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Costing models for computer based interactive systems in the Australian tertiary education context: Effects of learning strategies and degrees of interactivity

William Tan
School of Accounting and Business
Nanyang Technological University, Singapore

Ann Nguyen
Division of Business and Hotel Management
Gold Coast University College of Griffith University


The advances in interactive multimedia technology have provided educators with useful tools to enhance teaching and job training. The application of interactive multimedia for education and training offers not only better presentation of teaching materials, but also faster dissemination of text and graphic information as well as motion video materials and image data. The interactive multimedia courseware provides fast and active interaction with learners, gives timely feedback of learner's response, learning results and subject matters. By incorporating high quality video and digital sound in courseware, it makes the learning process more interesting and stimulating, while at the same time greatly increases the rate of learning and knowledge retention.

It has revolutionised traditional approach in education, learning and training which are until recently based mostly on text presentation. A new frontier can be reached by innovative uses of interactive Multimedia technology. The design and development of interactive courseware can be facilitated by using powerful multimedia authoring software and tools. The interactive multimedia courseware can be developed using low cost PC/MAC/AMIGA and distributed using compact disc interactive (CD-I), CDTV or laser discs, as well as delivered using existing PC/MAC/AMIGA computer laboratory with local area ,networks or mainframe's workstations.

Instructional designers and educators can now design and implement more responsive courseware based on interactive multimedia using motion video clips, sound, computer graphics, video image and computer texts. The interactive courseware can be designed to provide feedback and to interact with learners. Instructional designers can incorporate user friendly interface to allow learners to be in control of their own learning process and follow their own learning paths. It can be expected that good interactive courseware can be created to tailor to individual needs and motivations. Further, a total computer managed learning environment can be set up to assist educators and instructional designers to monitor and assess the effectiveness of their courseware and evaluate the performance of learners in more uniform and consistent manners.

However, the costs of producing interactive courseware are determined by major life cycle items such as the complexity of design and development, whether audio and video production are involved, types of instructional design strategies employed, degree of interactions provided for learners, as well as types of interactive multimedia chosen and types of delivery platforms used.

The life cycle costing models can vary significantly from tens of thousand to hundreds of thousand Australian dollars, ranging from low cost PC/MAC/AMIGA with VGA/TV monitors to powerful mini/mainframe multimedia systems with high definition video and graphics, professional quality in presentation and interactive courseware using professional video and hifi audio production facilities.

This paper attempts to analyse and quantify actual costs for setting up and running an economical computer based interactive courseware using three different levels of interactivity and different instructional strategies. The actual cost models are based on run of the mill typical development and implementation of computer based interactive education systems in an Australian tertiary institution.

Definition of terms

We define following terms to be used as a basis for further discussion:

Computer based interactive (CBI) courseware is defined as the computer based lesson or training program which may consist of motion video clips, still images, computer graphics, digital sound, and text. The lesson is modular and non-linear in structure with large number of pre-planned options which can be chosen by the learner based on his/her learning style. It can provide interactive dialogue with learners and respond with appropriate feedback, instructional sequences or additional options which are tailored to the learner's learning ability, interest, pace and inclination.

Interactivity is defined as a two way man-machine communication between a learner and a CBI system.

Level of interactivity is defined as the capability of the total system including all the hardware, software, and courseware components to effect certain predefined characteristics of interactivity between learners and the CBI system.

It should be noted that the concept of interactivity level, as defined here, is distinct from that proposed by the pioneering Nebraska Videodisc Production Group which designed a scale to describe the technical capabilities of video hardware and its associated interactive process. The so called Nebraska scale has been used to measure the degree of interactivity in video production and are defined as follows (Interactive Video Year Book, 1991):

We propose the following classification for CBI systems based on interactivity level, complexity of implementation and costs of development of courseware:

Computer based interactivity level 1 (CBIL-1) is defined as the level of interactivity at which learners interact via computer assisted courseware, authoring software and computer, using keyboard as input, VGA monitor as output, and computer generated text, drawings and graphics as learning media. This level (CBIL-1) relies on computer assisted courseware and/or authoring software as control program to offer basic text and graphic based course materials. It accepts keyboard and/or pointing device as input from learners. A computer generated animation may be included in some CBIL-1 courseware. No video material is involved. Most Australian tertiary institutions implement CBIL-1 courseware as it can be easily delivered via their exiting computer laboratory at relatively low costs without any significant capital investment on video and new computing equipment. The learning strategy for CBIL-1 is mainly instructional.

