Online courses have already become a mainstay of college, and increasingly high school, education. Most colleges offer at least online courses, if not entire degrees. Though the debate about whether online learning is equal to face-to-face learning continues to rage, it has already been settled on a de facto basis. Accredited colleges of all stripes offer online courses, accept online credits and insist that no distinction be made between online and off-line learning on transcripts. What has gone unnoticed, however, is the impact of dramatically easier credit portability on our very definition of a college degree. Once these definitions are challenged, it’s a short jump to questioning the economic and regulatory model underlying a substantial portion of the American higher education system.
The marketplace for online courses is characterized by thousands of providers, whereas the face-to-face market is constrained by geography to only a few. With thousands of providers offering hundreds of courses at varying price points with varying features, students could easily cobble together all or part of a college degree. Further, they could choose to add certain services and decline others that had previously been provided under the umbrella of an institution. In theory, course-level price competition should drive down the price of a course to its marginal cost of delivery. In online education, the marginal cost of delivery is simply the instructional labor required to deliver the course — frequently less than $100 per student per course. This is frequently 10 to 20 times less than what an institution receives in revenue (state support, tuition, fees). Further, colleges often charge more for online courses than for face to face courses! However, such price competition is currently thwarted by an outdated regulatory structure predicated on the institution, rather than the course, being the “unit” of competition and evaluation.
So, what is the “magic college dust” that warrants the high price of a degree as opposed to the much lower combined price of its constituent courses? Is there something more to “college” than a combination of courses? I suspect the answer is “it depends.” I further suspect that the answer is driven more by student expectations than what colleges claim to offer. Lastly, I also suspect that much, though certainly not all, of today’s college degrees, particularly at the two-year level, are an accumulation of courses rather than a larger experience that is greater than the sum of its parts.
For those who want to think further about this, here’s a link to an article that compares higher education to iTunes: