Online program manager

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Online learning offers freedom to progress at your own pace and the convenience to learn when and where it suits you. A student does not have to be on campus for an 45 minute lecture and can study when it suits them. The flexibility that comes with online education seems particularly well suited for life-long learning. [1] While this flexibility and freedom has, over the past 15 years, supported teaching and learning for many students. Some are arguing that platforms challenge academic freedom and intellectual property (IP) rights [2] where knowledge assetization prevails and public knowledge is privatized. [3] Online enrollments have grown substantially, especially after the global shutdown. Convenience and flexibility is not the only explanation for this rapid growth. Universities, facing budget shortfalls, have turned to Online Program Managers, commonly known as OPMs to recruit these students and build online programs . [4] OPMs provide bundled products and services to private and public educational institutions in exchange for a revenue sharing arrangement. Universities have come to rely on these services to recruit new students, design, develop, run online programs and more. [5]

Contents

OPMs are often funded by private equity or venture capital as a for-profit enterprises. A revenue-sharing contract [6] has allowed universities to enter into the online education business and gain market share without the need to build their own platform. [7] Such predatory partnerships incentivise aggressive student recruitment (and revenue collection) [8] while outsourcers core edtech capability in an instution. [9] Until recently, they have also been less subject to government scrutiny. [10]

In the face of scrutiny from educational institutions and regulators and competition in the sector, edtech market analyst Phil Hill said in 2023 that the OPM business model was now "on life support." [11]

History

In the 2010s, OPMs grew substantially as universities saw the financial benefit of students reaching beyond their geographical area while recognising their lack of skills in creating, maintaining, and optimising online courses. Proponents of outsourcing from for-profit companies say it "helps universities save money and makes them more nimble and efficient." Moody's Dennis Gephardt, however, warned that "more and more are cutting closer to the academic core." [12]

For-profit colleges are the progenitors of online program managers. [13] In 1973, San Jose University professor John Sperling, created the Institute of Professional Development (IPD), a company servicing a few colleges. IPD was the predecessor to the University of Phoenix. [14] Fueled by Wall Street investors, for-profit colleges gained increased market share until 2010–2011, but declined in strength afterwards. [15] OPMs increased in number and power during the decline of for-profit colleges, and they were expected to continue growing revenues for several more years. [9] The COVID-19 pandemic accelerated the move of college courses to online format, a trend that is likely to continue. [16] In 2018 and 2020, two former for-profit college companies, Kaplan Higher Education and Zovio, became online program managers. In 2021, two massive open online course (MOOC) developers, Coursera and edX, became part of the for-profit OPM business. [12]

Scrutiny and Consolidation (2018-present)

In 2018, Inside Higher Education published "A Tipping Point for OPM?" which stated that most experts thought a "shakeout" would be occurring among Online Program Managers. [17] Kaplan Higher Education became the OPM for Purdue University Global. Kaplan had previously owned the school.

In 2019, 2U shares dropped more than 50 percent when it lowered its growth expectations. [18] The Century Foundation found that many universities reached bad deals with OPMs and called for the institutions to take more control over their online efforts. [19] The Century Foundation characterised OPMs as 'predatory for-profit actors masquerading' as public universities." [20] MOOCs were also criticised for their low completion rates, typically about 3 percent. [21]

In early 2020, the COVID-19 pandemic forced colleges and universities to quickly move to fully online content, increasing demand for OPM support. OPMs gained even greater scrutiny and criticism. Senators Elizabeth Warren and Sherrod Brown called for five OPMs to disclose the terms of their contracts with colleges and universities to determine whether they were violating laws to safeguard consumers from predatory enrollment practices. [22] The companies mentioned were 2U, Academic Partnerships, Bisk Education, Pearson Learning and Wiley Education Services. [23] In an analysis of 70 schools, the Century Foundation reported that "this growing private control—which is often hidden from public view—is jeopardising the quality of online programs, stripping control from colleges and universities, and putting students at risk of predatory behaviour and abuse at the hands of for-profit companies." [24] Noodle acquired a competitor, HotChalk. [25] Zovio also became the OPM for The University of Arizona Global Campus, after previously owning the school once known as Ashford University.

