E-learning is not just an application of technology to teaching, but a new business model for higher education. By approaching e-learning as a business model, educational policy makers can begin to appreciate the scope of the integrated technology and services required to run a successful online degree programme or a blended programme that includes online courses. A strategic consideration should be whether to develop and/or deliver components of an e-learning business model solely with in-house resources or with one or more outsourcing arrangements. An e-learning business model framework is presented to help policy makers develop a unique model for their own institution. An e-learning ‘revenue engine’ is presented to tie the framework's components together conceptually. Finally, a set of e-learning outsourcing decision factors is presented, including an analysis of an internal versus outsourced cost structure. It is argued that UK HEIs should outsource components of their e-learning business model to realize greater operating and cost efficiencies.
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