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.

Pearson’s 2024 Q1 trading update is now available. Of the PTE, it says:

“Pearson Test of English declined slightly due to a strong comparator, and we expect performance will ramp through the year.”

We’ll see. I’m bullish on PTE’s potential, but we are now in the brave new world of reduced admissions in Canada, the UK and Australia. One imagines that fewer people will take English tests in general.

Q1 results from Duolingo will be published in a few days. Perhaps they will provide more clues as to what lies ahead.

I posted the following on LinkedIn last week, and IELTS tutors piled in to my page to insist that it will never happen, and that people are proud to take the IELTS instead of some other test.  Look, I could be wrong.  But I must note that no TOEFL tutors came to say that.  TOEFL tutors already know what the Duolingo English Test has done to their business model.  And the smart TOEFL tutors are planning for when the NABP starts accepting the Duolingo Test.

A final observation re: market share.

In the relatively near future, the Duolingo English Test will likely be accepted by governments around the world for visas and study permits.  This change won’t happen in 2024 or 2025, but it will probably happen within the next five years. Certainly within the next decade. When this occurs, demand for the IELTS, PTE-A and TOEFL tests will decline precipitously.

Few people will opt for a $250 test when a $65 test is accepted by the same authorities and is just as respected (or more respected) by the universities they wish to apply to.

As I indicated earlier, I assume that work on the next-gen IELTS and TOEFL tests is already underway.  If it isn’t… now is the time to break the glass and get started on tests that can compete.  Remember that it takes quite a long time to develop a test – the DET was in development for more than six years before it went mainstream in 2020, and the TOEFL iBT was developed over about twelve years before it launched in 2005.

Now in open access from “Language Testing” is an excellent article about test score comparison tables by Ute Knoch and Jason Fan. It explores the concordance tables provided by the makers of the TOEFL, IELTS, PTE-A and C1 tests.

This is a wonderful area to explore in 2024 – most readers are probably aware that the topic of concordance tables has come up quite a lot in recent years as the English test market has become more competitive.

The article suggests that when it comes to creating score comparison tables, best practice principles are not always fulfilled. It notes:

“Our findings indicate that the information provided on the test provider websites about concordance tables is often vague or insufficient. Test users are not always provided with the research underpinning these concordance tables. When such research is provided, it tends not to fulfill the good practice principles and is usually presented in formats not easily accessible to non-specialist test users.”

And also:

“…the sample sizes are generally too small to provide robust score comparisons. Basic information is often not provided, such as concordance results for subsection scores (which are crucial for the requirements for Australian migration and other policy-makers), the number of observations at different score levels, and their standard errors. Test users are not usually informed about the potential limitations of using published concordance tables.”

But why? Well…

“At the moment, there is little motivation to invest in more robust concordance studies due to the absence of regulatory oversight and minimal demand for high-quality work from test users. It is also important to note that concordance tables are one site in which competition between test providers manifests, who may have a commercial interest in lowering their test scores to make it easier for applicants to achieve certain test score requirements.”

There is much more in the article. Do check it out.

Now in preprint from Daniel Isbell and Nicholas Coney is an article examining how English Language Proficiency tests are used at 146 research-intensive universities in the USA.  It examines which tests are used for admissions, what cut scores are used (and they compare across tests), and how subscores are used in admissions decisions.

The authors learned that the TOEFL iBT, IELTS, Duolingo, and PTE-A tests are most widely accepted, and in that order.

A few fun bits:

  • The TOEFL iBT is accepted for unconditional undergraduate admission at 135 schools, the IELTS at 133 schools, the Duolingo at 110 schools and the PTE-A at 61 schools.  I suppose this will be a priority of the folks at Pearson in the years ahead.  Though the test has (I think) moved into the #2 spot worldwide in terms of test taker volume, they still have plenty of room for growth in this area.
  • For unconditional graduate general admissions, the numbers are a bit different. The TOEFL is accepted at 117 schools, the IELTS at 116, the DET at 62, and the PTE-A at 54.  Obviously both the Pearson and Duo folks may wish to prioritize this area.
  • I was very pleased to see that the TOEFL CBT, which ceased to exist in 2006 is still accepted for unconditional admission to 11 undergraduate programs and 10 graduate general programs.  The TOEFL PBT, which was discontinued in 2017, is even more popular.  I suppose ETS ought to prioritize communications with score users in the years ahead.
  • As I have noted in my “score requirement tracker” posts, Duolingo cut scores have not always kept pace with revisions to their score concordance tables.

That’s just the tip of the iceberg. There is some really wonderful data here, so do check it out.

Note, of course, that the above figures may have changed since the time the data was gathered.

How closely should an English Test result reflect a test taker’s ability if they go into the test mostly blind?

If we know that the test taker is at a C1 level, is it proper to expect them to get an equivalent test score (95 on the TOEFL iBT, 7-8 on the IELTS, 76-84 on the PTE Academic, etc) if they take the test with only a cursory amount of preparation? Or is that expectation inappropriate?

I think this is probably too much to ask for, but how close should the theoretical test taker’s result be to their actual fluency in the language?

A wise test watcher recently noted that students pick their tests based on “perceived easiness.” I think that part of “perceived easiness” is the perception that the test result will reflect their actual English ability even if they don’t spend hundreds (thousands?) of dollars on test prep products.

Perhaps this accounts for the skyrocketing popularity of certain tests in recent years. Perhaps test takers feel those tests provide a better opportunity to certify their English language skills without investing too much in supplementary products.