In 2021, two MOOCS became OPMs. Coursera became a publicly traded corporation valued at about $6 billion. [26] [27] 2U also announced that they would be acquiring edX, "to create an entity that would reach 50 million learners and serve most of the best universities in the United States and the world." The acquisition cost was $800 million. [28] An article in Slate referred to expensive online master's degrees offered by OPMs as higher education's "second biggest scam." [29] Udemy also became a publicly traded corporation. [30] In November 2021, the Wall Street Journal had an expose on 2U and its aggressive marketing tactics. [31]

In 2022, a survey of chief online learning officers found that OPMs weren't "meeting their expectations for marketing and recruitment, even though these are the services the college officials said they needed most." [32]

In 2023, the US Department of Education announced that OPMs would be subject to greater oversight, including audits. Higher education institutions would be required to report details about their agreements with OPMs by May 1, 2023. [10] 2U filed a lawsuit to push back against increased oversight. [33] Pearson left the OPM business and Wiley was preparing to sell. [34]

In November 2023, Academic Partnerships acquired Wiley University Services for $150 million. [35]

Operations

According to the Hechinger Report, "OPMs market the programs, recruit students, counsel them through the admissions process, enrol them, provide the software and tech support needed for the programs to function and even help instructors design online-friendly courses." [36] In return, OPMs are entitled to portions of the revenue. Marketing and advertising are the largest expenses for OPMs. 2U, for example, spends $300-$400 million in marketing and advertising in a single year, and 22 percent of all tuition costs go to "customer acquisition." [37] Coursera spends more than one-third of its revenues on sales and marketing. [38]

In 2019, higher education analyst Kevin Carey stated: "...OPMs are transforming both the economics and the practice of higher learning. They help a growing number of America’s most-lauded colleges provide online degrees—including Harvard, Yale, Georgetown, NYU, UC Berkeley, UNC Chapel Hill, Northwestern, Syracuse, Rice and USC, to name just a few. The schools often omit mention of these companies on their course pages, but OPMs typically take a 60 per cent cut of tuition, sometimes more." [39]

In 2021, Coursera described an emerging strategy called the "consumer flywheel": creating stackable content and credentials from leading brand universities. [40]

The revenue sharing model has been increasingly questioned inside and outside the industry as online learning has matured, and colleges gain more skills in this area, with some seeking a fee-for-service arrangement rather than a revenue sharing model. [41] [42]

Both Phil Hill [43] and HolonIQ [44] have also marked the increase in the fee for service market as universities select unbundled services to supplement their internal capabilities. These services are part of the evolution in the OPM space, known as Online Program Enablement (OPE or OPX).

This evolution will most likely continue in the maturation of the hybrid learning market. [45]

See also

Related Research Articles

The University of Arizona Global Campus is a public online university affiliated with the University of Arizona. The university announced a deal to acquire Ashford University in 2020 and completed the deal in 2023.

<span class="mw-page-title-main">Kaplan, Inc.</span> International educational services company

Kaplan, Inc. is an international educational services company that provides educational and training services to colleges, universities, businesses and individuals around the world. Founded in 1938 by Stanley Kaplan, the company offers a variety of test preparation, certifications, and student support services. The company is headquartered in Fort Lauderdale, Florida, and is a wholly owned subsidiary of Graham Holdings Company.

<span class="mw-page-title-main">National American University</span> University in South Dakota and Georgia

National American University (NAU) is a private for-profit online university. It is owned by National American University Holdings, Inc. (NAUH). In 2018, NAU acquired the assets of Henley-Putnam University and now offers strategic security programs. Most of NAU's academic programs are on the 11-week quarter system and have monthly starts. The school is accredited by the Higher Learning Commission.

John Katzman is an American EdTech pioneer. He has established a number of companies which assist students with their studies and career choices, including Princeton Review, 2U, and Noodle Partners. The last two companies are online program managers (OPMs). Katzman has also authored books on the subject.

<span class="mw-page-title-main">Higher education in the United States</span> Education beyond high school

In the United States, higher education is an optional stage of formal learning following secondary education. It is also referred to as post-secondary education, third-stage, third-level, or tertiary education. It covers stages 5 to 8 on the International ISCED 2011 scale. It is delivered at 3,931 Title IV degree-granting institutions, known as colleges or universities. These may be public or private universities, research universities, liberal arts colleges, community colleges, or for-profit colleges. U.S. higher education is loosely regulated by the government and by several third-party organizations.

