Student Recruitment as MOOC Business Model

The University of London has recently declared its MOOC business model a success. Is it really?

The University has offered 4 MOOCs to an unlimited number of students, and attracted 210,000 people from 160 countries. 

Barney Grainger, acadaemic project manager for University of London International Programmes, says: ". . .  we have received, at this point, 45 expressions of interest in our degree courses from students who have taken one of our MOOCs."

He adds: "The fact that there is a conversion from MOOC learning to seeking full degrees would indicate that our outlay on these MOOCs has, in fact, been justified. Our learning journey has commenced, and the MOOC business model can work," Grainger says.

 Let's see: 45 out of 210,000 = .000214, or 2.1 per 10,000. And we are only talking about leads, not conversions. No magazine subscription or mail order catalog campaign would call that rate of response a success.

But what is a success in MOOCville?

Let's first consider the Georgia Tech model, where the all MOOC masters degree program in computer science costs $7,000. 45 actual students (not 'requests for information) would generate $315,000 in revenues. Not much, but the marginal cost of the next student = $0. So much depends on scale-up.

Suppose instead these prospective students enroll in costly F2F on-campus programs with fixed costs already sunk, thus adding little marginal cost per student. According to one source, the average cost of a masters degree ranges from $28K to $38K. Taking the mean, those 45 students would now generate almost $1.5M.

What about the costs?

The cost of funding a dedicated University MOOC production studio has run upwards of $1M. And schools are now hiring MOOC production managers. The new one at Boston University, Romy Ruukel, came direct from edX after a decade at Harvard's Project Zero, so she didn't come cheap.

But some schools have made do with their own personnel and available production equipment valued at less than $2,500.

And then, there are the dedicated course production costs to consider. Talking head MOOCs aren't going to generate many requests for information about degree opportunities. Production values will have to be high - and that is costly.

Whatever the costs, once invested by an institution its MOOC production can be scaled up. A studio and production team that produces 4 MOOCs could produce 40. Universities carefully selecting their 'flagship' programs and adding a lot of sizzle could improve the rate of response. (A successful consulting practice could be built on the mail-order marketing model to assist universities in managing their MOOC-based marketing campaigns).

We will need a lot more information on rates of response and conversions, and total revenue from conversions, before we can assess student recruitment as a MOOC business model. But as the MOOC space expands and competition heats up, such information will probably be very closely held.

MOOCs and the Two Cultures of Educational Reform

Stanley Fish writes in the New York Times of the "Two Cultures of Educational Reform." Citing Derek Bok,
former Harvard president, Fish identifies these as follows: 

The first “is an evidence-based approach to education … rooted in the belief that one can best advance teaching and learning by measuring student progress and testing experimental efforts to increase it.” The second “rests on a conviction that effective teaching is an art which one can improve over time through personal experience and intuition without any need for data-driven reforms imposed from above.”

Fish correctly notes that in the current conversation about educational reform the quantitative side of this debate is winning. And he associates the emergence of MOOCs with this trend. Certainly the pronouncements of edX's Agarwal and Udacity's Thrun support this association - they claim - with unmeasured arrogance - to be searching for - and even finding - the "magic formula" for education. Fish replies that no one really knows how to measure the educational values inherent in higher education - and thus that the quantitative side of this divide rests for now entirely on empty promises.

Fish closes with this meditation:

Daphne Koller, a co-founder of Coursera, argues . . . that with the help of the digital media, “we can release ourselves from the shackles that we have gotten used to in the context of in-class teaching.” This turns out to mean that we can be released from the distracting bother of interacting with actual people. 

What does all of this have to do with MOOCs?

Not very much. The allure of MOOCs does not derive from their demonstrably superior pedagogies - and their problems don't stem from their demonstrable pedagogical limits. Thus all of the discussion of what is gained and lost by learning from MOOCs as opposed to live teachers in largely irrelevant.