Computer based interactivity level 2 (CBIL-2): at this level, learners interact with computer assisted courseware, authoring software, computer and Nebraska level 1 video hardware. It accepts keyboard/mouse/remote controlled unit as input, VGA and TV monitor as output, using computer generated text and graphics, still video images, linear video and/or digital sounds as learning media. Learners may manipulate controls of video equipment to play back linear video by using remote control unit or via the authoring software tool. The cost of implementing and delivering a CBIL-2 courseware is obviously higher than that of CBIL-1 courseware, as additional video capturing and editing hardware/software as well as video equipment will be required.

Computer based interactivity level 3 (CBIL-3): at this level learners interact with interactive multimedia courseware, multimedia authoring software and Nebraska level 3+ hardware. it uses keyboard/mouse/microphone/touch screen as input; VGA/TV monitor, printer and amplified speakers as output; and interactive video, still images, digital sounds, computer generated text and graphics as learning media. CBIL-3 courseware may incorporate integrated parts of instructional, experimental, exploratory and free form learning strategies into its overall design. CBIL-3 has the advantage of providing pseudo live action with motion video which can be used to re-enact and simulate live-like situation to facilitate learning.

CBIL-3 courseware is the most expensive to produce and deliver. Despite this, its cost effectiveness, taking into account the quality of in visual information, live action and interactivity, can be better than those of lower levels. It can therefore be a useful supplement to, and in some cases even a substitute for, instructor led course especially for distant learning.

Role of human instructor in CBI systems

Human instructors have different competencies and presentation skills. Most educational technologists will not disagree that an excellent human instructor can deliver a lecture/tutorial with a presentation style and creative classroom interaction which no CBI system can match or replace. The human instructor is able to handle interpersonal activities, manages the classroom, motivates individuals and administers discipline. However, CBI systems can be used to assist an instructor in providing uniform presentation of course materials for different lecture/tutorial groups, and reinforcing concepts or principles, thereby ensuring consistency and increasing the effectiveness in teaching. For example, with CBIL-2 and CBIL-3 courseware, instructors can provide visual concepts and stimulate classroom discussions, as well as provide a means for slow learners to help themselves with remedial and tutorial aspects of their subjects. We can therefore envisage that in a future high technology classroom equipped with interactive CBIL-3 courseware and with an integrated computer managed learning system, we can revolutionise the learning process away from dreary text based learning process and make learning process more user friendly and responsive to individual learner's needs.

Learning environment for CBI systems

There are two possible learning environments where computer based interactive courseware can be delivered.

One environment is that of total computer managed learning where an integrated computer managed software system and a CBI courseware deal with each learner individually and provide all learning materials, demonstration, tutoring and testing. The role of the human instructor will be to provide administrative and advisory guidance, interpersonal motivation, discipline and counselling to individual. Each learner has his/her own computer workstation for practice, learning and testing with an input device and his/her performance is constantly monitored by the system. Each learner can choose his/her own learning pattern or path. The instructor uses interactive courseware together with computer managed learning software to customise and manage according to his/her specific teaching methods and styles.

The other possible environment is where CBI courseware is used as a teaching component in which the instructor chooses a lesson plan, selects a segment of courseware that is required and then sets up a menu to prepare for the learner to access a specific segment for browsing or learning.

CBI learning strategies

There are many different learning strategies which can be applied to computer based interactive courseware (Malcolm & Howard, 1978; Gagne & Briggs, 1979; Bond, 1988 and Davis & Perry, 1986).

Table 1 gives a comparative summary of four such learning strategies. A CBI courseware provides facilities and media to integrate different learning strategies into one cohesive environment for effective learning. The fundamental advantage of using CBI courseware is to let each and every learner to develop his/her own cognitive learning strategies .

