• Sustainability at the National Level• New DOE Grant Goals• Sustainability Model• Critical Levers

• Sustainability at the Local Level• Critical Levers• Scenario Planning• Sustainability Model for Stations

• US DOE grant was awarded in August 2005

• PBS committed to annual enrollment and revenue targets in order to reach sustainability

• PBS developed a comprehensive financial model to assess progress • Model forecasts inflows and costs • Quarterly update and progress review

• Eduventures advises PBS TeacherLine on:• Financial performance• Progress towards sustainability• New product pricing models

New DOE Grant Goals

• PBS National is committed to system-wide sustainability

• Enrollment and revenue goals were set to measure progress• 20% increments over five years • Local stations are critical

• Both PBS and local stations have influence • National has indirect influence on increasing distribution and direct

influence on controlling costs• Local stations have direct influence on increasing distribution and

indirect influence on controlling costs

Sustainability Model

Enrollment Goals

41,116

37,390

24,307

16,396

9,807

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

GY01 GY02 GY03 GY04 GY05

Projected Enrollment

Note: GY01 is the first year of the new grant, 2005. GY05 = 2009-10.

Includes both national and local enrollments.

41,116

37,390

24,307

16,396

9,807

9,690

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

GY01 GY02 GY03 GY04 GY05

Projected Enrollment Actual Enrollment

Grant Year 1 Enrollments: Actual vs. Goal

Actual program enrollments

Revenue Goals

$6,905,581$6,354,181

$3,346,749

$1,865,431

$909,614

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

$8,000,000

GY01 GY02 GY03 GY04 GY05

Projected Program Revenue

$543,103

$6,905,581

$6,354,181

$3,346,749

$1,865,431

$909,614

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

$8,000,000

GY01 GY02 GY03 GY04 GY05

Projected Program Sales Actual Program Sales

Grant Year 1 Revenue: Actual vs. Goal

Actual program revenue

Calculating Sustainability

* Excluded: Program Grant Funding, Program Evaluation and Program Product Development Costs

Program Generated Revenue 543,103Expenses 2,349,315

 Operational Sustainability * 23%

Enrollment Summary   Local 5,973 62% National 3,717 38%Total 9,690

Focus On Levers that Affect Program Revenue and Efficiencies

Lever Effect How to Move It

Total EnrollmentIncreased total enrollment contributes directly to program revenue

Enroll new learners, encourage repeat learners

Course FeeOptimal pricing contributes directly to program revenue

Minimize discounting to capture maximum value without losing learners

CostsReducing costs increases revenue contribution

Look for efficiencies

Course Size

Increasing the average enrollment per course leads to more efficient (and more profitable) courses

Effectively predicting course demand; migrate learners to alternate / national courses when not profitable to run

Pro

gra

m

Dis

trib

uti

on

Pro

gra

m

Eff

icie

ncy

Program Efficiency: Cost per Learner

Facilitator 62.6

Customer Support 8

Hosting 25

eCommerce 6

Revenue Share 80

Total $181

Revenue Contribution $18

Excludes Overhead costs

• Sustainability at the National Level• New DOE Grant Goals• Sustainability Model• Critical Levers

• Sustainability at the Local Level• Critical Levers• Scenario Planning• Sustainability Model for Stations

Stations Have Direct Influence on Program Distribution

• Stations have the ability to considerably impact TeacherLine program distribution and efficiency

• The main levers for distribution are:• Lever 1: Course fees• Lever 2: Total enrollments

• Program efficiency is driven primarily by:• Lever 3: Average course size

Lever 1: Raising Course Fees 10%

Scenario 1:

10% Course Fee Increase

Projected Course Fees (Local)

$156

Average Enrollment (Local)

187

Projected Revenue $29,172

Summer 2006 Actuals

Average Course Fees (Local)

$142

Average Enrollment (Local)

187

Average Revenue $26,554

Difference: $2,618

Note: Summer 2006 Actuals represent the average station course fee and enrollment in Summer 2006

Lever 2: Raising Enrollment 10%

Summer 2006 Actuals

Average Course Fees (Local)

$142

Average Enrollment (Local)

187

Average Revenue $26,554

Scenario 2:

10% Enrollment Increase

Average Course Fees (Local)

$142

Projected Enrollment (Local)

205

Projected Revenue $29,110

Difference: $2,556

Average Course Size*

13 15 17

Course Costs** $1,885 $1,975 $2,065

Costs per Learner

$145 $132 $121

* Average Course Size was calculated for locally provided courses. Spring 2006 local courses averaged 17 learners per class and Summer 2006 averaged 13 learners per class.

**Course Costs include Facilitator, Course Licensing Fee, Per Seat Fee and eCommerce Fee

Lever 3: Increasing Class Size

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000

$4,000,000

$4,500,000

GY01 GY02 GY03 GY04 GY05

Projected Program Costs Projected Program Revenue

PBS National Sustainability Progress

Local Sustainability Model

• PBS is proposing to develop a template to help stations assess progress

• The template will be based off the national model and will include:• Revenue projections • Operating costs• Course size breakeven chart• Progress towards sustainability

• Similar to national model, it will not include:• Overhead Fees (personnel, any in-kind)• Local Innovation Funds

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