the needle's eye

"The simple truth is that nobody has figured out how to build a cheap, high-quality online university. Not even close. So far, the biggest investments in Internet education have come from the for-profit sector, and their results have been, to put it lightly, lacking. For-profit graduates have worse job prospects and earn less than their peers who attend nonprofit schools. A new study released this week suggests that many for-profit diplomas are literally worthless in the marketplace. This even holds true when you control for student characteristics like wealth. And so perhaps not surprisingly, their alums are responsible a disproportionate fraction of student loan defaults. Worse yet, these schools are expensive. According to the most recent Department of Education statistics, the median net price of attending a for-profit bachelor’s degree program is almost $21,000 year, compared to about $10,000 at a public institutions and around $19,000 at private not-for-profits. A year at the University of Phoenix’s Tulsa campus ran students $25,987 in 2009-2010, up more than 7 percent from 2008-2009. This isn’t just a matter of these schools reaping large profits. Even with the efficiencies of the internet, education is still a labor-intensive endeavor. Unless your degree program consists of nothing but multiple choice tests that can be graded via computer, you still need instructors who can grade assignments, supervise in-class discussions (even if those discussions happen in a chat room), and help lagging students with the material."

"We are no longer a newspaper company."

"It is investment on a breathtaking scale, but most of it will not matter. Here is why: Most of this investment is for commoditized technology in the service of the classroom. Squandering strategic investment in improved classrooms fundamentally disadvantages those colleges that are most in need of change. Here is how to rewrite Nicholas Carr’s message for higher education: “You are making a strategic investment in a commodity that will soon be freely available to everyone. Worse, you are using it to automate a business model that will soon be irrelevant."