The PIE News has some useful numbers regarding which tests were used by students entering the UK for studies in the 23/24 enrollment cycle.  The numbers come from Enroly, which apparently processes a third of all international student applications for the UK.

It reports that about 65% of students took an English to show they met the language requirements for a student visa.

About 34 percent of students used an IELTS score to meet those requirements.  About 8 percent used a PTE score.  About 10 percent used a score from one of the other SELT tests.  About 13 percent used a score from a non-SELT test.

TOEFL and Duolingo are the biggest non-SELT tests, but there are others.

IRCC has announced that language score requirements will be added to the PGWP application process.  University graduates will need a score equivalent to CLB level 7 and college graduates will need a CLB level 5 equivalent. A list of acceptable tests hasn’t been given, but one imagines that IELTS General, CELPIP and PTE Core scores will be accepted (as they are for PR applications at this time).  In case you are wondering, an IELTS score of 6 is equivalent to CLB level 7.

I’m not sure of the usefulness of this requirement, as most students are required to meet similar requirements while applying to schools in the first place. But including it amongst the announced changes likely helps the minister establish the tone he’s going for.

Note, also, that a PGWP application is usually followed by a PR application, something which requires similar language scores. I suppose students will use the same scores for both applications. This makes the change not a particularly big deal, from my perspective.

In some cases, though, the change could result in students taking similar tests three times – when applying to universities, when applying for a PGWP and when applying for PR.  Test companies must be happy right now.

These Google Trends graphs for the past ten years are mildly interesting. They hint at an increasingly competitive market for English testing in India (but one impacted by forces beyond the control of testing companies). They also hint at a gradual embrace of the IELTS in East Asia markets where the TOEFL has traditionally been the number one test.

Recently I spoke to an ed-tech entrepreneur who had just returned from doing market research in El Salvador. Everyone there told him he needed to ensure that his tech could help students prepare for the TOEFL. I encouraged him to do that as well, but reminded him of trends in the rest of the world.

Michigan Language Assessment  is conducting a concordance study that will compare MET and IELTS (academic) scores.

Individuals who have recently taken the IELTS or will take the IELTS in the near future are invited to apply to join the study.  Those selected for the study may be eligible for a free in-person administration of the MET and/or reimbursement of IELTS test fees.

Best to act quickly, as both tests must be completed before October 25.  Note that only in-person administrations (of both tests) are eligible for the study.

The MET is one of many tests that I’ve been watching from the periphery, but don’t know nearly enough about. I suppose I should add an administration of this test to my queue.

The PIE just published a useful summary of the ownership structure of the IELTS test.  It can sometimes be tricky to wrap one’s head around the ownership of the test, which is shared, equally, between Cambridge English, the British Council (both non-profit organizations) and IDP Education (an Australian for-profit).  Making things even trickier is the fact that the latter two parties compete with each other to deliver the test in some (but not all) markets. One might predict friction between these parties, but they seem to get along pretty well.

As the PIE points out, the British Council may be “the logical choice” to develop the new English test that the Home Office has put out a tender for (currently referred to as the “HOELT” test). This makes sense considering their worldwide network of testing centers, and IELTS’s current status as a market leader.  But since Cambridge is responsible for the design, development and validity research of IELTS test items, perhaps a more likely front-runner is a new partnership between that organization and the British Council. Note also that the tender seems to invite separate bids for the development and delivery of the test, but how that would work in reality isn’t immediately clear.

That said, a question that comes to mind is whether an IELTS-ish test is even desirable. Is it safe to assume that this is what the Home Office is seeking?

Here’s a bit from a review of the IELTS by John Read published in Language Testing back in 2022:

“As its recent history shows, IELTS has been successful in incorporating technical innovations in the delivery of the test and in a whole range of back-office functions that support the industrial scale of its operations. However, in its adherence to design principles dating from the 1980s, it has proven resistant to any fundamental re-thinking of the construct of academic language proficiency in the light of current concerns in the field, such as the renewed focus on integrated tasks, the importance of assessing interactional competence, the value of diagnostic feedback, and the diversity of academic literacies. Although there are numerous IELTS-funded studies by external researchers suggesting ways in which [the] test could be enhanced, there is no sign of an integrated programme of renewal of the test.”

Keep in mind that the review isn’t all bad. But needless to say, a test like the IELTS has pros and cons.

If the Home Office is seeking a more modern approach to testing, perhaps there is an opportunity for a firm already known for producing such products.  That’s a big “if,” of course, but it is worth considering.

Shocking news out of the UK this morning.  The PIE is reporting that the UK Home Office is reconsidering how it handles Secure English Language Testing .  Rather than accepting results from a handful of approved tests, the Home Office is considering instead a single test, owned by the Home Office and designed by one supplier.   Says the PIE:

“The government appears to be planning to move away from the current concession model based on multiple Home Office-approved suppliers, to a dedicated test owned by the Home Office and designed by one supplier.

