University Course Credits for MOOC Certificates: One Likely Pathway

How will MOOC-based learning aid learners in entering and performing in the workplace?

We may imagine MOOC-based learning to serve as a qualification in two ways: let's call them the (1) certificate, (2) credit routes.

On the first, MOOC aggregations of certificates themselves are offered as significant job qualifications on a par with, or as an accepted substitute for, college and university degrees. I discussed this option in my last post. On the second, the certificates will be accepted for college and university credit, and thus become (like conventional courses) components of degree pathways where degrees serve as qualifications.

Certificates as Qualifications

The first route  - the use of MOOC certificates as qualifications - has been explored with mixed results..

In December 2012 Coursera announced the opening of its Career Services program, according to the Chronicle of Higher Education. Participating firms, which have included Yahoo and Twitter, contract with the MOOC provider for an undisclosed fee to get data on students' performance on Coursera's MOOCs. Both students and Coursera's participating University partners can opt out of the program. Udacity had already announced a similar program.

In 2013 the MOOC provider edX experimented with its own job service, attempting to place its top MOOC students in jobs with similar companies - the leading high-tech firms. Of the more than 800 top performers that edX placed before these firms, only three received interviews and not a single one was offered a job. Following this failed experiment, edX withdrew from the career services arena.

As I recently argued in this blog, this step may have been premature and ill-founded:

The top-tier firms get thousands of applicants from the best university programs in computer science and information systems for every opening. Why would they be interested in experimenting with MOOC learners when they can take their pick of numerous Stanford, MIT and Purdue grads, who have shown the persistence to earn four year degrees, rubbed shoulders with top professors, and networked with other top students who will soon enter the workforce and connect up with hundreds of other hot prospects? 

Meanwhile,  new business start-ups in Silicon Valley, on Massachusetts Route 128, in New York's Silicon Alley and throughout the country hunger for talent. Most organizations will not be able to compete for the top grads of the top-tier university programs. Is it not possible that edX, which is hardly an expert in the employment agency business, simply directed their efforts at the wrong job market.

 New online job placement services appear - almost daily - to link individuals with skills and firms hungry for demonstrated capabilities. How effective MOOC certificates will prove to be as demonstrations of skill remains to be seen.

Certificates as Transfer Credits 

In this post I want to consider whether MOOC certificates are likely to enter into degree pathways - that is, whether colleges and universities are likely, anytime soon, to accept MOOC certificates as transferable credits in their degree pathways.

It will be remembered that by the end of 2012 the American Council on Education, the body responsible for determining the credit-worthiness of college courses, had, as noted in the Chronicle of Higher Education, begun to evaluate some MOOCs as credit-worthy. The Chronicle quite rightly proclaimed this as a major step - it signaled that colleges and universities failing to recognize MOOC-based learning could not base their rejection on grounds of academic quality.

But to date, few academic institutions have been willing to grant transfer credit for MOOC certificates. And it is not hard to see why! These organizations have become increasingly dependent on tuition dollars for their daily operations. They are naturally reluctant to accept MOOC-based credits into their degree pathways if in doing so they have to forego tuition revenues. If their degrees require, let us say, 120 credits,  at an average cost per credit of perhaps $700, plus fees, then transferring in a MOOC in lieu of a four-credit course would cost almost $3,000. Accepting up to four such transfer courses would cost up to $12,000 per student. If a significant fraction of their students were able to avoid these tuition costs, the organization would be financially strained if not bankrupted.

However, the combination of rising tuition and rising unemployment/underemployment for recent college grads, has radically decreased the private rate of return on the investment in college. The well-publicized trillion dollar student debt crisis has brought this economic fact to public awareness. Most families consider tuition costs as economic investments intended to increase future earnings. As the rate of return on this investment declines (or goes into minus territory) families are reconsidering the value of college education.

According to a Moody's Investment report on the credit-worthiness of colleges and universities released in November 2013, 40% faced stagnant or declining tuition revenues.

Anemic tuition revenue growth has spread to a larger share of the higher education industry, infecting public universities for the first time in decades. At this pace, tuition-dependent colleges and universities will be challenged to make necessary investments in personnel, programs, and facilities to remain competitive over the longer term," said Karen Kedem, a Moody's senior analyst and author of the report.

Moody's key findings include net tuition revenue declines at a projected 28% of public and 19% of private universities, with net tuition revenue growth below inflation projected for 44% of public and 42% of private universities and total enrollment declines at nearly half of public and private universities.

In addition, federal budget negotiations, the reauthorization of the Higher Education Act, and performance-based funding may result in further stress on colleges if student aid and loan programs are curtailed to any degree, given that a rising share of students are dependent on these funding sources, says Moody's.     

While many colleges and universities will continue to demand that their matriculated students earn - and pay for - their credits internally, others will now be hungry for any and all tuition dollars they can get. Some, faced with declining enrollments, will welcome students offering MOOC certificates - like other life experiences - for credit. Others will see the transfer of MOOC credits, paradoxically, as a profit opportunity.

Consider the recent decision by Ashford University to accept MOOC certificates for credit!

Ashford University is a for-profit academic organization owned by Bridgepoint Education, with a campus in Clinton Iowa and a large and profitable on-line degree operation. The university recently agreed, according to the Chronicle of Higher Education, to accept certain ACE approved MOOCs from Coursera and Udacity, for transfer credit.

