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Udacity Doubles Prices, Relaunches 1-on-1 Mentorships & Career Coaching

Manoel Cortes Mendez

Udacity's new $399 monthly price

Last week, Sebastian Thrun, CEO of the $1B e-learning startup Udacity, made three important announcements:

  • New Prices: Udacity is revamping its Nanodegree pricing scheme: fixed fees are replaced by a $399 monthly fee — amounting to a significant overall price hike.
  • New Mentors: Udacity is expanding its mentorship model to offer more individualized, end-to-end support to Nanodegree students.
  • New Scholarships: Udacity is launching two scholarships, sponsored by Facebook and Bertelsmann, that will allow selected learners to pursue a Nanodegree in an AI area.

The first two initiatives are the culmination of a restructuring plan initiated by Udacity in late 2018 to increase Nanodegree graduations and reach profitability by the end of 2019.

Rough Patch

In Udacity’s Year in Review, Dhawal Shah, Class Central CEO, noted that 2018 had been a difficult year for Udacity. The company registered lackluster growth, forcing it to take drastic measures. Vishal Makhijani stepped down as CEO and Sebastian Thrun, Udacity founder, stepped in. The company closed or downscaled several of its offices around the world. Some of its Nanodegrees, such as those dedicated to virtual reality, aren’t accepting enrollments anymore. And in three rounds of layoffs, Udacity parted with over 40% of its employees.

Alluding to the need for restructuring, Thrun simply explained: “our trajectory was not long-term tenable.” He later added that through these initiatives, he was confident Udacity could “continue to grow […] while achieving a break-even position.”

Increased Prices

Amid the two other, seemingly positive announcements, Udacity revealed an important change to its Nanodegree pricing.

Since the company completed its switch to term-based scheduling in June 2018, as originally reported by Class Central, Nanodegrees have had a fixed price (between $600 and $2,400) that gave learners access to the Nanodegree content for a predetermined amount of time (between 3 and 8 months).

Going forward, all Nanodegrees will cost $399 per month, with estimated completion times ranging from 3 to 6 months. According to Udacity, these time estimates are data-driven: “The suggestions are based on data we collect on what is a realistic time frame to fully get the most out of our Nanodegree programs.”

Therefore, in light of Udacity’s own time estimates, students can expect to pay between $1,200 and $2,400 for their Nanodegree. So although the cost of the longer, more expensive Nanodegrees remains the same, the cost of the shorter, more affordable ones — that is, the vast majority of Udacity’s catalog — has effectively doubled.

Udacity argues that its new pricing scheme is more flexible. And all Nanodegrees now include the extended Mentor and Career support. But whether students will be willing to pay a premium for these features remains to be seen — particularly considering that:

  • Last year, Udacity already increased Nanodegree prices by as much as 300% — these used to cost $200 per month at launch.
  • Two years ago, Udacity stopped promising Nanodegree graduates a job and 50% of their tuition back if they graduated in less than a year.

Revamped Mentorships

For the better part of the past year, Udacity has been using a community-centered approach to learner support: Nanodegree students would ask questions on the Student Hub — a Slack-like communication tool built into the Udacity platform — and receive help from Mentors and students alike. This form of support will continue to be available.

Udacity Student Hub

But moving forward, each Nanodegree student will also be paired with a dedicated Mentor who will offer one-on-one support via chat or video calls, and present webinars on technical subjects. Besides answering questions, Mentors will provide students with a sense of accountability by helping them set weekly learning goals.

In addition, Nanodegree students will receive support from Career Coaches. According to Udacity, half of their students are job seekers. Career Coaches will assist them through their job search, notably by offering personalized resume feedback and interview advice.

In a sense, Udacity is reverting back to its old ways: up until mid-2018, they used to match students with dedicated Mentors in some Nanodegrees. However, their new approach strengthens the bond between Mentors and Mentees with a view to building a community that isn’t just large, but also cohesive. The approach reminds us of other e-learning companies, such as Springboard, which also includes one-on-one technical and career assistance for an end-to-end support experience.

Through this new mentorship model, Udacity hopes to raise Nanodegree graduation rates from 34% to 60%.