The service, carrying an estimated contract value of £1.13 billion, will cover the development and ongoing support of a Home Office branded test to be used globally for all HOELTs, and the facilitation of tests around the world.”

Read the whole tender here.

As most readers know, SELT-approved tests are those tests which are approved by the Home Office for visa and citizenship purposes.  They are delivered at test centers that meet the strict security requirements set by the Home Office.  Testing providers must also meet certain post-test requirements.  SELT-status is highly valued in the testing industry.

Within the UK, these tests are currently delivered by the IELTS partnership, Pearson, Trinity College and LanguageCert.  Outside of the UK, tests are delivered by the IELTS partnership, LanguageCert, Pearson and PSI.

The aforementioned change would represent a seismic shift in the language testing world.

A few thoughts and questions come to mind:

  1. It takes a very long time to develop a test.  Many years of research and development are required.  Would a Home Office-owned test end up being a variation of an existing test?
  2. Aside from the above-mentioned organizations, who might be capable of bidding for this tender?  Keep in mind that PSI is a subsidiary of ETS. 
  3. I would like to know more about the financial implications of this change.  How impacted would some of the major testing firms be by the loss of SELT business?  Perhaps some representatives of those firms will chime in. 
  4. Perhaps someone who follows the industry more closely than I do might wager a guess at how likely it is that the Home Office will actually go in this direction.  Obviously it is not set in stone. 
  5. If this change is implemented, will other governments follow suit? 
  6. Regular readers of this space know that I value competition. I feel that testing monopolies can sometimes be bad for test takers.  This change could reduce competition in the testing space. 
  7. I also value accessibility.  Accessibility is impacted by the number of approved test centers available to test takers, and how close they are. This change could reduce the number of test centers available to test takers.

I’ll post more news as it becomes available, obviously.A big thank-you goes to Polly Nash for digging this story up. Apparently the tender was put out during the holiday and went unnoticed by all but her.

Yesterday, IDP Education released its financial report for FY2024.  You can also read an annual report.

Regarding the IELTS test, a few things are worth mentioning here.  They are:

  1. IELTS test volumes are down 18% worldwide.  They stand at 1.58 million tests for the year.
  2. IELTS test volumes are down 42% in India.
  3. Outside of India, things are rosier: IELTS test volumes are up 12%.
  4. IDP says they “expect to record a decline in volumes in [their] key business lines in FY25.”
  5. The annual report indicates that 3.98 million IELTS tests were taken in the year (including those administered by the British Council).

IDP Education seems pretty determined to convey that IELTS declines are due to regulatory changes in Canada, Australia and the UK.  And that competition from other tests is not a major factor.  I don’t know if I buy that.  I think competition from Pearson and Duolingo is having a serious impact. But I’m just a guy on the Internet.  What do I know?

I listened to the shareholder’s call and about 30 seconds of it really captured my attention.  CEO Tennealle O’Shannessy said:

“We completed a strategic review of the mainland China market. Off the back of that, we are exploring a direct testing model in China. We’re at the early stages of this process, but we believe that over time this will open up additional growth for us as we connect directly with a greater number of test takers and students in China.”

Currently in China, the British Council alone administers the IELTS test (in conjunction with the NEEA, which is part of the Ministry of Education). Based on an agreement between IDP and the British Council, the British Council pays IDP a fee for each IELTS test that is taken in the country. This arrangement dates back to 2001.

What O’Shannessy seems to be suggesting is the  sunsetting of this arrangement in favor of IDP Education directly administering IELTS tests themselves in China.

This could be advantageous for both IDP and test takers. But, as is well known, China can be a tricky place to do business.

The IELTS partnership is picking up the pace! According to a new press release, people who take that test on a computer can now “usually” get their results in 1-2 days. That’s impressive for a test that is graded wholly by humans.

For the record, Pearson says that PTE scores “typically” arrive within two days. Duolingo says that DET scores arrive in two days (and no adverbs are used).

ETS still promises TOEFL scores in 4-8 days. They might have to speed things up in order to remain competitive.

Pearson just posted interim results for the six months ending June 2024. I’m traveling right now and can’t provide a full write-up, but a few things ought to be quickly noted:

  1. PTE’s volume dropped to 546,000 for the 6 months, down 10% compared to the same period in 2023. Pearson predicts “flat to down” growth for the remainder of this year. Note that IDP has suggested IELTS volumes will be down 15 to 20 percent for the year ending June 2024. It’s a tough market for English tests right now.
  2. They note that the PTE “has continued to see market share gains, particularly in India and China.”

A commenter who prefers to remain anonymous wrote the following when I posted about the results to LinkedIn last week:

…if 100 students who [took] an English Language Test in May 2023, 80 of them would be for the IELTS test and 20 for the PTE test.

