Reduced Drop-out rate as a Financial Risk in Distance Learning Programs Interaction lies at the heart of all education. E-learning is no different. Previous research has shown that the amount of student interaction is likely to improve the distance-learners’ educational experience, e.g. Andrusyszn et al, (1999), and Wright et al, (2000). There is a number of different interactions to consider in education from a pedagogical perspective: Since Moore (1989) defined (1) interaction with the content, (2) interaction with the instructor, and (3) interaction with the students, an additional new fourth dimension has been added by Bouhnik, Dan and Marcus, Tali (2006), named interaction with the system, the interaction with all of the new computer technologies. New and more difficult technology can be a reason for students to drop out, but it can also be a reason for them to stay. It is all a question of what technologies are used and how. As e-learning programs are constantly being developed and universities have become more financially depended upon these programs, the reduction in drop out rates has become an increasingly important issue.

Conclusion Some of the major challenge as is concerned software is the speed with which new technology is developed. It is improbable that there will ever be one lasting solution for all needs in distance education. Instead the teaching Institution has to set its own realistic goals for the use of new technology in distance education. Factors to consider are: • What is the state of the Art; and what are other institutions using? • What resource allocations are needed to introduce the new technology, including teachers’ training? • For how long can we expect to profit from this change in technology? • How do we implement the new system most efficiently? (E.g. implementation over summer, running parallel systems for a while in case of break down) The risk so far has been that the ambition level has been set too low and that the solutions selected has not led to the interactivity requested by students. Demands by students are going to be a result of the experience they gather with the use of other software solution outside of the university. They are going to know pretty well what is the State of the Art. This experiencing is going to define their expectations and need. One of the parameters which are to decide new technological platforms to implement should be based on higher interactivity. The experience with too low interactivity at MAM seems to suggest at higher drop-out rate. This is particularly a problem for universities and educations which charge a lower or no student fees and tuition (low exit barrier).