, it has to be paid for somewhere in the system. That’s why I think there will be a diversity and range of [materials]…I think there will continue to be a market for a long time to come for high-quality courseware, pedagogically sound, fantastic content, developed in a way for teachers that is an inspiration for them to teach and for students to learn, and [which is] providing much more adaptive learning and learning analytics. But it will be paid for if it demonstrates real value [in]…helping more students to be successful and make progress. If it doesn’t, it won’t, and it won’t deserve to.

“If [the education community goes] that [open] route, it’s not a free route. They will have to find a way to fund and sustain that approach. They might be able to fund it over time with voluntary labor extended over time from the teaching profession. But there’s a consequence for that; there’s only so many hours in the day, in the system…If you talk about ‘free’ in any other sector, [the resources] may be free at the point of use, but they’re being funded and paid for somewhere else. So ultimately, quality has to be paid for somewhere else.”

Photos of Fallon by Charlie Borst, Education Week’s director of photography.

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See also:

• Districts Put ‘Open’ Educational Resources to Work
• Curriculum Prompts New Concern in L.A. iPad Plan
• Cyber Charters Have ‘Overwhelming Negative Impact’ CREDO Study Finds