Ashford University depends for its tuition revenues largely on students with federally guaranteed student loans.Relatively few of its students complete their degree programs. According to Wikipedia, "as for-profit colleges have come under increasing scrutiny, a U.S. Senate report in 2011 listed Ashford's parent company, Bridgepoint, as having one of the highest withdrawal rates of any publicly traded school in the industry." Senator Tom Harkin of Iowa has said of Ashford  "I think this is a scam, an absolute scam."   

Nonetheless, Ashford is on to something! According to its website, "The mission of Ashford University is to provide accessible, affordable, innovative, high-quality learning opportunities and degree programs." Let's first focus on "affordable". Ashford's website states prominently that students can transfer in up to 90 credits. That is a generous transfer policy. On the face of it, the policy implies that Ashford is willing to forego tuition revenues for these 90 credits. But consider that that leaves 30 or more credits in the degree pathway - credits for which Ashford can collect tuition revenues. That is very likely 30 credits worth of tuition that the university would not, without its generous transfer policy, otherwise hope to collect. 

Turning to "accessible," more than 95% of Ashford's students are enrolled in its anywhere/anytime on-line degree programs consisting of high margin, readily scalable on-line courses. Students will be paying tuition for courses  with low marginal costs per student. That generous transfer policy, with its embrace of MOOC certificates for credit, looks like a pretty good deal for the university. 

And it might also be an attractive deal for many students. Ashford is aggressively defending its policy of accepting ACE-approved MOOC certificates for credit as a boon to students, and its defense makes a lot of sense. "Requiring students to assume debt and repeat course content they have already mastered does not serve the individual student, the future employer, or the community," said Dr. Lori Williams, Ashford University provost. "Our job as an educational institution is to maximize learning and facilitate development for each student. In turn, students are more likely to complete their programs, have greater independence from debt, and ultimately get into the workforce more quickly."

Ashford and its students will hardly be the only ones to find this deal appealing. Remember those "total enrollment declines at nearly half of public and private universities." Why will those universities not follow in Ashford's footsteps and offer generous transfer policies, including transfer of MOOCs?

DO MOOCS EXPLOIT STUDENTS BY COLLECTING DATA FROM THEM?

At NeoAcademic, Professor Richard Landers  complains that MOOCs exploit students by using them to generate data (something that is standard in 'real courses' but also regulated by informed consent).

I find the word "exploit" in this context offensive. Suppose the MOOC leaders say upfront: "We will be asking you some questions and hope to use the data in our research studying XYZ. We hope you will also learn from these exercises. Mooc participants will also collaborate on creating an online archive of games." And then ask you to check a box before participating in the MOOC. I think this is sufficient informed consent.

The providers are offering something and I see no reason why they can't ask for something. No one (at least for now) has to take any MOOC. The university also offers something, and asks anywhere from $500 to $2500 per CREDIT. Most employers now mandate possession of a college degree even for jobs that do not require the capabilities acquired through college (and which can be gained in other ways). And in the U.S. the total student college debt exceeds $1 TRILLION. If we are looking around for something exploitive, why not start with university education.

MOOCs and the Manufactured Crisis of Higher Education

Over at Slate, authors Christian and Calvin Exoo argue that MOOCs represent the entry of large, dominant corporations into the Education space. They paint Coursera, edX and Udacity as emerging giants - controlling education as Big Pharma and Big Oil now dominate their industries. 

The big MOOC firms claim to be responding to the problem of restricted access to higher education. But, the authors claim, the U.S. has no such problem - the MOOC firms are 'manufacturing' the problem through their press releases to blind us from reality. A huge percentage of kids, the authors counter, gain access to some form of higher education. The real problem, the authors state, lies in retention: kids drop out because they are unprepared for college and can't afford tuition. The solution they propose is adding lots of remedial services and extra financial aid around the margins for disadvantaged kids. These two steps could get a huge percentage through college. MOOCs provide neither financial aid or remediation, and hence offer nothing for the "real" crisis. 

Leaving beside edX's non-profit status and its decisive move to open source, and Udacity's apparent exit from the education market to concentrate on corporate training - which leaves only Coursera still standing as a large corporate entity in the MOOC education space, this analysis still seems wrong-headed.  

My response is that it is the authors, and not the MOOC firms, who are manufacturing a crisis.

The real crisis is not that too many kids fail to complete college - but rather that too many kids get forced into college because no other pathways to dignified work exist in our society. If we didn't make college a more or less compulsory job qualification - even for jobs that make no use of college related knowledge or skills - we wouldn't need to push these kids through college in the first place. Then they would not need all of these extra-ordinary measures to graduate.

Suppose we do get these kids through college. They will still be facing both a poor and contracting job market - especially for that fragment that needed even more remedial services and extra tuition help. And those kids would also still be burdened with huge debts, which will cripple them financially for life. These are the real crises, and the authors' solutions completely ignore them.

The real challenge is to envision and implement alternative pathways to the workplace. The promise of MOOCs lies in their providing one element in the educational mix aligned with these new pathways. The authors propose to push these kids through a college education. But the kids and their families only seek college education because it has been made into a compulsory qualification. The kids and their families, however, are being sold a bill of goods. There will be no college-level jobs waiting at the end of the compulsory college education. And the kids will end up deep in debt.

The alternative I envision gets these young people more rapidly into workplaces - as apprentices, interns, or small entrepreneurs - and provides the educational backup they need to progress in their work paths without taking on debt. In such arrangements, MOOCs will find one of their most important educational roles. 

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.