However in May 2024 the pattern has actually reversed with more people preferring the PTE exam than the IELTS.

This is the situation that I’ve seen in Kerala, India.

Including the last few stragglers, 16 international students at Columbia University reached out to me for help with the ALP Essay Exam (need help?  Contact me!) for this year’s fall term.  As always, I asked them what tests they used to get admitted to the school in the first place.  The results were:

  • Duolingo English Test – 15
  • TOEFL – 1
  • IELTS – 0

When I ask questions like “what went wrong with TOEFL?” I am sometimes accused of being too harsh. But clearly something has changed. Pre-pandemic, there is a good chance that every one of those students would have taken the TOEFL.

Individuals who don’t talk to test takers every day and who don’t teach this stuff one-on-one can miss trends in the industry that ought to be obvious to everyone.  Speaking of what went wrong at the legacy testing firms… that might have something to do with it.  There may be too many degrees of separation between executives and customers.

Anyway.  Of course I asked why they all took the DET.  Most mentioned the price and convenience.  One mentioned that the cute characters put her at ease.  Another said that the university told him to take the DET.

A few poor souls might sit for the placement test in August. I’ll update this post if I talk to any of them.

Given the recent goings-on at IDP Education (layoffs and downsizing), I think it’s worth repeating my standard pitch for disruption in the English testing industry.  I posted this on LinkedIn a few days ago, but I realize that some very smart people don’t use that platform.

I’ll preface this by pointing out that while on stage at the Duolingo English Test Convention a few days ago I noted that I don’t think that the DET is more valid than other tests, or that it has better items.  Test items are not what make me a fan.

With that out of the way, here’s the pitch.

At the aforementioned DETcon, Duolingo co-founder Luis von Ahn told the story of his personal experience with language testing and how it informed (and continues to inform) the development of the DET.  He has told this story many times now.  In brief, it goes like this:  while applying for schools in the United States he needed a TOEFL score.  Sadly, there were no available spots at test centers in Guatemala, where he lived, and in order to meet his deadlines he was forced to travel outside of the country to take the test.  The cost was significant.

That was in the 1990s. I wasn’t doing test prep at that time.  But when I started teaching around 2010, it was still clear to many people that the test center model was less than perfect. People were still traveling great distances to take tests.  On top of paying for test fees, bus tickets and hotels, test takers experienced lost wages due to  travel times.  A $150 test could easily become a $1500 test.

But here’s the thing: in 2024, the test center situation is even worse.

I speak to test center operators now and then.  They tell me how their relationships with legacy testing firms have changed over the past decade.  Once upon a time, they tell me, they were paid a flat rate for a scheduled test administration, no matter how many people had registered for the given date.  But now, they complain, they are paid based on the number of registrants.

In effect, fewer registrations = less profit.

Can you see where this is going? The test center operators tell me that if there aren’t enough test takers to make an administration on a particular date worthwhile, they find a way to cancel it. When this happens, test takers are left in the lurch (deadlines be damned).  I hear from test takers who have experienced this.  Sure, they get a new test date at no cost, but they can kiss goodbye to the money they’ve spent on hotels and bus tickets.

See what I mean?  A bad thing has been transformed into something even worse.

But at-home testing is here to save the day, right?

Well, when the legacy players got into the at-home business back in 2020, their product (in my opinion) was pretty clunky.  Tests were often terminated for nebulous reasons.  Instructions were badly communicated. I still remember how one at-home test told every test taker to put on their headset just before the listening section started… but terminated the test whenever someone actually followed those instructions because wearing a headset was against the rules of the at-home test.  I’m not kidding. Apparently it took years for them to figure out a way to remove those instructions from the at-home version.

And in 2024?

Again, the product appears to be even worse. Back in ‘20 when something went wrong a person taking a legacy test could usually get a free re-test. But now? If something goes wrong test takers are often told to go pound sand. Back in ‘20 when a jagged score profile was used to justify a score cancellation the test taker could appeal the decision or simply take the test again for free.  But now?  The appeals process has been eliminated and they can take it again only at their own expense. I hear these things every week from heartbroken test takers. I end up with a broken heart, too.

And don’t even get me started on the legacy testing company that recently made big cash payments to at-home test takers after reaching a settlement with the US Attorney’s Office to resolve accusations that they had violated the Americans with Disabilities Act (which was not the first time that accusation had been leveled at that firm, by the way).

But maybe the move to at-home testing has eliminated barriers to education by reducing fees for people in countries where running test centers is expensive due to logistics and security-related issues?

Not really.

Today a kid taking the TOEFL from his bedroom in Japan will pay $199.  A kid in neighboring South Korea will pay $220.  Meanwhile, a kid taking the test from his bedroom in Afghanistan, who thinks an education might be a path to a better life, will pay $230.