The problem that has brought MOOCs to the forefront is two-fold: (1) the use of the college degree as a job filter regardless of the actual knowledge and skill requirements of the job, and (2) college tuition outstripping middle class ability to pay.

The ultimate promise of MOOCs is a free equivalent to a college diploma. This will not require high quality education. And significantly, it will not even require credits and degrees for MOOCs. It requires no more than employers accepting aggregations of MOOC certificates - among other achievements -  in lieu of the diploma. 

The reason the diploma has been used as a filter is that it is a very cheap way for employers to reduce their transaction costs (search and assessment) in hiring. As we move in the direction of universal higher education the diploma is failing as a filter. As a simple matter of logic, as more students graduate from college the diploma becomes less differentiating. Employers will need new, more discriminating filters.

This brings us to the current situation. The new global network occupational system is gravitating from full time jobs with benefits to contingent work for even professional knowledge workers. These "free lance nation" types can get in there, do the job efficiently, and leave - without encumbering employers with benefit packages. Thus employers are more focused on finding specific capabilities than the general levels of knowledge associated with diplomas.

And with new search capabilities, they can find what they are looking for. Meanwhile, job candidates can develop searchable digital portfolios, demonstrate their capabilities, and be found through online search. MOOC certificates will fine tune their educational credentials for employers, and thus reduce employer transaction costs more than diplomas.

These are the emerging dynamics of the market for post-secondary education. The other strands in the MOOC conversation, about "poetry," "teaching as an art," "magic formulas," "measurable learning objectives" and Daphne Koller's Brave New World, are side shows.  

MOOC Developments in June 2013 - Globalization + NGO Partnerships

Welcome to Moocville Blog.

I will be offering periodic reports on major developments in the world of MOOCs. Today I want to talk about two such developments in June 2013.

 



 The first is the globalization of the MOOC phenomenon. MOOCS have been associated in the public mind with the large US platforms: edX, Coursera and Edacity in particular. Indeed, many commentators have claimed that MOOCs are an effort by US educational entrepreneurs to dominate the future of higher education globally. Well if that was ever the intent, no such luck!

MOOCs are growing in all regions of the world. Examples include Verduca in Latin America, iversity in (Europe) Germany, Schoo in Japan, WorldWideEd in Canada, and others in Australia and elsewhere.

 The MOOC phenomeonon is now entirely global and spreading. By the end of next year MOOCs will be as familiar to knowledge seekers as universities are today. Many millions of learners will have had some experience with MOOCs, and they will spread the world. The positives and negatives of the MOOC experience will become clear, and the MOOC platforms will respond with better MOOCs.

 The big question is where will higher education move from there. How will other institutions adjust to this change in education?

 One possible answer is found in my second story, the recent partnership of edX with the IMF. Like many NGOs, the IMF is a producer of high quality courseware for their employees and members. IMF courses on International Finance have been enjoyed by central bankers and policy makers in IMF member states.

Now many of these courses will be available free to the general public. In 2013 a few of these courses will be available on the edX platform. By next year, several of them will be available for free to anyone seeking training in International banking. If that floats your boat, these may be just the thing you were looking for.

 The importance of this development should be clear. The boundary between higher education organizations and NGOs is beginning to blur. Of course the IMF doesn't offer an MBA and their courses are not for university credit. Most members of their current audience are chuck full if university diplomas.

 But the IMF, like so many other NGOs, is a storehouse of information products which can be re-purposed as courseware. So when higher education aggregator organizations emerge, as they are certain to, they will without doubt be packaging these NGO courses along with MOOCs from University sponsors to create degree -equivalent qualifications.

 Why would employers pay any attention to these? Well, the diploma is used as a job filter to lower transaction costs. The degree equivalent qualification will serve the same purpose, and maybe better. Tell me, Mr. employer, would you prefer a qualification backed by 30 or 40 MOOC certificates from the world's leading universities, or a diploma from Pugwash State U? Which one will display more initiative, self-direction, and cutting edge knowledge?