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Earlier this year, two salespeople drove deep into the coal country of southern West Virginia on an improbable mission: selling expensive education software in one of the poorest corners of America. Logan County does not look like promising sales territory. Its mines have laid off thousands, methamphetamine labs abound, and every spring flooding creeks threaten impoverished hollows. Its population has dropped 35 percent in the past four decades.
But for Ron Dellinger and Samiha Lamerson, the two salespeople from Plato Learning Inc., the region's despair was not an obstacle. Far from it. For companies selling education software, the poorer a place is, the better.
The reason is simple, Dellinger said: Poor schools "are under the gun from No Child Left Behind."
No Child Left Behind, President Bush's signature domestic policy achievement, is transforming public education with its emphasis on testing and accountability. Less noticed, though, is that it is turning poor schools into a lucrative target for the growing education software industry -- with potentially negative implications for the very low-income students that the law aims to help.
Billions of dollars in federal funds are up for grabs as companies rush to capitalize on the 2001 law by telling struggling schools across the country they can comply with its tough standards by buying the companies' products. In pitches often sweetened with dinner cruises and other perks, software vendors make sweeping claims for computer programs and on-line networks that promise to assess students' weaknesses, raise test scores, and organize the data required by the law. "We're filling the needs of schools to help them 24-7, to supply what students need," Lamerson told school officials gathered at an alternative vocationalhigh school tucked between fog-draped hills along Logan's Guyandotte River. However, software claims of success tend to be based on dubious studies, often performed or paid for by the companies themselves -- a problem that is acknowledged even by the Bush administration. While encouraging schools to use education technology to comply with No Child Left Behind, the administration is paying for millions of dollars in studies to determine which education software programs really work.
"We're spending all this money on technology in schools and we don't know where it's effective, what the conditions are for effective teaching and learning," said Susan D. Patrick, the U.S. Department of Education's director of education technology.
Desperate not to run afoul of the law and suffer sanctions, including state takeover, many besieged educators are succumbing to the pitch anyway, buying instructional programs that often cost more than $100,000 per school or district-wide management programs that run into the millions. And by spending much of the law's funding on software, they are leaving less for such improvements as smaller class sizes, after-school programs or bonuses for talented teachers.
The new digital divide
Meanwhile, many experts in education technology worry that the push to sell test-preparation software to poor schools could deepen exactly those inequities that the law is meant to address. The law, they say, is creating a new "digital divide" just as low-income districts are finally catching up in their access to computers: While poor schools tend to buy software with repetitive math and reading exercises that produce few lasting gains, wealthier ones are using technology in ways that contribute more to in-depth learning.
The divide is on display in Maryland, where struggling schools in Prince George's County and on the Eastern Shore are spending heavily on software to try to raise test scores, while better-off schools in such places as Howard County are relying on teachers for instruction in fundamentals.
In Baltimore, schools are being bombarded with pitches. But for now they're holding out, restrained by budget deficits and by memories of wasted spending on education software in previous decades.
To some educators, the rush by software vendors to take advantage of No Child Left Behind points to one of the law's biggest flaws. While the federal government is setting tougher standards than ever before, Washington remains reluctant to dictate how districts should spend funding provided by the law to meet its requirements.
Research results not ready
The law's pressures encourage districts to buy software to raise their scores, but the government's research on instructional software won't be done for two years. The government is spending millions developing a Web site and computer program that could help districts analyze test data, but it is not requiring that districts make use of these rather than buy their own. This conflicted approach, mixing stringent standards with little guidance, sows confusion among local school officials and creates openings for vendors.
"The whole gist of [the law] is to attempt to impose some kind of national consistency, which is a good thing in the long run, but some [districts] aren't seeing it that way now," said Craig Cunningham, a research associate at the University of Chicago's Center for School Improvement.
Education software executives dismiss concerns about the value of their products, saying their programs can help struggling schools improve their performance on annual tests and set failing students on the path to success.
