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3. Total Cost of Ownership

Informal Learning Environments Total Cost of Ownership by Kenneth Buis



The Total Cost of Ownership is described as the lifetime costs of acquiring, operating, and changing something. TCO analysis often shows there can be a large difference between the price of something and its long term cost. This cost analysis is easier for formal learning, since in those environments, there are prescribed costs connected to particular learning outcomes. However since informal learning takes place generally outside a dedicated learning environment and has the characteristics of spontaneity, collaboration, experiential situations, creativity and the extension of affective, cognitive and social realms, it is much more difficult to measure.

Formal training does not provide people with the skills, experience and knowledge to be successful in our rapidly changing world. In order to keep up with the daily innovations in our global network society, businesses and educational facilities must change budgets and shift resources into the informal settings where learning actually takes place. In order to facilitate informal learning in a cost-effective manner, the creation of a [1] Community of Practice using existing structures that provide services for social, knowledge exploration, knowledge interaction, and knowledge creation. This can include a combination of any of the following applications built into a Personal Learning Environment:

  • YouTube
  • Blogs
  • Twitter
  • Social Networking Sites
  • Online Collaboration Services
  • Professional Networking Sites: LinkedIn, Ecademy
  • Online free tutorial sites - psdtuts
  • Online Project collaboration Spaces
  • Wiki Spaces
  • Free online education services for personal interest: Ted Talks, MIT opensource courses, Apple University

In order to keep costs of training and learning down, many corporations and educational facilities are utilizing the collective intelligence of their employees or learners by providing them with personal learning portals, or social network capabilities that enable group consultation and knowledge sharing in ways that are more context specific than formal learning can provide. In a collective digital environment of services and web applications, it is possible to create environments that allow effective informal learning.


This lowers the Total cost of ownership for an organization, but what are the real costs of moving towards informal learning environments? Even if free services are implemented, for example using social networks in existing frameworks, like Facebook, or creating ones from Open Source software such as Elgg, there are costs involved that need to be offset by some method. These offset costs, which may include the sale of personal information to advertising agencies, loss of productivity or data mining of a staff computer must be included in the total cost of ownership of Informal Learning.

Factors to Consider in Informal Learning Environment TCO

  • Research into Personal Learning Environments that support Informal Learning: Building in appropriate applications and finding environments that support informal learning
  • Training/Support for facilitators, learners and users of the Personal Learning Environment
  • Device Costs: Newtorking, Hardware, Software, Data Centres required
  • Formal Training redesign: A redesign is required to move emphasis from formal training to informal training through digital spaces
  • Energy use
  • Loss of Privacy
  • Lost Productivity

Total Cost of Ownership for Personal Learning Environments

While integrating free tools and applications into personal learning environments are free for the institution that uses them, there are many hidden costs that must be integrated into the total cost of ownership.

Research Time: Applications and Environments that Support Informal Learning

In order to build an excellent Personal Learning Environment, time must be taken to research which applications can be interconnected to encourage interaction, knowledge creation and task-oriented problem solving. Since applications such as Facebook, Blogs, or Google Apps are in a fluid state of change, their suitability to the learning needs of the individual or community of practice


For many organizations, setting up an informal learning environment can be hindered by technology. With a wide range of applications, online services, and functionality, institutions often set up Communities of Practice to afford Personal Learning Environments, yet discover that in order to suit the needs of the company or classroom there is a significant amount of customization required. In an effort to cut costs, or build a learning portal, many organizations can find themselves building on existing infrastructure rather than utilizing new tools that may be more applicable.

Training/Support for facilitators, learners and users of the Personal Learning Environment

Training for implementing personal learning networks into educational or business environments can be expensive. Network support staff need to ensure that all elements and applications of the PLE are openly available to users and that there is sufficient knowledge and trouble shooting abilities in tech support staff. Facilitators and learners need training time to learn how to use the environment effectively . Costs that need to be built into the adaption of the various tools include:

  • the training for the initial setup
  • site branding, customization
  • content (independent or crowd sourced)
  • authentication procedures for the IT team
  • integration of tools into a learning portal.

While there is no definite costs for training each division/individual to learn to build and adapt the Personal Learning Environment for informal learning purposes, the costs can be broken down into costs per learner, as seen in the LMS cost comparison chart below:

Comparisons of LMS Systems

Device Costs: Newtorking, Hardware, Software, Data Centres required

The costs of setting up networking infrastructure for running the applications that are part of Personal Learning Networks are not directly felt by the user. However, the costs of running data centers are enormous. This must be built into the total cost of ownership, since providers need to be able to generate enough income to pay for the services they provide.

