Last week, in an article for the Huffington Post, titled Commencement 2.0, I discussed the need for higher education officials to begin substantive planning for digital disruption. The article argued that low-cost high quality online courses combined with sophisticated exam tools and online teaching assistance would inevitably lead to massive dislocation in higher education.
To my surprise, on the same day this article appeared Georgia Tech, one of the nation's leading engineering and computer science schools announced that it would begin offering a low-cost Online Master of Computer Science degree.
The next phase of digital disruption is now here, and I suspect higher education officials are, with few exceptions, not ready.
The total cost of the three-year Georgia Tech program for student is expected to be $7,000, less than 20% of the cost of the $40,000 on-campus instructor led program.
"The Georgia Institute of Technology College of Computing announced today that it will offer the first professional Online Master of Science degree in computer science (OMS CS) that can be earned completely through the "massive online" format. ...
All OMS CS course content will be delivered via the massive open online course (MOOC) format, with enhanced support services for students enrolled in the degree program. Those students also will pay a fraction of the cost of traditional on-campus master's programs; total tuition for the program is initially expected to be below $7,000..."
This isn't academia's first foray into offerings that promise some combination of low cost and high tech education, of course, but it's the first one that industry observers say has the potential to shake up the status quo. "Georgia Tech's announcement probably is a game changer that will have other top-tier universities that offer degrees in computer science scrambling to compete," [said one industry expert quoted by Time]."
As I look at what is happening, I suspect there is one thing I bring to analyzing this landscape that the majority of higher education officials do not: The perspective of someone who has intimately lived the digital disruption of two separate industries, magazines and book publishing. In addition, I have been studying the patterns of how digital disruption happens since my initial involvement in Web innovations over 15 years ago.
From this viewpoint, I strongly suggest that higher education officials must develop an immediate sense of urgency. Here's why:
First, there is a clear pattern to the digital disruption of industries: Change happens slowly and then quickly. The massive shift to ebooks, is one example: about a year after the launch of the Kindle, change in consumer behavior occurred at a pace that far exceeded anyone's expectations.
The Georgia Tech announcement is, in my view, the kick-off of a similar cycle of rapid change. I expect that by the end of the summer at least five other well-regarded institutions will have announced similar initiatives across different fields of study. Within a year, the total will exceed 30 such institutions, and within two years, online offerings from well-regarded institutions will be an established alternative to traditional degree programs.
Second, rapid change begins in the easiest niche and then flows outward. It's happening here. Indeed, it's far easier to offer an online degree in computer science than in English literature.
Third, the pace and magnitude of change is driven by the benefits available to consumers. In this case, the benefits are potentially extraordinary. A recent released Harris Interactive survey of student loan borrowers and their parents found that " 75 percent, said they or their children have made personal or financial sacrifices because of monthly student loan payments," with recent graduates postponing marriage, buying a car, and buying a home. Moreover, student loan interest rates willdouble on July 1st without Congressional action.
Prospective college and graduate students are increasingly aware of the financial burden associated with traditional higher education. They also see the impact of the debt incurred to finance this education on today's now unemployed or under-employed (i.e. restaurant or retail worker) recent college graduates.
Is it realistic to doubt that prospective students, and their economically stressed post 2008 middle class parents will consider the benefits of dramatically lower alternatives? And, as online offerings increase in sophistication, will higher education officials be able to convincingly argue that their product is so superior it is worth this lifetime financial sacrifice?
Fourth, at the start of digital disruption new companies often partner with existing content providers to perfect their business model. Then, these companies morph from valued friend to threat as well. Amazon started out as a boon to booksellers. Now, it is both a distribution outlet for these same publishers, but increasingly a threat to their businesses as a publisher in itself, a platform for self-publishing, and a potential price disruptor (by offering new books far below suggested retail prices, ebooks at low costs, and perhaps even pricing publisher's products as loss leaders).
Today, Coursera has partnered with over 60 leading colleges and universities, including some outside the United States. I have no doubt that a few years from now these same universities will view Coursera, or its progeny, as both friend and foe.
Fifth, digital disruptors often cherry pick the most profitable products of traditional entities. Large lecture courses (with very high faculty to student ratios) effectively subsidize more expensive aspects of a college education. They are ideally suited to online offerings, and will be among the first to be offered by a well accredited institution.
Finally, denial is inevitable. Book publishers never believed people would read on a screen. Newspapers believed that consumers would never be satisfied with a few sources of commoditized news content. Similarly, I suspect the vast majority of university and college officials believe that, despite the economics associated with their product, prospective students will never forgo the live experience for an online alternative. They are wrong.
This coming dislocation may be a boon for students but our society, as well as the higher education world, will face dramatic challenges. They include:
- The economic viability of many existing higher education institutions will be threatened.
- As economics start to drive educational choices, will we reinforce the economic inequality that already plagues our society? If online courses are seen as valued, but on-campus education is viewed as superior, will we return to a pre-GI bill society, where an on-campus education is the province of the wealthy?
- Our social fabric is, in part, built on the idea that a large portion of 18 year-old's leave home college. What happens if there is a sudden, large shift to young adults staying at home to pursue online courses?
Our society has been here before. The pain in the retail, music, newspaper, magazine and book industries is ongoing. And our nation is far poorer for the many former employees in these industries who have never regained their former ability to provide for their families or contribute to our nation's prosperity.
The essence of a good education is, to a large extent, the ability to recognize an important issue in a particular field of study, analyze a problem if it exists, and determine the best course of action. Let's hope that our well-educated leaders at institutions of higher education are themselves able to learn from history, and not repeat it.