"We can look with pride at teachers who get teary-eyed when they talk about what it does for their students," said John Murray, CEO of Plato Learning, which is based in Bloomington, Minn. Everywhere he goes, he said, "there are people talking to me about the way our systems help them turn kids into good, productive citizens."
Some experts also defend the value of software spending by struggling districts. The programs can be a good option for schools that can't afford other improvements, such as hiring more teachers to reduce class size, they say.
"There are big efficiencies in augmenting what teachers are doing [by buying] technology," said Dale Mann, a Long Island-based education researcher who has studied software's effects for companies.
While software vendors reject characterizations of their instructional products as simplistic test-prep material, they concede that they are focusing their marketing on schools that are desperate to raise students' scores.
"That's where the pain is. You go where the pain is, and you talk to the pain," said Catherine Pena, a saleswoman for the software company Curriculum Advantage, during this year's national education technology convention in New Orleans.
Administrators at failing schools "do not have a choice with No Child Left Behind," she said. "They have to do something. That's why we're here - to help them."
John Kernan, a member of Plato's board of directors, spelled out his strategy in blunter terms in a quarterly conference call with analysts last year. Kernan, then CEO of the Lightspan software company, which merged with Plato last November, told analysts that No Child Left Behind's emphasis on failing schools promised big earnings for any company focused on selling to low-income districts.
"School districts are required to spend their money on the poor kids," Kernan said, according to a transcript of the call. That meant, he said, that his company's "strategy No. 1" for higher profits was: "Lightspan equals poor kids equals federal money."
Millions at stake
The potential payoff for the industry is huge. Under the law, the federal government, which funds about a third of all school spending on computers and software, sets aside $700 million per year for education technology, most of it for poor districts. But companies are even more eager to tap into a much larger pot of money, the law's general federal funding for needy students.
While it is not as much as Bush's critics say was promised, this general funding for low-income students has increased by nearly half under the law, to almost $25 billion. Partly to encourage schools to use education technology, the law also gives districts more flexibility in how they can spend the money, making it easier for software companies to make a bid for it.
The federal government says it is unable to track how much general No Child Left Behind funding is being spent on technology. But industry leaders and market analysts put the annual total at more than $1.5 billion and say total school spending on education software, from all sources, is up nearly 10 percent this year to about $2.3 billion - despite budget cuts at the local level.
Software spending is expected to grow at an even faster rate as more of the money makes its way through the bureaucracy, as state and local budgets rebound, and as more of the law's mandates kick in, making schools even more anxious for answers.
"It's a big opportunity for us," said Murray, whose company has seen its sales increase 10 percent in each of the past two years, to about $150 million. "No Child Left Behind ultimately is a good fit for Plato and other education technology companies."
The law also means new business for other sectors of the education industry. Test-writing companies have won big contracts to create statewide exams. The multibillion-dollar textbook industry is counting on the law's new curriculum guidelines to boost sales.
And the law's requirement that failing schools offer private after-school tutoring has created opportunities for companies such as Baltimore-based Sylvan Learning, which are rushing to get on states' lists of approved tutoring providers. The tutoring market is expected to grow to more than $1 billion.
But no sector has generated as much ambivalence among educators as the education software industry. Most educators agree that tutoring programs, if done right, could be helpful. There is less consensus about the value of software spending - and much more discomfort about software companies' aggressive pursuit of school funds.
Invoking the law
Zeroing in on individual school districts, schools and even teachers, software vendors link their products explicitly to the pressures of No Child Left Behind, which passed with bipartisan support late in 2001.
The law requires that schools test students annually in grades three through eight, and once during high school, and make "adequate yearly progress" toward having all students proficient in reading and math by the 2013-2014 school year. Notably, school-wide scores must be broken down into each of several groups - including minorities, English as a second language learners, and special education students - and show progress in each.
Struggling schools initially receive extra federal funding. But if they continue to fail, they must pay for private tutoring and allow students to transfer, cutting funding allotted to their old school. The worst performers face sanctions including staff overhauls or state takeover.
