For-profit Higher Ed and the MOOC opportunity



A colleague sent me a note today wondering if the news of for-profit EDU financial difficulties and the concurrent rise of the massively open online courses (MOOCs) are related. Correlation or causality?

The Apollo Group, owner of the University of Phoenix, has seen its stock price decline by almost half since the beginning of the year. This week the Apollo Group announced that it is closing 25 campuses and 90 satellite learning centers. 800 jobs will be eliminated. The reason. Enrollments are down 15 percent. Revenues off by 10 percent.

My take is that the financial challenges of U. of P. and other for-profits do not have much to do with the rise of the MOOCs. Enrollment decreases at for-profits are probably driven more by a tightening of federal student loan standards than by students choosing the MOOC option. I sort of doubt that U of P and MOOCs have been drawing from the same student population base – but this is worth looking at.

What traditional higher ed offers (and here I include the for-profits in the \”traditional\” category) are credit bearing courses that add up to a degree. The higher ed business is built around credentialing, something that for-profits now offer and MOOCs do not (mostly, yet).

I see at least 3 opportunities (perhaps you could suggest more) for for-profits and MOOCs:

Opportunity 1 – MOOC / For-Profit Partnership: U of P, Capella, Kaplan, DeVry – one of these players should think about offering a course through edX, Coursera or Udacity. The for-profit provides the faculty and the content. The MOOC player provides the platform. Branding and intellectual property stay with the for-profit, and MOOC provider gets another course to offer. Why would a for-profit sink 50 grand into a MOOC, with no revenue on the other end? How about a terrific up-sell into their for-profit university? Exposure, marketing, and attention.

Opportunity 2 – Run a MOOC:
The for-profit could skip working with the established MOOC providers, and offer their own MOOC on their own platform. Great exposure to how a \”regular\” class is run. A fast path to channel a subset of the MOOC students into full matriculation. The offering of scholarship opportunities for the best students. Exposure, marketing, and attention.

Opportunity 3 – Give Credit for a MOOC: For-profits could offer credit within their institutions for students who successfully complete a MOOC. This would lower total costs for anyone who transferred credit into the for-profit once they matriculate. Credits could be transferred for potential and existing students. The for-profits could even come up with an exam that certifies that credit should be awarded.

Do you know of any examples of for-profits doing something interesting in the open education world?