In order to make a cost effective courseware, the designer must be aware of the learner's mental process and activities which produce response, and be concerned with how information is perceived, organised, retained and applied by the learner. For these reasons, there are cases where additional costs required to implement CBIL-2 or CBIL-3 courseware may be entirely justifiable.

Table 1: A summary of four different learning strategies for CBI courseware and roles
which a learner can play in each learning process offered by the respective model strategy.

Type:Tutorial approach (drill and practise)
Nature:Learner is given question and answer instructions. This process tends to be repetitive. The information is provided by course designers who have to assume that the material is suitable for learners. The process is usually applied to reinforce concepts and principles. It offers learner limited control over learning experience.
Learner's role:The role of the learner is that of classroom student or patient. The learning can be enhanced by employing a variety of questioning and feedback style as well as by adding reference materials and/or illustrative graphics.

Type:Problem solving approach
Nature:Learners are allowed to manipulate and test their ideas or hypothesis. They remain in control and follow their own learning path.
Learner's role:The role of the learner is that of a tester who is provided with tools to experiment with various what if decision making solutions or that of an inventor with materials and tools to analyse, address and solve a problem.

Type:Exploration approach
Nature:Learner explores first with tools and materials. After a certain event, facts and structure are then gradually revealed. Learner can experiment with variables within a fixed model but not with the model itself.
Learner's role:The learner act's as a role player and can be led to react more imaginatively. Some applications serve as an emulator allowing learners to develop cognitive and psychomotor skills through simulation games. Effective learning can be achieved by following some realistic simulations or games.

Model:(4) FREE FORM
Type:Free from constraint approach
Nature:Learners are provided with necessary tools to reduce time consuming calculations or processes so that they can concentrate on their own interests and motivations.
Learner's role:The role of the learner is similar to that of researchers who are given a wealth of information without structure so that they can create their own programs and achieve their own learning objectives.

Life cycle costing for different CBI courseware and platforms

The costs of implementing CBI courseware are mainly dependent on the degree of interactivity levels required, learning strategies employed, types of media used, and delivery platforms chosen. The purpose of this paper is to make an objective assessment of these costs. Our approach is to take account of all costs incurred over the entire life of CBI courseware including production, operational and recurring costs. Based on estimates of the typical average times required for courseware development, we compute average production costs and life cycle costs for different CBI models and for an instructor led classroom presentation.

The life cycle costs for various populations of users/students in the context of Australian tertiary institutions are calculated. The population sizes considered are 100, 300 and 600 and 1000. The life cycle costings are then compared across different CBI models as well as instructor led classroom model.

We assume the pre-existence of subject material which has been prepared from subject syllabus with well structured objectives, layouts, contents, and tests. We do not add the costs associated with the development of subject matters because we assume that they are same for all models considered.

Based on our own experience in courseware development at the Gold Coast University College of Griffith University, we can make the following estimate of time required for courseware development and possible reduction of classroom presentation time for different CBI courseware levels and for an instructor led classroom presentation. The estimates are presented in Table 2.

Table 2: Estimates of typical average courseware development times and possible reductions in
instructor's times for different CBI models and that for an instructor led classroom presentation.

Estimates in man hoursInstructor led classroom presentationCBIL-1CBIL-2CBIL-3

Courseware development6 hr18 hr60 hr180 hr
Possible reduction in instructor's presentation time (per student)0 hr30-50%50-70%70-100%
Possible reduction in instructor's marking time (per student)0 hr0.1 hr0.1 hr0.1 hr
Possible reduction in instructor's assessment and performance evaluation time (per student)0 hr0.1 hr0.1 hr0.1 hr

The courseware development time includes instructional design, coding, testing and implementation for Novell network.

The development time for CBIL-2 courseware is about three times that for CBIL-1 courseware, because of the additional time required for graphics and video design, for scanning and editing still computer/video images, and for overlaying computer generated texts on still images. By comparison, the average development time for CBIL-3 courseware is at least ten times of that for CBIL-1 courseware. This is because of the lengthy time required for designing storyboard, for audio/video production, for post-production editing and mixing, as well as for mastering CD-ROM/laser disc. It should be noted that the development time for CBIL-3 courseware can vary significantly depending on hardware platform chosen, audio/video production quality, and type of multimedia authoring tools used.