For software vendors, the law creates demand on two fronts: for classroom products that promise to assess students' weaknesses and prepare them for tests with math and reading drills, and for expensive data-management programs that can track the reams of test data and student information that must be reported.
Many districts already have data systems in place, but salesmen are persuading them that those need to be overhauled for No Child Left Behind. While recognizing that some districts do need to keep closer track of student data, education technology experts worry that the huge purchases - often for more than $10 million - are diverting money from classrooms.
"Millions [of federal dollars] are being poured into some districts, but they have to spend the majority to enhance systems to record data," said Jan Van Dam, board president of the International Society of Technology in Education, which promotes the effective use of technology in schools. "The sad part is that you're not going to accomplish what you really want to, to improve achievement for children."
'They're making a killing'
Karlene Lee, technology director for the Las Vegas schools, put it more sharply: "No Child Left Behind is a boon for" companies selling student data software, she said. "They're making a killing."
The attempts to capitalize on the law are not subtle: McGraw-Hill, a textbook publishing giant that has expanded into software, is marketing a new program called "Yearly Progress Pro" - its name taken straight from the law.
Often, software vendors come bearing gifts, free product samples to pique districts' curiosity and win their gratitude. LeapFrog SchoolHouse, in a partnership with Wal-Mart, announced last year that it was providing its $20,000 assessment software packages for elementary school students free of charge to 50 districts.
And two years ago, Plato formed a partnership with the National Association of Black School Educators, headed at the time by Andre J. Hornsby, now the CEO of Prince George's public schools. The company pledged $3 million in matching grants for urban schools that bought Plato products.
The selling goes on wherever there are struggling schools with federal money to spend:
In South Florida's Broward County, the fifth-largest school district in the country, officials have been so deluged with advances by software firms that they have set aside one day each month for sales presentations. The waiting list is so long that vendors are now being scheduled for April.
Pearson Digital Learning, the country's largest education software company, sends an "eBus" equipped with 13 computers and an Internet satellite connection to demonstrate its products at urban schools. Its itinerary has included Washington, Newark, N.J., and Bushwick, a poor neighborhood in Brooklyn, N.Y.
In Las Vegas, officials of the country's sixth-largest school district say that vendors have been most aggressive in marketing to the state's failing schools, on the assumption that they will be receiving more money to help them improve.
Similarly, in Maryland, the pressure is by far the heaviest in the two districts with the largest numbers of poorer students and failing schools, Prince George's and Baltimore City.
Prince George's has responded, spending millions of dollars on various programs in the past few years despite budget problems that forced it to cut in other areas. The $3.9 million deal it signed last year with the Grow Network for a new "instruction management" program to analyze student test scores costs about as much as the county's mandatory summer school, which was replaced with a voluntary program last year for lack of money. It's also roughly equal to the cost of hiring 75 teachers to reduce fourth-grade class size from 31 to 25, which was delayed for a year due to budget constraints.
Baltimore administrators have mostly held back from major purchases, figuring the financially strapped system can't afford costly software at the moment. But that hasn't stopped vendors from trying to win them over.
"I'm inundated. We get a lot of stuff," said Mary Yakimowski, Baltimore's chief of educational accountability. "And of course everything is 'in line with No Child Left Behind.'"
The face is familiar
Often, software vendors help their cause by hiring as their salespeople former teachers and school administrators. When Ron Dellinger showed up at Logan's Ralph Willis Vocational Center in his Mitsubishi Galant for a monthly meeting of administrators from the state's southwestern region, he was 360 miles away from his base in Martinsburg at the other end of the state.
But many at the meeting knew him: Before joining Plato three years ago, he was a county school superintendent and director of one of the state's eight education districts.
Just the weekend before the Logan meeting, Dellinger had visited the racetrack in Charles Town, W.Va., with Rick Powell, the director of the southwestern school region, who was presiding over the meeting. Powell opened the meeting by joking about the trip to Charles Town and telling the dozen assembled administrators that "Ron needs no introduction, being a former superintendent."