HotChalk was an education technology company founded in September 2004. HotChalk ran an online community application designed for grade school teachers, students, and parents. In August 2007, McGraw-Hill partnered with HotChalk to make McGraw-Hill training and certification tools available to HotChalk users. NBC partnered with HotChalk as well to distribute NBC news archives to supplement educational materials.

<span class="mw-page-title-main">Andrew Ng</span> American artificial intelligence researcher

Andrew Yan-Tak Ng is a British-American computer scientist and technology entrepreneur focusing on machine learning and artificial intelligence (AI). Ng was a cofounder and head of Google Brain and was the former Chief Scientist at Baidu, building the company's Artificial Intelligence Group into a team of several thousand people.

<span class="mw-page-title-main">Massive open online course</span> Education service on the web

A massive open online course or an open online course is an online course aimed at unlimited participation and open access via the Web. In addition to traditional course materials, such as filmed lectures, readings, and problem sets, many MOOCs provide interactive courses with user forums or social media discussions to support community interactions among students, professors, and teaching assistants (TAs), as well as immediate feedback to quick quizzes and assignments. MOOCs are a widely researched development in distance education, first introduced in 2008, that emerged as a popular mode of learning in 2012, a year called the "Year of the MOOC".

<span class="mw-page-title-main">Coursera</span> Online education technology company

Coursera Inc. is a for-profit U.S.-based global massive open online course provider founded in 2012 by Stanford University computer science professors Andrew Ng and Daphne Koller. Coursera works with universities and other organizations to offer online courses, certifications, and degrees in a variety of subjects.

edX Online education provider

edX is a US for-profit online education platform owned by 2U since 2021. The platform's main focus is to manage a variety of offerings, including elite brand bootcamps.

<span class="mw-page-title-main">2U (company)</span> American education technology company

2U, Inc. is an American educational technology company that contracts with non-profit colleges and universities to build, deliver and support online degree and non-degree programs. It is also the parent company of edX. On February 12, 2024, 2U announced "there is substantial doubt about its ability to continue as a going concern."

iversity Berlin-based online education platform

Iversity is a Berlin-based online education platform. Since October 2013, iversity has specialised in providing online courses and lectures in higher education, specifically MOOCs. Courses are free and open for anyone to enroll and participate. Many of them are conducted in English or German, but also in other languages. iversity cooperates with individual professors as well as different European universities. Some of the courses were winners of the MOOC Production Fellowship held in early 2013. iversity.org officially launched the MOOC platform online in October 2013 and as of February 2015 has a user base of 600,000 online learners, enrolled in 63 courses offered by 41 partner universities. iversity is the only MOOC platform offering courses with ECTS-integration. iversity has branch offices in Bernau bei Berlin, Germany and Berlin.

For-profit higher education in the United States refers to the commercialization and privatization of American higher education institutions. For-profit colleges have been the most recognizable for-profit institutions, and more recently with online program managers, but commercialization has been a part of US higher education for centuries. Privatization of public institutions has been increasing since at least the 1980s.

In higher education a microdegree, also microcredentials and microcourse, is a qualification focused upon a specified professional or career discipline and typically comprises one or more sources of accelerated educational experiences. Microdegrees are a single manifestation of Competency Based Education (CBE) which seeks to tie credentialing to specific skills sets. Micro-credentials may be completed on-site, online or in a blended format.

MicroMasters programs are a series of online graduate level courses offered by universities through edX that one can take to develop standalone skills for career advancement or earn graduate level credentials.

Purdue University Global, Inc. is a public online university that is separately accredited part of the Purdue University system. It's primary focus is educating working adults.

Trilogy Education Services is a New York City-based technology education company that offers non-credit technology training programs, colloquially known as coding bootcamps, through affiliate universities. In-person courses are held on the affiliate university campus. Revenue from the tuition is shared with the affiliate university.

Guild, formerly known as Guild Education, is a private company headquartered in Denver, Colorado that is employed by Fortune 1000 companies to manage their education assistance benefits. Guild works for corporate employer clients to facilitate direct payment for courses to education provider clients and offers marketing services to the education provider clients.

For-profit colleges, also known as proprietary colleges, are post-secondary schools that rely on investors, and survive by making a profit. They include for-profit vocational and technical schools, career colleges, and predominantly online universities. For-profit colleges have frequently offered career-oriented curricula including culinary arts, business and technology, and health care. These institutions have a long history in the US, and grew rapidly from 1972 to 2009. The growth of for-profit education has been fueled by government funding as well as corporate investment, including private equity.

