Almost 90 per cent of United States higher education institutions will offer online distance learning courses within three years, according to projections.
A report, Distance Learning in Higher Education: Market Forecast and Analysis, 1999-2004 , from market research firm IDC, estimates an annual growth rate in online learning of 33 per cent, as more universities - public and private -take advantage of less expensive and simpler methods of offering distance programmes.
A growing acceptance of online learning is another factor driving demand. There was an estimated 55 per cent increase this year in the number of institutions taking the online plunge. The figure for 2000 was 47 per cent.
Stephen Webber, IDC education markets research analyst, said that more than 3,300 courses, up from 1,500 in 1999, will be available in the US by 2004.
"E-learning is evolving at a healthy pace," he said. "Technological advances and the changing needs and interests of students and universities have changed e-learning from a simple correspondence course to a model that includes the myriad high-tech, synchronous and asynchronous solutions we're seeing today."
IDC believe that almost all of the equity capital raised in the US education industry last year has come from the online distance-learning sector.
Despite many investors turning their backs on the internet in late 2000, Mr Webber said the financial community would continue to support online learning.
One reason is that spending will continue to rise, from about $334 million (£226 million) last year, to an estimated $744 million in 2004. According to IDC, the cost of staff, hardware, communication services and related support for distance learning will bring the total to nearly $3 billion by then.
Mr Webber warned that in such an active market, even established players would have to offer innovative approaches to maintain a competitive position.
US education department estimates indicate that there are more than 230,000 providers targeting some 138 million students or clients in school and corporate communities.