The business of education

Tony outlined some web 2.0 business models the other day. Stephen Downes picked up on this, and commented

"[I] am compelled to think that the disaster that happens when democracy is for sale is nothing compared to what will happen when learning is for sale"

As Tony was thinking about SocialLearn, this is something I've been musing over for a while too. So, I offer this post up in the spirit of debate, because even putting the words business and education in the same sentence is heresy for some, and yet I think we will face some very difficult choices in this area over the coming decade, so we can't ignore it.

I think we should be clear that any Vice Chancellor will already tell you that education is a business. Even if students don't actually pay themselves and are funded by government, freedom of choice as to where they go, effectively creates a market. Lecturers, administrative staff and librarians don't work for free and buildings don't build themselves. Universities are therefore competing for students, and so will offer courses they think are attractive, facilities that are appealing and trade on a brand name. To this extent education is already 'for sale', and it is difficult to see how within current society it will change.

But, the situation is likely to get more complex and if the business aspect is currently hidden then it is will become more explicit. The driving forces behind this change are numerous, here are some candidates:

• Decreasing Government funding - the model of Government paying for the entire student education has been dwindling since they cut maintenance grants in the UK, and similar trends have been seen globally. With top-up grants and cutting of ELQ funding in the UK we can see a general move towards universities having to become less reliant on subsidy (I'm not saying this is a good thing, just highlighting it as a pressure on Higher Education).
• Increased competitiveness between universities - the explosion in student numbers during the 1990s saw expansion in higher education institutions. Now that these numbers have levelled off, there is increased competition between these institutions for students.
• Globalisation - many 'Western' countries specifically target overseas students, who bring in more funding. It is likely that host country universities will fight back against this, moving competition on to a global scale.
• Increased complexity in the education market - if you are a learner with a specific requirement then universities are no longer your only option. Not only are there commercial organisations who may offer training, but there are a range of other providers who have educational content which may meet your needs, e.g. Sky, BBC, The Guardian, YouTube, OERs, etc.

You may disagree with my list, but I think these are all observable forces and there are probably more. As I've already mentioned, my intention is not to argue that these are benevolent forces, but that we should recognise them and consider how higher education should respond.

I think there are two broad tactics, and then many different interpretations of each. The two main responses can be labelled political and pragmatic (they are not mutually exclusive, you could engage in both). A political response is what I guess Stephen would advocate - these argues that the existing society which creates these pressures is at fault and we should seek to change that. The pragmatic response (which I guess I'd advocate) argues that we should find practical ways of operating within this new environment.

So, to come back to the business models, here are some questions which I genuinely don't know the answers to, but which we may have to find soon.

1. Is advertising revenue ever acceptable? E.g. would ads run on a university site that provides funds for student services compromise a university.
2. Is providing free resources and tools, but charging for support and accreditation acceptable?
3. Would 2) be acceptable if the learner didn't pay, but used Government subsidised 'vouchers'?
4. Is a model that relies solely on Government funded students viable?
5. Would charging companies, not individuals, for professional development be acceptable?
6. If we believe in OERs, how do we find a sustainable model for them that allows educators to be employed while giving away their content?

And there are many more. The point is that technical and social changes are being felt by higher education. Some of this will be good, some will be bad, but we are likely to face some difficult choices, which we should start considering now.

Comments

[Stuart]

hi martin.
there are some similar discussions going on at the moment around social media (as you know especially re twitter). There's a bit of a discussion here http://vanelsas.wordpress.com/2008/05/29/on-twitter-and-the-missed-opportunity-to-execute-a-social-utility-business-model/ with some interesting links.

Also a video on TED http://www.ted.com/talks/view/id/247 about open source economics. I'm sure you're familiar with most of this anyhow!

[Gary Lewis]

Didn't see a way to do a trackback, hence the comment. I wrote a short piece on your recent exchange with Stephen Downes. You can get to it from the url.

[Glen Moriarty]

Thanks for the post. We've been working through these same issues and it sounds like we are coming to the same conclusions.

Also, just as a quick aside, I saw that you are contributing to Michael Feldstein's special edition of On the Horizon. I am too. I look forward to the dialog.

[Peter Murray]

Martin --

Your posting, and corresponding coverage in the Chronicle of Higher Education Wired Campus blog ( http://chronicle.com/wiredcampus/article/3053/ ), inspired some of my own thoughts on the topic -- particularly as it relates to search engine results placement in libraries ( http://dltj.org/article/libraries-selling-placement/ ). Thanks for bringing up the topic.

[suzzane donald]

When I attended the Business of Personal Training workshop nearly 2 years ago, our business was doing 'good', but not 'great'. What became very clear to me in doing the workshop was that we were lacking in something very simple... systems.
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[Bedava sohbet]

there are lots of very similar discussions.

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Thanks for the post. We've been working through these same issues and it sounds like we are coming to the same conclusions.

Also, just as a quick aside, I saw that you are contributing to Michael Feldstein's special edition of On the Horizon. I am too. I look forward to the dialog.

[danial]

good blog