A funny thing started happening in the face of rising education costs and a looming student debt bubble: massive open online courses (MOOCs). Offered by universities everywhere from Stanford to University of Washington, the model has the potential to upend the traditional education model. While open online courses are certainly revolutionary, their business model remains uncertain.
College education has been considered a luxury. Thousands of classes are taught each day at solid institutions across the world for a relatively high price. With the rise of open online courses, traditional classes may be commoditized. At some point, to compete, these classes will be moved online and can be offered as an open online curriculum, especially when production and technology costs go down. Not only will students be attracted to the cheapest option, there is a general ethos that education should be free. While companies like Coursera may take their time to figure out a monetization strategy, this is also time where outside parties will further evolve or disrupt the space.
One way to stand out it to produce excellent content. Simply videotaping a college lecture and posting it online with supplementary questions does not fundamentally change how we learn today, though it does make it more accessible. But imagine if a professor worked on creating a dynamic and engaging video, or had someone with excellent communications skills deliver the lecture. After viewing a 10 minute video clip that covers a concept, the student is then asked to answer questions, which if he gets wrong, prompts the correct answer. Innovation isn’t simply putting a lecture online, its evolving how lectures and education can be delivered.
Companies offering MOOCs must also think about how completing these courses can provide an immediate benefit to the student. This strategy is what will encourage students to pay. I can envision a certified online profile showcasing all the courses/skills someone has completed, perhaps on LinkedIn. Employers can see these skills, and even delve into the specific topics this person has learned, and assess how well they mastered these topics through tests. What if these courses were tailored to move beyond academics, connecting knowledge learned to job skills? What if supply and demand pricing was tied to a case study on how an online business adjusted price to optimize revenue? If a prospective employee took a course and its content was transparent, the employer might be very interested in him. Moreover, if online universities worked with employers to develop their cirriculum, students would know these classes can translate to opportunities.
Investing in employee growth complements the goals of many companies. It benefits the company through increased knowledge and the fact that many of those employees will want to invest back in the company. If these courses were tailored to professional development, I think many employers would be willing to pay. As a manager, I would purchase a subscription, and want access to see who on my team is completing these courses and what level of mastery they are developing.
Additionally, why not compete with the Kaplan or for-profit schools like the University of Phoenix? Why not get a college degree that’s an amalgamation of college courses taught around the country, tailored to a students specific interests, that cultivates the skills needed to carry the US forward, all at a low cost. But more importantly, why stick to the traditional model of education—its so out of vogue? Entrepreneur Peter Thiel has made the case that a college degree isn’t necessary to create innovation or foster entrepreneurship. MOOCs can enable those entrepreneurs skipping school to acquire the skills they need without delaying entrance into the workforce.