Is "Traditional" College Dying?

Assessing the Threat of Online Universities

      Sustainable business thinking attempts to determine the likelihood of various industries' success in the near future. One could easily argue, for instance, that the death of the DVD market is quickly approaching or already here; digital streaming and downloads have rendered physical copies essentially obsolete. I mentioned that this blog would try to occasionally explore topics like this; hopefully this is but the first post of many. 

      The days of brick and mortar or "traditional" universities seem to be numbered, with online education's extent ever-increasing in size; with the price of education continuing to rise across the board, more and more students are turning to online courses to either supplement their education or replace it. According to Columbia University’s Community College Research Center, approximately a third of all current college students are enrolled in at least one online course (NYT ed) a number unthinkable a decade ago and one likely to only rise. Some advocates of online education see it as a logical response to the current failings of various education systems (Department of Business Innovation and and Skills), offering several key benefits that traditional colleges currently lack, an argument that is both well supported and neatly intuitive. In that vein of thought, the Online Education Database spells out 10 reasons online education is special; reproduced here are the 3 most distinct.

• First, the access of online college is far greater than that of a traditional school. While a physical location artificially limits it's audience to those in the area or who travel from afar specifically for it, online education can be accessed by anyone with an internet account. Considering that number is currently hovering around 3 billion people (http://bit.ly/RdZ6QH), that's a far larger market than all colleges combined might have access to. 

• Second, the cost of online education can be much lower than traditional education, something that will likely only increase in the near future. Since coursework and materials can be recycled ad infinitum once created, the costs to maintenance drop significantly after the first year, coming down mostly to web hosting costs and payment for teachers or assistants to grade certain things computer software is unable to. This is admittedly circumstantial, as some colleges charge more for the online course "convenience," but the lack of room and board, travel, and supply costs more than make up for this. With the rise of MOOC's (massive open online courses), free online classes sometimes for credit usually led by a qualified professor, the competitive advantage only rises; normal colleges do not give away credits for free.

• Third, the time flexibility of an online course is a much more open; students can complete assignments whenever they want before the due dates (most normal classes assign them a day at a time) and watch lectures whenever they choose. Normal college has course schedules and expected completion dates and times to study, all of which interfere with attempting to balance things like heavy credit loads or a job. 

      But even with all of these benefits, I don't think the logical  conclusion is that "traditional" colleges are dying; I think the right answer is that their current model is unsustainable. My argument is that online education's rise is doing more to correct that model than destroy it, and "traditional" colleges can easily survive online universities' rise by stressing the key benefits that they offer. Offline colleges might need to alter the shape of their offerings in the next decade, but as long as properly managed, they will be able to weather the oncoming storm of internet offerings. 

The Strengths of "Traditional" College

      There are five primary reasons that traditional college isn't dying out. There are definitely more; these should however encompass most of them. 

• First, brick and mortar schools have mostly expanded into the online classes market already. Most universities now offer certain classes online, or hybrid classes that place the homework on the web and the activities in the classroom. It doesn't matter then if online college encroaches on the college's potential students, as it seems unlikely that third parties can encroach on the market when the market already supplies classes run by qualified faculty.

• Second, it is very unlikely that online classes can possibly offer every single course that a university can. Many classes are specialized seminars or composed of hands-on laboratory assignments or require special field trips or need student to build models to build their respective skills. Online courses can't do all of that; those things require a physical presence. A strange but likely objection is that virtual reality is becoming steadily more advanced and could soon (Facebook's acquisition of the Oculus Rift technology at least indicates that the market is advanced in VR development). It seems likely that in the near future students could experience lectures and labs and model-making all from the comfort of their homes. But even if that occurred...

• Third, colleges have a great deal of resources that online classes cannot offer.  In a single word, these resources all are "connections." Online professors can't access your skills, work with you on research, and draw conclusions about your character. They can't recommend you to important contacts and build up your social network to increase your chance of job placement. You won't meet new friends and build solid relationships in online colleges, two things that could again land you a career. It is my belief that much of the role of college currently is building yourself as a person, exploring different career possibilities, debating moral, political, and philosophical views to decide what you believe independently from parents and the views of those you've grown up with. This won't apply to everyone, but should generally apply to most people. College is less about the "learning" and more about the "education," the development of people into individuals able to face the world. Online schools lack that unless classes are merely additions to current workloads and not the only form a student is receiving credits. 

• Fourth, the incentive to complete a course is much higher in a physical setting. There are huge attrition rates for MOOC's, sometimes topping 90% in each class (Brinton et al, NYT ed). A 2011 study of Washington students similarly found that a higher percentage of students dropped out of college entirely when they took more online classes (NYT ed). This is due to several reasons; lower costs might incentivize people to drop more courses if they get too difficult, the use of a computer might be far more distracting than a normal classroom, students who join online might already be under-performing and never get proper teacher engagement, physical involvement (such as living in dorms and attending lectures) might make normal students place more value in their education, and normal colleges have far more resources (and motivation) to prevent students from dropping classes. Either way, online universities' can't compete with the success of traditional schools.