A kid in the Palestinian Territories will pay $270.

All for the same at-home test, delivered in the same way, proctored by the same proctors, and graded by the same raters.

I’ve never really gotten an explanation for this.  My guess is that there are iron-clad deals in place with test center owners that prevent equitable pricing for the at-home TOEFL. But it could be something else.

In any case, things are not any better than they were when I started teaching in 2010. And that, in effect, is why I support disruption in English language testing.

I’ll end by reminding my friends at legacy testing companies that this is why many influential people are excited by the idea of disruption, this is why institutions are accepting new tests, and this is why test-takers are choosing those tests.

This is why, in part, there are so many layoffs. This is why you need to start doing better.

A few points are worth mentioning that I couldn’t fit into the above:

  1. Fees for some tests have increased way beyond the rate of inflation in certain markets, despite the fact that those tests include far fewer items than in the past.
  2. I talked to one test center owner in Germany who said he sometimes runs tests at a loss because he feels guilty about canceling dates.
  3. Charging $25 to send a score to an institution is no longer justifiable.
  4. If key parts of your test have been outsourced to private equity your test is likely doomed.
  5. It costs $450 to take the TOEFL from your bedroom in Switzerland.
  6. The next Luis von Ahn will pay $230 to take the TOEFL from his bedroom in Guatemala.  Or he might just opt for the DET.

IDP Education will lay off about 6% of its global workforce.  I’ve been told that some affected individuals have already received the news.

According to a “Regulatory and Market Update” released to investors, IDP predicts that the international education market will decline by 25% next year.  We’ll see. Caps will impact Canada and Australia volumes significantly, but interest in studying abroad remains high and other destinations will be beneficiaries of those moves.

The most interesting information in the update is stuff that has already happened.  It notes that in FY24 (which ends in June 2024), IDP expects to report a 15 to 20 percent increase in its student placement volumes.  But it expects to also report a 15 to 20 percent decline in IELTS volumes.

Shares are down 7.5% on the news.

I always try to sound like a broken record: old testing monopolies have been broken up and the market is more competitive and consumer friendly.  Students are voting with their wallets and hearts.  They are reaching for other tests.

Legacy test makers like the IELTS partners (and ETS) are required to innovate.  They seem to be aware of that. As this update notes:

“IDP has a strong focused roadmap of product development across its core student placement and IELTS business lines that it believes will underpin long-term shareholder returns.”  

I’m writing this from my hotel room at the 2024 edition of DETcon where I’ve learned that innovation is possible. It takes time and talent, though.

The business proposition will be tricky for IDP perhaps.  IELTS-of-the-future will not be a $300 test.  It will be innovative as heck, but it will be much more affordable.  Volumes will go up, and customer satisfaction will go up too. But I don’t know how it will impact long-term shareholder returns.

I spotted a wonderful article by Graham Witcomb in Intelligent Investor a couple of weeks ago about IDP and the language testing industry in general.

In it, Witcomb notes:

“In theory, there’s still choice. In practice, language testing operates as a cartel with tremendous pricing power. For their own convenience, governments typically pick just a few companies to run tests for immigration, so exam takers can’t shop around as they would for other goods and services.”

Sure, there may be a cartel, but stiff competition has eroded the profitability of individual testing firms in recent years:

“IDP would be a fantastic business were it not for one major weakness in its business model — its gatekeeper status isn’t earned, it’s ordained. Governments decide who its language gatekeepers will be, and they can take that privilege away in a heartbeat, or dilute its value by offering other companies the same deal.”

This is what I’ve been saying here for most of the past year.  Competition has finally arrived.  More competition is en route.  The old monopolies are dead or dying.  A lot of individuals whose livelihoods are affected by the ebb and flow of the IELTS monopoly might pile in to object, but it’s true.

Regarding Canada in particular, Witcomb notes:

“The new testing options will erode IDP’s market share. If the company’s SDS share slips from 100% to 70%, it would mean 80,000-110,000 fewer tests; at $300 per test, a 2-4% drop in total revenue would be the result and a slightly higher fall in net profit due to fixed costs. But with four new competitors, market share losses over the long term could be much higher than we’ve assumed here. We wouldn’t be surprised if IDP’s market share eventually settles below 50%.”

Witcomb astutely points out that lowered language requirements for Canada will also reduce the number of repeaters in the years ahead.

Despite all of this, Witcomb seems more bullish on IDP’s prospects than I am.  He suggests that cartel-like pricing will keep profits high despite market share losses.  He may be correct. But as I have noted here before, DET is coming, and they aren’t going to charge $300 per test.

It is only a matter of time.

Witcomb doesn’t touch on it, but as I have noted here before IDP’s long-term viability is somewhat dependent on its ability to create a “next-gen” IELTS which can compete with DET. The three-headed nature of the IELTS program may complicate that.