Academic Partnerships(AP) is a major for-profit online program manager (OPM) owned by Vistria Group, a private equity firm. Established in 2007 by entrepreneur Randy Best, it claims to serve more than 50 colleges and universities, providing technology, marketing services, and student support services to mid-level brands. Because of its early start as an OPM, it has been considered "a pioneer" in the business. APs clients, which are mostly regional public universities, are lower in price than elite colleges, but face significant financial and enrollment challenges. According to Academic Partnerships, the company has served 270,000 students and converted more than 4000 campus-based classes to online courses.

References

  1. ↑ Wood, Jonny. (27 January 2002). "These 3 charts show the global growth in online learning". weforum.org. Retrieved 9 April 2024.
  2. ↑ https://www.ei-ie.org/en/item/28484:behind-the-platforms-safeguarding-intellectual-property-rights-and-academic-freedom-in-higher-education
  3. ↑ https://mitpress.mit.edu/9780262539173/assetization/
  4. ↑ ""The Anatomy of an OPM and a $7.7B Market in 2025"". 13 February 2019. Retrieved 9 April 2024.
  5. ↑ Hamilton, Laura (2024). "The For-Profit Side of Public U: University Contracts with Online Program Managers". Socius: Sociological Research for a Dynamic World. 10. doi: 10.1177/23780231231214952 . Retrieved 9 April 2024.
  6. ↑ Hall, Stephanie (20 January 2023). "Your OPM Isn't a Tech Platform. It's a Marketing Firm". tcf.org. Retrieved 9 April 2024.
  7. ↑ Pelletier, Stephen. "The Evolution of Online Program Management". unbound.upcea.edu. Retrieved 19 December 2020.
  8. ↑ Hamilton, Laura (2024). "The For-Profit Side of Public U: University Contracts with Online Program Managers". Socius: Sociological Research for a Dynamic World. 10. doi: 10.1177/23780231231214952 . Retrieved 9 April 2024.
  9. 1 2 Marcus, Jon (8 January 2021). "More colleges and universities outsource services to for-profit companies". hechingerreport.org. Hechinger Report. Retrieved 15 July 2021.
  10. 1 2 Knott, Katherine. "Oversight Coming for Online Program Providers". www.insidehighered.com. Inside Higher Education. Retrieved 21 February 2023.
  11. ↑ Coffey, Lauren. "OPMs on 'Life Support' in Changing Online Marketplace". www.insidehighered.com. Inside Higher Education. Retrieved 12 October 2023.
  12. 1 2 Marcus, Jon (8 January 2021). "More colleges and universities outsource services to for-profit companies". Hechinger Report. Retrieved 25 January 2021.
  13. ↑ Newton, Derek (7 June 2016). "How Companies Profit Off Education at Nonprofit Schools". www.theatlantic.com. The Atlantic. Retrieved 1 July 2021.
  14. ↑ "AN INTERVIEW: John Sperling" (PDF). www.highereducation.org. Higher Education Policy Institute. Retrieved 12 July 2021.
  15. ↑ Lederman, Doug. "The Incredible Shrinking Higher Ed Industry". www.insidehighered.com. Inside Higher Education. Retrieved 15 July 2021.
  16. ↑ Kim, Joshua. "11 Takeaways From the 2021 CHLOE Report". www.insidehighered.com. Inside Higher Education. Retrieved 15 July 2021.
  17. ↑ McKenzie, Lindsay. "A Tipping Point for OPM". www.insidehighered.com. Inside Higher Education. Retrieved 15 July 2021.
  18. ↑ Millward, Wade Tyler (31 July 2019). "2U Stock Tumbles 54% After Company Lowers Growth Expectations for 2019". edsurge.com. Retrieved August 5, 2019.
  19. ↑ HALL, STEPHANIE; DUDLEY, TAELA (12 September 2019). "Dear Colleges: Take Control of Your Online Courses". tcf.org. The Century Foundation. Retrieved 6 August 2021.
  20. ↑ Busta, Halie. "A look inside public universities' OPM contracts". www.highereddive.com. Higher Ed Dive. Retrieved 30 November 2021.