We tabulate possible reductions in an instructor's presentation, marking, and assessment times in Table 2 to show the likely benefits for using different CBI courseware. However, we do not take account of these additional cost savings in our calculations of life cycle costings because actual cost savings will depend on subject matters, authoring tools and learning strategies used. It should also be noted that the savings in instructor's time can be further improved by implementing a computer managed learning courseware in additional to CBI courseware.

Table 3 shows typical courseware production costs associated with different interactivity levels of various CBIL models and average material and labour costs as at October, 1991 at the Gold Coast University College of Griffith University.

Table 3: Estimates of typical production costs for one hour courseware
associated with different interactivity levels of CBI models.

Item Estimated time, material and labour costs

(1) Material preparation 6 hr6 hr24 hr
(2) Instructional design 6 hr6 hr24 hr
(3) Graphics design --12 hr24 hr
(4) Scripting ----24 hr
(5) Project management ----20 hr
(6) Graphics production --18 hr24 hr
(7) Video production (6 mins) ----$3000
(8) Audio production (30 mins) ----$1500
(9) Authoring and testing 6 hr18 hr40 hr
(10) Post-production ----$1000
(11) Disc mastering ----$3000

All estimated times are in terms of man hours. We assume that staff with equal competent skill are involved even if using different authoring tools. Obviously, the breakdowns and times estimated for courseware development are only representative. Actual times taken will vary depending on subject matters, authoring tools and the competency and experience of courseware developers.

The cost estimates for audio/video production and post-production are that of average production costs for near professional quality at Gold Coast University College of Griffith University and costs for disc mastering will vary depending on whether it is done in house or out house, type of optical discs used, and number of discs produced.

We assume that for CBIL-3 model, only ten percent of presentation are of motion video at about $500 per minute video footage and fifty percent voice over and audio at $50 per completed minute. The video footage and audio costs are only a fraction of that of commercial production because we assume all production are done in house ( at Gold Coast University College of Griffith University, we have low cost mini audio and video suites ) and quality of production is of near professional quality.

Table 4 tabulates total life cycle costings for a 20 hour unit for different CBI models based on production costs given in Table 3.

Table 4: Total life cycle costings of a 20 hour unit for different CBI
models and for that of an instructor led classroom presentation.

ItemInstructor ledCBIL-1CBIL-2CBIL-3

1) Courseware production costs
1a) man hours per 1 hour courseware in design and development 6 @ $301860180
Cost per 20 hour unit =$3600=$10800=$36000=$108000
1b) Video/audio production and disc mastering
(Table 3 : (7)+(8)+(10)+(11))
00020 @ $8500
Cost per 20 hour unit =0=0=0=$170000
Sub-total (1A) + (1B)

2) Operational costs per classroom/lab session per 10 students workstations for 20 hour unit
2A) Classroom preparation & assessment 1 hr @ $30 =$600000
2B) Instruction costs 1 hr @ $30 =$600000
2C) Machine rental costs 01 hr @ $1 =$2001 hr @ $2 =$4001 hr @ $3 =$600
2D) Material costs 0$1/disc =$200$6/disc +tape =$1200$20 CD-ROM/ laser disc =$4000
(Assume that each lab session operates with 10 workstations, and each lab can handle 10 sessions per day, ie. material costs for each lab can cover 100 students or 10 lab sessions for 3 to 5 years.)

3) Three year life cycle total recurring operating costs for four different population sizes
3A) 100 students 10 classes10 lab-ses10 lab-ses10 lab-ses
3 yr (2A+2B)
3 yr (2C)
3 yr (2D)
Sub-total =$36000=$6200=$13200=$22000
3B) 300 students 30 classes30 lab-ses30 lab-ses30 lab-ses
3 yr (2A+2B)
3 yr (2C)
3 yr (2D)
Sub-total =$108000=$18600=$39600=$66000
3C) 600 students 60 classes60 lab-ses60 lab-ses60 lab-ses
3 yr (2A+2B)
3 yr (2C)
3 yr (2D)
Sub-total =$216000=$37200=$80200=$132000
3D) 1000 students 100classes100lab-ses100lab-ses100lab-ses
3 yr (2A+2B)
3 yr (2C)
3 yr (2D)

4) Total costs for three year life cycle, (1)+(3)
4A) 100 students
4B) 300 students
4C) 600 students
4D) 1000 students

All man hour costs are about $30 per hour (as at October, 1991) based on ongoing wages of senior tutors, instructional and graphic designers and programmers.

