Chapter Two: New Beginnings
With anger or amusement (or both),
many in the campus community will recall management sage Peter Drucker's dire
predictions for traditional higher education. Interviewed by Forbes magazine
in March 1997, Drucker proclaimed that "universities won't survive
education is in deep crisis
the college campus won't survive as a residential
today's [campus] buildings are hopelessly unsuited and totally
Drucker offered this assessment during that long ago era now referred to as
the "Internet bubble." Education was a hot topic in the dotcom economy. Financial
analysts wrote compelling reports while their investment firms convened packed
conferences, all focused on online education in the new information economy.
Each week seemed to bring a new press releaseand an accompanying SEC filingfrom
yet another new dotcom that was determined to do well and good by providing
better, competitive, and profitable educational programs, resources, and services
on the Web.
Internet entrepreneurs and the venture capitalists funding their ambitious
business plans saw great opportunities in K-12, college, and corporate education.
Financier and philanthropist Michael Milken and former Education Secretary Bill
Bennett were among those who invested their time, talent, money, and reputations
in "dotedu" ventures. The British Open University announced plans to invade
American higher education. The University of Ph'enix launched an online degree
program to supplement its expanding enrollments at multiple locations across
Big plans were fueled by very big bucks. Eduventures (www.eduventures.com)
estimates that from 1995 to 2001, online education companies raised more than
$2 billion, primarily in venture capital but also including some campus seed
money. College presidents and trustees talked privately, and with great concern,
about the threat the dotcoms posed to "traditional" higher education
and to their own institutions. Some saw easy money, others saw serious competitors:
"The train is leaving the station; we here at Old Acme have to do something,
and do it soon."
New York University, Temple University, and the University of Maryland, among
others, launched their own, highly publicized online initiatives. Columbia University
invested more than $25 million to create Fathom, its for-profit foray into Internet
education. California Virtual University, Western Governors University, and
Michigan Virtual University emerged as public sector strategies to serve and
seize the anticipated demand for online courses and degree programs.
And today? The British invasion failed; Fathom has folded. Cal Virtual has
vanished, as have most of the dotcoms that seemed so promising. Gone are the
great aspirations, high hopes, and the billion bucks (maybe more) that fueled
these efforts and initiatives.
And yet, on the horizon, there is evidence that some campus and corporate dotcoms
are experiencing a Ph'enix-like rise from the ashes of their highly publicized
Three-fifths (62.5 percent) of the colleges and universities that participated
in the 2002 Campus Computing Survey offer at least one complete online/Web-based
college course. Peterson's (www.petersons.com)
online directory of distance learning identifies some 1,100 institutionslarge
and small, well-known and less-known, public, private, and for-profitthat provide
online degree programs.
The post-dotcom world of online higher education includes, among others, Azusa
Pacific University (evangelical Christian), Boston University (large private),
Cardean University (online, for-profit), De Anza College (two-year public),
DeVry University (multi-campus, for-profit), Michigan State University (large
public), and eArmyU (U.S. military).
The University of Ph'enix serves some 45,000 adult learners in its online degree
program, placing Ph'enix Online among one of the 10 largest colleges or universities
in the United States. (Another 125,000 adults are enrolled in the "more traditional"
Ph'enix degree programs.)
And it is not just the degree providers who are beginning to do well. Course
management software providers Blackboard, eCollege, and WebCT have found the
path to profits. Other firmssome survivors of the dotcom demiseare gaining
traction, generating revenues, and moving toward profits.
The new and surviving players are smarter and wiser, focusing on the numbers
and nuances of higher education. They spend less on Aeron chairs and allocate
more resources for user support.
For the thousands of adults pursuing degrees in online programs sponsored by
DeVry, Michigan Virtual University, or Ph'enix Online, the Internet may be their
only viable access to higher education. These enrollments represent a net gain
to the system of higher education.
The second coming of Web-based higher education marks the emergence of a new
sector that reflects the "bricks and clicks" détente seen elsewhere in the post-dotcom
Moreover, the surviving and thriving online programs help expand access to
higher education, a key goal of public policy for the last 40 years. Unknowingly
acknowledging the preamble to the historic Higher Education Act of 1965, the
new dotcomspublic, private, and for-profitserve "all who might benefit" from
the opportunity to attend college.
Recalling the words of Mark Twain, let us acknowledge that "word of [the] demise
has been greatly exaggerated." Welcome to Chapter Two, the post-dotcom, new
beginnings of Web-based higher education.
Author’s Note: Some companies cited in this column are also corporate sponsors
of The Campus Computing Project.