  21. ↑ Lederman, Doug. "Why MOOCs Didn't Work, in 3 Data Points". www.insidehighered.com. Inside Higher Education. Retrieved 5 September 2021.
  22. ↑ Schwartz, Natalie. "Democratic congressional inquiry targets OPMs". educationdive.com.
  23. ↑ McKenzie, Lindsay. "Key Senators Turn Up Heat on OPMs". insidehighered.com. Retrieved 19 December 2020.
  24. ↑ The Century Foundation (12 September 2019). "TCF Analysis of 70+ University-OPM Contracts Reveals Increasing Risks to Students, Public Education". tcf.org. The Century Foundation. Retrieved 27 October 2020.
  25. ↑ Lederman, Doug. "Noodle Swallows an OPM Competitor". www.insidehighered.com. Inside Higher Education. Retrieved 12 July 2021.
  26. ↑ de León, Riley (31 March 2021). "Coursera closes up 36%, topping $5.9 billion market cap in Wall Street debut". www.cnbc.com. CNBC. Retrieved 3 July 2021.
  27. ↑ Maloney, Edward J.; Kim, Joshua. "Why Is 2U Spending $800 Million to Buy edX?". www.insidehighered.com. Inside Higher Education. Retrieved 3 July 2021.
  28. ↑ Lederman, Doug. "2U, edX to Combine to Create Online Learning Giant". www.insidehighered.com. Inside Higher Education. Retrieved 29 June 2021.
  29. ↑ WEISSMANN, JORDAN (16 July 2021). "Master's Degrees Are the Second Biggest Scam in Higher Education". slate.com. Slate. Retrieved 17 July 2021.
  30. ↑ Agarwal, Shweta (5 October 2021). "Udemy files for Nasdaq IPO as online learning shift fuels revenue growth". seekingalpha.com. Seeking Alpha. Retrieved 7 October 2021.
  31. ↑ Bannon, Lisa; Fuller, Andrea (9 November 2021). "USC Pushed a $115,000 Online Degree. Graduates Got Low Salaries, Huge Debts". Wall Street Journal. Retrieved 10 November 2021.
  32. ↑ Schwartz, Natalie. "Are OPMs meeting college officials' expectations?". www.highereddive.com. Education Dive. Retrieved 10 October 2022.
  33. ↑ Douglas-Gabriel, Danielle. "Online program manager 2U sues Education Dept. over new regulation". Washington Post. Retrieved 10 April 2023.
  34. ↑ Hill, Phil. "Shocking, But Not Shocking: Wiley announces plans to sell its OPM business". onedtech.beehiiv.com. OnEdTech. Retrieved 15 July 2023.
  35. ↑ Coffey, Lauren. "Merger of Online Program Companies Suggests 'Reset' in the Market". www.insidehighered.com. Inside Higher Education. Retrieved 16 December 2023.
  36. ↑ BERMAN, JILLIAN (19 September 2019). "Spotlight swings to for-profit intermediaries that may be driving up the cost of online higher education". hechingerreport.org. Hechinger Report. Retrieved 1 July 2021.
  37. ↑ Kim, Joshua. "Digging Into the 2U Transparency Report". /www.insidehighered.com. Inside Higher Education. Retrieved 3 August 2021.
  38. ↑ "Coursera, Inc 10Q". www.sec.gov. Securities and Exchange Commission. Retrieved 5 September 2021.
  39. ↑ Carey, Kevin. "The Creeping Capitalist Takeover of Higher Education". www.huffpost.com. Huffington Post. Retrieved 15 July 2021.
  40. ↑ Hill, Phil (6 August 2021). "Coursera, 2U, and the Emerging Education Platform Market". philonedtech.com. Phil Hill. Retrieved 5 September 2021.
  41. ↑ "Report Calls Online Program Managers 'Wolves in Sheep's Clothing'". Campus Technology. 12 September 2019. Retrieved 17 November 2019.
  42. ↑ "A Tipping Point for OPM?". Inside Higher Ed. 4 June 2018. Retrieved 17 November 2019.
  43. ↑ Hill, Phil (2021-12-01). "OPM Market Landscape and Dynamics: Fall 2021 updates". PhilOnEdTech. Retrieved 2022-02-24.
  44. ↑ "OPM, meet OPX. New models and the $3.5B+ global online higher education services market". HolonIQ. 2019-09-09. Retrieved 2022-02-24.
  45. ↑ "EdTech Predictions for 2022". TechRound. 2022-01-24. Retrieved 2022-02-24.
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