The average time taken for development of CBIL-3 courseware is taken to be about 10 times for that required for CBIL-1 courseware and 3 times for that required for CBIL-2 courseware based on typical breakdowns of development times given in Table 3.

For each hour of CBIL-3 courseware, there is an additional cost of about $8500 for audio/video production and post-production as well as for disc mastering and replication. If linear video is used as part of CBIL-2 courseware, a similar cost for production of audio/video materials will need to be added to its production costs.

The delivery media assumed for CBIL-1 courseware is diskette at a cost of $1 per student/learner, that far CBIL-2 courseware is diskette and video tape at a cost of $6 per student/learner, and that for CBIL-3 courseware is diskette and optical disk (CD-ROM/laser disc) at a cost of $20 per student/learner.

A typical life cycle of courseware is taken to be 3 years, however, if the life cycle is extended to 5 years after update at end of 3 years, there will be additional cost savings for all CBI models when comparing with an instructor's led classroom presentation.

We are deliberately non-specific on delivery hardware to allow for fluctuations in prices for different Makes of hardware and delivery platforms. However, we take the approach of amortising cost of delivery hardware into hourly machine rental rate. We assume that the typical cost for a delivery workstation including run-time costs for authoring software for CBIL-1 is $3000, that for CBIL-2 is $6000 and that for CBIL-3 is $9,000. If we amortise the cost of workstation over 3000 hours (life time for PC/MAC is between 3000 to 10000 hours), then we can reasonably assume that the life cycle cost of machine rental time to run CBIL-1 courseware is about $1 per hour per workstation, that for CBIL-2 courseware is about $2 per hour per workstation, and that for CBIL-3 courseware is $3 per hour per workstation.

Table 4 shows that a direct comparison based on simplified models of interactivity levels can be obtained. Not surprisingly, the costing models show that as the degree of interactivity increases, the cost of development and delivery platforms increase accordingly. At first glance, the CBIL-3 look like a more expensive proposition than instructor led classroom instructions. However, for a large number of students/learners (more than 1000), the life cycle costs of CBIL-3 courseware can be cost effective. If the courseware production costs can be reduced by using templates, a significant cost saving can be achieved. Together with cheaper delivery hardware (eg. using CDTV student workstations which cost below $1500), the cost of CBIL-3 courseware can be more than halved, making it more attractive and lower costs than that for an instructor led presentation.


In conclusion, the life cycle costings for CBI courseware are complex and depending on many factors. However, by considering simplified and realistic models of interactivity levels, we can derive some estimates for life cycle costs per student/learner for a given population size. Although CBIL-3 courseware will require high initial development costs, more creative instructional strategies and interactivity design and complex audio/video production than that for either CBIL-1 or CBIL-2 courseware, the results show that CBIL-3 courseware can be attractive and more cost effective than that of an instructor led presentation for a large population size. One must note, however, that some technical advancements and improvements, especially in audio/video compression techniques, transmission speeds, capacity of storage media and networking and authoring software, are still needed before the CBIL-3 type of courseware can be widely used throughout networks and classrooms.


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Authors: Dr William Tan is a Senior Lecturer in the School of Accounting and Business, Nanyang Technological University, Singapore. Ann Nguyen is Lecturer (Computing) in the Division of Business and Hotel Management, Gold Coast University College of Griffith University.

Please cite as: Tan, W. and Nguyen, A. (1992). Costing models for computer based interactive systems in the Australian tertiary education context: Effects of learning strategies and degrees of interactivity. In Promaco Conventions (Ed.), Proceedings of the International Interactive Multimedia Symposium, 127-148. Perth, Western Australia, 27-31 January. Promaco Conventions. http://www.aset.org.au/confs/iims/1992/tan-w.html

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