How to Fulfill the Promise of Online Education
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Many colleges and universities have hired private companies to build and operate their online education programs. Firms such as Academic Programs, 2U, Coursera, the College Network, and Pearson work quietly behind the scenes to convert traditional courses to online formats, recruit students, follow up with students, and even supply courses. They are known as online program managers (OPMs).

The Century Foundation, an explicitly progressive organization, recently expressed concern about these relationships. Its report, authored by Margaret Mattes, was based on reviews of 117 contracts between nonprofit schools (mostly public universities) and private OPMs. She concluded the companies provide “services so intertwined with the actual teaching and learning” that they may undermine the independence of the universities. Mattes worries the companies may be cutting quality, raising prices, and bringing in unqualified students.

“Driven by the desire and need to make money for investors or owners… these companies may prioritize profit over the interests of online students, to whom they owe no loyalty, financial or otherwise,” Mattes wrote.

Mattes is right to question the operation of online education, but she is misdirecting her concern. Online education, if operated properly, will bring cheaper, customized, and innovative education to a much broader range of college students — something most universities say they want to do but has yet to occur. Even when universities use OPMs, they normally set the tuition at the same or a higher price as traditional courses, according to the well-respected WICHE Cooperative for Educational Technologies.

Why aren’t prices going down? Most universities are too traditional to act boldly. Online courses need special digital platforms and techniques and new kinds of recruitment. Many faculty members don’t want to teach online courses, and administrators don’t know how to reach non-traditional students.

Recognizing this, administrators have switched to private firms to manage programs. The firms usually pay the upfront costs, and in return, they receive 50 percent or more of the revenues they bring in. These strategies have proven to be somewhat successful, but more innovation is needed.

Earlier in 2017, the Clayton Christensen Institute (CCI) issued a report on online education. CCI’s report explores several bold experiments and new technologies that can improve education. Most of them involve OPMs, but they go far beyond the traditional approaches.

For example, Arizona State University’s (ASU) “Global Freshman Academy” (GFA) allows students (possibly returning students) to take one year of online courses at a low cost — in essence, giving them the opportunity to “try out” college. Under GFA, students pay $49 to start a course and pay tuition upon successful completion of the course — about $200 per credit hour, or $600 per course.

“GFA is designed to give these students a second chance by allowing them to demonstrate their readiness by completing GFA’s eight college-level courses online,” the CCI report explains. “GFA is designed to maximize access, rather than maximize the traditional metrics of prestige.”

GFA’s first year did not provide the results ASU was hoping for. Fewer than 1 percent of enrollees successfully completed the freshman courses (323 out of 34,086 who signed up), according to a report by Inside Higher Ed. While this success rate is far from ideal, it’s undeniable the 323 students who did succeed received an inexpensive start to their college career. Also, those who didn’t finish presumably concluded the program wasn’t a good fit, saving a lot of money over the long term.

A more radical program offered by a traditional college is the College for America program sponsored by the University of Southern New Hampshire (USNH), a private university. While USNH still has a brick-and-mortar campus, its total university enrollment has skyrocketed well beyond its walls. In 2003, USNH had 2,500 students enrolled. Today, it has more than 63,000.

Purdue University could have similar growth in mind. It bought Kaplan University, a for-profit university, earlier in 2017. After announcing the agreement with Purdue, Kaplan cut its prices to $220 per credit hour for Indiana students. That’s lower than Purdue’s normal offerings and could open up a substantial new market for the college.

Online education will be an important higher-education issue for years to come. The Century Fund should not merely attack the role of private companies, but rather judge whether OPMs contribute to higher education’s goal of providing greater access for students of every background. Contrary to the fear-mongering of some online-education detractors, innovation will eventually win out, providing greater opportunities than have ever been offered before to more people than ever — but only if colleges continue to pursue determining the best practices for merging technology with higher education.

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