A New Model

We've written a lot lately about major shifts occurring in how higher education is perceived and how it will be delivered in the near future. The need for a paradigm shift is beginning to sink in. So the following doesn't come as any particular surprise:

"This is not buying a house," says [education entrepreneur Gene] Wade, co-founder and chief executive of UniversityNow. "This is like, do I want to get cable?"
New Charter offers a try-it-before-you-buy-it platform that mimics the "freemium" model of many consumer Web services. Anyone can create an account and start working through its self-paced online courses free of charge. Their progress gets recorded. If they decide to pay up and enroll, they get access to an adviser (who helps navigate the university) and course specialists (who can discuss the material). They also get to take proctored online tests for course credit.

The project is the latest in a series of experiments that use technology to rethink the economics of higher education, from the $99-a-month introductory courses of StraighterLine to the huge free courses provided through Stanford and MIT.

That line about cable is more than just a quip. For the vast majority of homeowners, a house represents the single largest financial commitment made in a lifetime. In recent years, higher education has been giving home ownership a run for the money -- literally -- establishing itself as the other massive, decades-long purchase that one is expected to make.

 Cable, on the other hand, is a mass-market consumer service. It is a commodity. And it is strictly optional -- many people get by just fine without it. Deciding to pursue a four-year undergraduate degree is completely unlike deciding whether you're going to get cable (or which package you're going to settle on.) Your career and livelihood will never depend on whether you get the Starz or HBO bundle.

 So we face this interesting choice over which model should apply. Considering its potential value to your life overall, not unlike the value of the home you live in, shouldn't education cost a lot? Your house costs a lot; therefore, so should your degree. Alternatively, seeing how a good deal of what constitutes education -- certainly not all, but a good deal -- is content that can be delivered along the same lines as the content you receive with your cable TV package -- why should it cost that much more?

 You don't have to guess which argument makes sense to me. That first equation is flawed in that it compares something that is truly scarce with something that is rapidly becoming easier and cheaper to access, share, and distribute. Plus, the asserted value for money isn't necessarily there. Decades of student loan payments may be worthwhile for some degrees and career tracks, but they are a huge burden for many others. That's where we get these "college isn't worth it" analyses.

 The new equation recognizes that everything is becoming a coffee shop -- that institutions of higher education are bound to follow the same basic path that employment firms, travel agencies, and (increasingly) banks have followed from the real world to the cyber world. We can bemoan the diminishment (not complete loss, as is often stipulated) of personal contact all we like -- and there are definitely real risks and trade-offs involved there -- but the transformation will occur precisely to the extent that people realize value in adopting the new model.

Cross-Posted from Transparency Revolution.


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