Dellinger, dressed in a crisp navy blue suit, assured his audience that he was "an educator, not a salesman." He introduced his Plato partner, Lamerson, a curriculum consultant based near Frederick, Md., who proceeded to give a 20-minute exhibition of Plato software on a computer hooked up to a projector.
Clicking through Plato's offerings, Lamerson said the company had a solution for nearly every requirement of No Child Left Behind. Its software could assess students every few weeks so officials could track their readiness for the annual test and assign drills to attack weaknesses. It could organize the school's data by the demographic groups identified in the law. Its Focus program was "developed specifically" for the law's Reading First portion.
The audience needed little reminding about the pressures of the law. Several counties in the southwestern region have schools that are under warning status for failing to meet goals.
"Everyone wants to meet the requirements, and they'll do everything they can to meet them," said Sammy Dalton, principal of a Logan County elementary school.
The salespeople, meanwhile, knew full well which districts were most likely to look to Plato for answers. Dellinger said in an interview that one Plato division tracks federal grant awards to schools and sends him a weekly update. "If we see they get funding, we'll revisit them with a phone call," he said.
When Lamerson's presentation was done, school officials oined the salespeople for a prime rib luncheon prepared by a school secretary and her niece. Dellinger reminded the administrators that he had laid out product brochures for them.
"But don't feel obligated," he said.
Even as they send salespeople from school to school, companies relish the chance to pitch products at education technology conventions to thousands of educators at a time.
Conferences are held annually in most states, but the industry's mecca is the National Education Computing Conference. This year, a record 17,500 teachers, school administrators and vendors attended the four-day event in June at the New Orleans convention center, where 450 companies showed off their wares in a 120,000-square-foot exhibition hall.
By day, educators thronged the hall, where the biggest companies competed to have the tallest banners, like car dealerships. They sat in canvas chairs as salesmen wearing microphone headsets demonstrated software on enormous projection screens. At the end of the sessions, audience members were rewarded with lottery drawings for free software and electronic toys.
Company salespeople and executives on the floor said they were seeing even greater interest from educators than in previous years, thanks to the demands - and additional funding - of No Child Left Behind.
"Everyone's out there looking for the magic bullet," said Laura Hunt, a saleswoman with Riverdeep, an Ireland-based company that outdid its rivals by setting up black leather couches.
Nearby, Kirk Gibbs, a salesman with Pearson Digital Learning, was also upbeat. "There's considerably more money available," he said. "With high-stakes tests, a lot of administrators are under pressure to make things happen."
By night, vendors entertained educators at open-bar parties in hotel ballrooms and packed chartered riverboats for two-hour spins down the Mississippi River.
On a cruise aboard the Cajun Queen sponsored by the software company Learning.com, a brass trio played Dixieland standards and educators dined on jambalaya with free beer and wine as the boat eased past the French Quarter and the sun set behind the New Orleans skyline.
Among those on board were three officials from the Madison County, Ky., school district, which has been shopping for software to teach technology skills. It's an area that will be assessed under No Child Left Behind starting in 2006 - and the specialty of Learning.com, based in Portland, Ore.
The district's technology director, Charles Bryant, sat back after his dinner on the top deck and insisted the cruise wouldn't affect the district's decision on whether to buy Learning.com.
"But," he added, "we are looking for something like this."
Back in West Virginia, things have been looking good for Plato, said Dellinger. While waiting to hear from officials in the Logan meeting, he recently got word that the school board in Pleasants County, in the northwestern corner of the state, had approved a $58,000 purchase of Plato software for its alternative high school.
At about the same time, Dellinger drove to the other side of the state, to Pendleton County deep in the Shenandoah range, to pitch the school superintendent, whom he'd recently run into at a statewide conference.
"I just think you have to stay out there," Dellinger said, "and let them know you're interested in helping any way you can."
Coming tomorrow: How well does it work?