• Finally, the education of traditional schools will likely be valued far higher by employers for years to come, placing great value on obtaining a degree from a physical location.The University of Phoenix has greatly soured the online universities' reputation; with several federal lawsuits and accusations that they prioritized money making and scamming over educational quality, employers have likely been convinced that the education is substandard. For the reasons listed above concerning the resources of traditional colleges, that's likely accurate. I can't quantify exactly how this changes the value of the degree, but I think the internet does a good job for me; Google has pages of forums discussing former student's plights of being unable to use their degrees to obtain jobs. 

     
      The point is that traditional college isn't dying and will continue to offer innumerable degree programs for years to come. Online colleges might appeal to those who can't afford the costs of ordinary college, older people who want to supplement former degrees, those who normally don;t have access to certain courses at their university, and those on strange schedules that require flexible coursework. But this population isn't nearly high enough to wipe out traditional college's willing student body; all it will do is deflect certain sections of prospective students away from them.

Results

      I mentioned earlier that online schools were correcting the unsustainable nature of current colleges; here's where I'll return to that idea. Traditional college is getting progressively more expensive as the years past, far beyond the pace of normal inflation. Having a foil that could offer a way to supplement or completely circumvent the traditional system will place great pressure on universities to reduce their prices to compete. 

      Will this affect the Ivy Leagues and similarly pretentious liberal arts schools? Probably not, because they sell education alongside both name status and a certain intellectual atmosphere, but state universities and lower-regarded schools will have to reduce costs to compete. 
      
      Where will this come from? Likely reduced administration (pushed to automated online formats), less emphasis on specialized housing and university resources, and less physical classes; purely fact-acquisition classes like introductory sociology might be pushed entirely online, freeing up professors to conduct more research. This won't work for all schools though; non-state institutions might go bankrupt under the pressure. This is just normal market fluctuations at work; if they weren't sustainable to begin with, weathering this storm will be nearly impossible. 

      More companies like Starbucks might start offering college course compensation coverage as part of the normal salary (Vrdolyak); with cheaper education, this won't cost them much and will be seen as a valuable benefit to employees. Starbucks itself is doing this likely because it's good PR at a cheap price; their offer only covers online courses anyway. 

      Cheaper education won't necessarily be for the better though; online classes will still be cheaper for the reasons mentioned above. This will mean that more minority and poor students will turn to them for education. Remember that the education is less regarded than a normal degree, so a new education "class" distinction might grow. Where currently there is a gap between the employment options of an Ivy League and non-Ivy League graduate, there will be a further one growing between these and online-educated students. More people will have education access, but the respective worth of their education will decline.

Conclusion       

      
      Online education is interesting because it poses a viable threat to the normal college order. That said, it isn't killing college anytime soon because of the unique attributes normal colleges possess. What will happen in the near future is likely a price war between the two types of schooling, something that will reduce prices across the board but potentially segregate education. All in all, there is definitely good in the rise of online education, but the potential risks will have to be closely monitored in the years to come to prevent the negative effects such a model might produce. 
     

Citations

401(K) 2012. College. Flickr.com. 24 Dec, 2011. Photo. Retrieved from http://bit.ly/1kVK1LI

Brinton et al. Learning about social learning in MOOCs: From statistical analysis to generative model. Princeton University paper with Boston University and Microsoft collaboration. 19 Dec, 2013. Digital. 

Department for Business Innovation and Skills. The Maturing of the MOOC. Sep, 2013. Digital. 

Lawrence OP. University College. Flickr.com. 20 Apr, 2009. Photo. Retrieved from http://bit.ly/1nhx6Z3.

MacEntee, S. college lecture. 18 Nov, 2010. Photo. Retrieved from http://bit.ly/1ugrSBE.

Montecruz Foto. Kumbia et Internet. Flickr.com. 4 Sep, 2012. Photo. Retrieved from http://bit.ly/1sTHHMU 

New York Times Editorial. The Trouble With Online College. New York Times. 18 Feb, 2013. Digital.

Retrieved from http://www.nytimes.com/2013/02/19/opinion/the-trouble-with-online-college.html?_r=1&

Online Education Database. 10 Advantages to Taking Online Classes. 10 Jan, 2012. Digital. Retrieved from http://oedb.org/ilibrarian/10-advantages-to-taking-online-classes/

Tlng~. sunway university college. Flickr.com 18 Nov, 2007. Retrieved from http://bit.ly/WFnkWC

Vrdolyak, H. Starbucks to Offer Employees Online Degrees. The Heartland Institute. 27 Jun, 2014. 
Digital. Retrieved from http://news.heartland.org/newspaper-article/2014/06/27/starbucks-offer-employees-online-college-degrees