Google expenses.jpg

For schools and institutions there is the cost of access to the PLE, whether that is by mobile, notebook or computer, as well as server infrastructure and networking costs which will vary according to numbers of users and bandwidth requirements.

Formal Training redesign

Integrating informal learning into institutions that previously relied solely on formal training will require training and several months of work hours to recreate content that encourages employee or student interaction, along with building in situations that encourage informal learning.

Energy use


While companies like facebook are very secretive about their energy use, it is important to work in the costs carried by PLE service providers as well as the energy use costs of users of the Personal Learning Environments. The Sunday Times reported that there are more than 200m internet searches around the world each day. This is a concern, since it has also been reported that the IT industry generated as much greenhouse gas as the world's airlines. Data centres which store millions of websites and host applications for learning environments take an incredible amount of energy, and that amounts to an environmental concern. The article in the Times went on to state that 2 searches on Google was similar in energy use to boiling a kettle. Depending on the search, or the activity online, the environmental cost of informal learning becomes greater.

Loss of Privacy

The loss of privacy in the creation of personal learning networks needs to be factored into the Informal Learn TCO. Companies like Facebook have unrestricted access to everything its users do on its site, along with its profile data, networks of friends, and surfing habits. Google Chrome automatically suggests links whenever you type anything in the address bar, suggesting that it is collecting data every time you search for anything. The value of private information is incredible. Sharespost, a marketplace for shares in privately owned companies, reported that Facebook was worth $11.5 billion, Twitter was worth $1.4 billion and LinkedIn was worth $1.3 billion.

When building a social network into a personal learning environment, thus enhancing informal learning, can result in the loss of privacy. This is perhaps the greatest cost.

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Lost Productivity

There is a further cost of loss of productivity that should be included in the total cost of ownership. As seen in the video below, informal learning through social networking or personal learning networks can become a distraction and cause a loss of productivity.


Who covers the costs?

The costs borne by institutions using free applications, or social networking and blogging services are variable and dependent on the size of the institution and/or numbers of users. For the providers of the "free" services, they rely heavily on venture capital, advertising revenues gained by selling personal information and investment by other big tech companies. Microsoft, for instance, invested hundreds of millions of dollars in Facebook in 2007, to allow it to purchase more data centres and expand its services.


When evaluating the usefulness of incorporating informal learning environments into an educational or corporate structure, through the use of personal learning networks, it is important to weigh the costs of formal training against that of informal training. While formal training does play a significant role in education and employee training, context-specific learning through interacting in various digital learning environments may allow more efficient training, learning and social or team-building opportunities at a much lower cost to the institution, despite the potential loss of user privacy. However, it is important to review all the costs associated with setting up a PLE, including time, infrastructure, training and more. Yet, when the digital informal learning environment is combined with the physical space, such as an art gallery, the combination is very powerful for the creation and interaction with knowledge.

Report Card Rating


Successful implementation of Informal Learning Environments require a significant amount of time for set up, training and customization. They are expensive on the side of providers due to energy costs and physical infrastructure, and to the user through privacy and productivity losses, however the amount of potential learning provided in informal learning spaces is enormous. When compared to formal learning costs, informal learning is far cheaper and can be more effective for reinforcement of concepts and ideas.

Informal Learning - Total Cost of Ownership: B


Arrington, Michael (2008). Facebook May Be Growing Too Fast. And Hitting The Capital Markets Again. Tech Crunch. <> (accessed July 11, 2010).

Leake, Jonathan and Richard Woods. (2009). Revealed: the environmental impact of Google searches. <> (accessed July 9, 1020).

MacMillan, Douglas. (2009). Facebook Connect: Your 8,000 Hidden Friends. BusinessWeek Online, 4/2/2009, p3-3, 1p. < 649562.htm> (accessed July 10, 2010).

Miller, Rich. (2010) Google Data Centre Spending Slightly Up, <> (accessed July 11, 2010).

Nosko,Amanda, Eileen Wood, Seija Molema. (2010). All about me: Disclosure in online social networking profiles: The case of FACEBOOK. Computers in Human Behavior 26 (2010) 406–418.


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