New Scholarships

Udacity announced the launch of two new scholarship programs. These involve a two-step selection process. Students that make it to the end will get the chance to complete a Nanodegree in an AI-related subject, free of cost.

The first scholarship is offered by Facebook and is a continuation of last year’s PyTorch Scholarship. This year’s scholarship is centered around AI, privacy, and data security, and will allow top-performing students to pursue a Computer Vision or Deep Learning Nanodegree.

The second is offered by Bertelsmann — one of Udacity’s largest shareholders — and is a continuation of last year’s Data Science Scholarship. The scholarship is centered around cloud computing, data, and AI.

Applications for Facebook’s scholarship have already opened; the deadline is on May 21st. Applications for Bertelsmann’s scholarship will open in summer.

    Comments 10

    1. Avatar

      Joseph Saber

      I was planning to take Programming for data science next summer at 600$ in the old payment plane to finish the degree in 3 months now it costs 1200$ to finish it in three months that is so expensive considering its basic beginner content is available everywhere for free (SQL – basic python – git )

      charging a fixed price (400$ per month) for all nanodegrees beginner and advanced will makes the beginner NDs very expensive and very hard to justify

      Data Analyst was 1000$ now it costs 1600$ that’s a huge jump in price

      learn to code is a basic beginner ND it costs 1600$ ( the same price as full stack web developer ) that is insane

      personally I’ve cancelled my plans to take programming for data science ND as a student and a customer I care more about value than flexibility in learning which the new payment method lacks

      Reply
      • Avatar

        Nikita

        Maybe the reason of company’s problems is in huge prices?
        When people decide to change careers and learn new field (or just learn a new field), usually it is not people who can allow to spend $2400 on a few months course. I think company currently targets the wrong audience.

        Reply
      • Avatar

        Konstantin

        There are plenty of other places offering great courses. You don’t need a certificate at the end if you play around, build a portfolio, and learn to communicate your skills.

        Reply
    2. Avatar

      noah

      there’s no Bertelsmann schoalrship

      Reply
    3. Avatar

      Shagan

      Really steep prices, imho. Is there any alternative thats more affordable, with hands on lab exercises?

      Reply
      • Avatar

        Lyle D Moriarty

        For general CS type stuff, take a look at University of The People. They offer a solid undergraduate curriculum at $100.00 per course for the final exam. Non-profit,
        nationally accredited, tuition-free ( just pay $100 for the final exam) and a global student body. If you can’t afford the $60 application fee or the $100 per final exam
        fees then you can apply for a scholarship.

        Reply
    4. Avatar

      gilian

      totally agree with the comments above on Udacity being ridiculously overpriced, I completed a ND this year under the old pricing however still significant at approx $1000 for the DAND. under the new pricing someone in my position would pay $3000. The fact that mentorship etc is offered has limited value to part-time students such as myself juggling family, work and study – there is simply not enough time to do this like you would do a uni degree, which is where the ND (added) value. I’ll be shopping elsewhere in future for my educational requirements, fortunately there are a lot of options such as Pluralsight and Datacamp etc.

      Reply
    5. Avatar

      Rasheed Narejo

      I got 2 nanodegrees and used 0 of their help with these degrees or career help. Since then fixed Nanodegree prices were doubled and now they have moved to term based pricing. For most full time working students, there is little predictability in terms of time frame needed to complete a program. I already saw little value for paying $1000+/nanodegree but if I ever had any hope to enrol again for some specific program by Udacity, that hope is over now. I feel there is more value for money by fixed monthly self learning portals like Coursera and Datacamp.

      Reply
    6. Avatar

      Noname

      I currently still work as a mentor after doing an ND there, they effectively do not pay us under the new payment structure. Its fairly ridiculous to charge students these prices and then not to pay the only source of correspondence to them. And that is how motivated the mentors are at the moment: zero. And I don’t believe that i need to say that, but in the world we live no one can work for free, especially not for a Silicon Valley tech company. I was hoping to stick around until they change back to the way it was, but instead of doing that or adjusting payments, they push hard with repetitive emails including prepared text blogs that we ought to send each student. Also they came up with a slack channel for mentors to pressure them, as well as kind of mandatory webinars and the „7Cs“. It’s unlikely I do another course there myself. Chances are Udacity is finished, at least without a miracle whatsoever

      Reply

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