Thoughts?

You know, if I were a wealthy man I would pay for my mother to take every English test with a CEFR concordance available. I’d see which results more closely match the fact that she’s a C2 user of the English language. I guess it doesn’t have to be my mom taking the tests, but she does seem to have a lot of time on her hands nowadays.

Pearson published its 2023 full year results a few moments ago.  They indicate that the PTE test was taken about 1.231 million times in 2023.  That’s an increase of 49% from 2022, when it was taken about 827 thousand times. 

Clearly, the folks at Pearson are doing something right.

I think this means the PTE is now the second most popular test of its type, behind the IELTS and ahead of the TOEFL.  I could be wrong, though, as TOEFL test volumes aren’t reported publicly. Just note that ETS head Amit Sevak has indicated a few times that the TOEFL is taken about a million times a year.

Once the British Council has released its 2023 annual report I’ll post estimated volumes of the four big English tests (and if anyone from a smaller firm can point me to stats for their own tests I’ll be happy to mention them as well).

The PTE Core test is now open for booking. Tests begin February 12. This new test, from Pearson, is accepted by the Government of Canada for all work and migration visas.

So ends the last IELTS monopoly. I’m a big fan of the IELTS, of course, but I realize that consumers benefit a lot when they have a greater range of tests to choose from.

I’ll try to take the test myself in the very near future. As I’ve written here a few times, what makes the Pearson suite of tests attractive to me is the contemporary and modern test-taker experience they provide from the beginning of the registration process right through to the sending of scores to recipients. Indeed, if you check out the recent quarterly report from Pearson, you will learn that their test volume is skyrocketing. While their competitors are making great strides in those regards they haven’t quite been able to keep up. 

Check the website for info re: test format, prep materials and scoring.

The cost of taking the PTE Test increased in a bunch of countries this week. At first glance, it seems like all of the price increases are in Asia-Pacific countries (though I could be wrong). Here’s a list of increases in countries I’m most interested in:

  • Australia: $410 AUD → $445 AUD
  • China: $310 USD → $317 USD
  • Hong Kong: $295 USD → $303 USD
  • Lao: $180 USD → $185 USD
  • New Zealand: $410 NZD → $445 NZD
  • Philippines: $220 USD → $230 USD
  • Singapore: $270 USD → $300 USD
  • Taiwan: $240 USD → $260 USD
  • Thailand: $200 USD → $205 USD
  • Vietnam: $180 USD → $185 USD

Source.

UpdatePearson has now raised the cost of taking the PTE in countries around the world.  Earlier I noted here that prices only went up in Asia-Pacific nations.  Here are the increases in a handful of countries that interest me:

  • Canada: $330 CAD → $340 CAD
  • India: ₹15900 → ₹17000
  • Pakistan: $215 → $220
  • South Africa: 4300 ZAR → 4600 ZAR
  • Brazil: $225 USD → $230 USD
  • Germany: $250 → $260
  • Saudi Arabia: $340 USD → $350 USD
  • Switzerland: $300 USD → $330 USD
  • United Kingdom: 190 GBP → 200 GBP
  • USA: $235 USD → $245 USD

Stay tuned for TOEFL price hikes, which usually occur around the end of January.

Worth mentioning here that Pearson’s website now indicates that the PTE Core Test “will be available to book in early 2024” (previously: late 2023). Says Pearson: “[the test is] for people who wish to work, migrate, or seek permanent residency in Canada, and will be recognized by the Canadian Government (IRCC) for all economic visa categories.”

In many (all?) of the above categories only IELTS and CELPIP scores are currently accepted, so the introduction of a new test is a consumer-friendly development. The IELTS and CELPIP tests are also 3+ hour tests which can be pricey. I predict that the Pearson test will be shorter and cheaper. But we’ll see.

I’ve been writing about this test since February of 2023, and am looking forward to seeing some concrete details.  Note that this was formerly called the PTE Essential Test.

As promised, here are the prices for English tests in China:

  • IELTS: 2170 RMB ($303 USD)
  • TOEFL: 2100 RMB ($294 USD)
  • PTE: $310 USD

A few things are worth noting:

  1. Per Chinese law, the IELTS and TOEFL tests are administered in China via partnerships between their owners and China’s National Education Examinations Authority (NEEA). This inserts an extra level of bureaucracy into the whole process. This means that test-takers register for the tests via the NEEA website, get their scores via the same website, and pay the test fee directly to the NEEA. Test-takers are subject to the NEEA’s privacy policies. Moreover, at-home testing in China requires a clunky workaround. The NEEA also keeps some (a lot?) of the test fees, but I guess that’s the cost of doing business in China.

  2. Many people view this partnership as the reason test fees are so high in China. As you can see, the cost of taking a TOEFL or IELTS test in China is way above the worldwide average (which is close to $230 USD). On the flip side, fees are set in RMB, so Chinese test-takers are protected against the slow and steady rise in value of the USD. When I started tracking prices a few years ago China was the most expensive place in the world to take the TOEFL. I think it is the ninth most expensive now.

  3. It seems like Pearson administers its tests on its own. I’ve always wondered how that is possible. The NEEA handles the whole registration process for all the major tests in China – the TOEFL, the IELTS, the GRE, the GMAT, the LSAT. Even the CAEL. Am I missing something here?

  4. Students looking for a good deal in China might try the CAEL, which is fixed at 1920 RMB (267 USD).