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Why isn’t University free?

by Michael Nielsen on February 25, 2008

How long before a major brand University realizes that they can use their brand to almost instantly build an online audience in the millions, sets tuition to zero, and starts broadcasting (and archiving) every lecture at the highest possible quality, complemented by associated online discussion fora, real life meetup groups so students in a given area can regularly meet and discuss the material, broadcasts into Second Life, and so on? Essentially, build an entire economy of services and community around the basic product such a University already offers – lectures by some of the smartest people in the world.

How would this work out financially? At the moment, if a big brand University has 10,000 students each paying (on average) $20,000 / year to attend, that’s $200 million in revenue. They can make the same revenue with 5 million regular viewers, each worth $40 to advertisers. Given Facebook’s admittedly somewhat ludicruous valuation ($300 / user), that seems a trifle.

There are other difficulties and objections, of course, beyond financial viability:

  • Q: Isn’t one of the main points of University to act as a hub for clever young people to come together? And don’t they need to be together to get the full benefit of lectures and so on? A: Yes, but you could get a large fraction of the benefit by doing local community building like I described above, without the $80k price tag. And since so many more people would be involved the aggregate benefit would be far larger. If it’s really that important, then presumably some people will be willing to pay a premium, and still attend the Harvard (or whoever) lectures.
  • Q: Don’t students need real life interaction with the lecturer? A: This is true, in part. But, again, you can get a lot of the same benefit through well-run discussion forums, both online and offline.
  • Q: Don’t the Professors need the students around to stimulate them? A: Much of the stimulation comes at the grad student level, and at that level, I don’t think this proposal would change much. Harvard (or whoever) would carry on with their graduate program, just as before, since it’s largely based on research, not classes. At the undergrad level there would be a loss.
  • Q: What about exams, accreditation, degrees? A: These could, of course, still be offered, by setting up test centres in major urban areas.
  • Q: Wouldn’t we end up in a world with many fewer Universities? A: Probably, yes. But far more people would get a far higher quality education.

There are some half-hearted steps in this direction: UC Berkeley on YouTube, iTunes University, and Open Courseware are all worthwhile. But they’re tiny steps compared with what could be done.

(This question inspired in part by Chris Anderson).

Update: Someone has criticised my comparison of advertising revenue with Facebooks’ valuation. That’s fine – the two are quite different, and it’s fair to ask for a more direct comparison. Unfortunately, I don’t have a good sense of the numbers here. Certainly, most sites make far less than $40 / user per year. But then, I think this site will get a great deal more (monetizable) attention from its users than your average internet site.

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10 Comments
  1. Travis permalink

    That sounds like a great plan. I think you should call it “the Democratization of Higher Education,” for the slightly cynical reason that it is in vogue to abuse the word “democratization” in such a manner. By doing so, you may bring on board a few of the people who would otherwise be suspicious. After all, who can be opposed to democracy?

    More seriously, I think that your proposal would do a great deal to improve education. With course material laid bare for public inspection, it would be much easier to assess the actual quality of instruction at various institutions. Competition is a great thing.

    In the long run, this plan might reduce our obsession with credentials. If everyone could educate themselves online, we wouldn’t be able to assume that only those with degrees were educated. Another bonus…

  2. There are already sites like chinesepod.com and spanishpod.com that do this in the languages, and teach their materials more effectively than most universities. I’m sure there are other examples in other fields as well.

    Open source projects offer a way to get a practical education in CS as well, provided you pick the right ones.

  3. agm permalink

    Wow, what a bad idea (at least in the US; I understand things are done very differently in other countries). The bulk of funding does not come from student tuition for many institutions, there’s no way you could convince the taxpayer to do support, so that it would effectively shutter many schools. Education is acknowledged socially as a public good, but as soon as money is on the line, it becomes about preventing the degredation of “my child’s education”, since not catering to those kids as much in order to spend the money to improve other students’ education.

    I admit, this is very bleak and pessimistic, but I’d rather not see these people waste so much time and energy on something that won’t work [won’t work politically, I mean]. Burning out the people actually willing to work to make a change in a futile effort is usually a bad idea. Plus, in the inimitable American idiom, we’d only get that much more bureaucracy out of it somehow.

  4. Travis permalink

    @agm,

    Schools like Harvard and Yale have huge endowments and could afford to do this, with or without government support. As for government support, I think there’s an even better argument for subsidizing free-for-all education than for subsidizing the education of a “privileged few”. Lots of parents would be very happy with a system that somehow gets their child associated with the Harvard “brand”, even if it was only online.

    Public schools like UC Berkeley actually do receive a large percentage of their funding from tuition (research is the largest chunk, followed closely by tuition, with state funding far behind).

    As for the second tier schools, they’d have to compete or die. So what? My hunch is that some of them are actually better in terms of educational quality, and I think they’d have a good shot at thriving.

  5. University WAS free (in my countries) back in the 1980s when I was an undergrad – and the government would give a living allowance to some people. But the baby boomers decided to keep everything for themselves, and f$%##$ their own children, so now students go into debt to pay the exorbitant fees.

  6. Robin Blume-Kohout permalink

    Economically, I think what you’re proposing is for a university to shift itself from one end of the supply-demand curve (restricted supply => high price => profit) to the other (low price => many units sold => profit). This probably makes sense for some university, but I question whether it makes sense for a major brand (e.g. Harvard).

    Harvard derives a great deal of prestige and profit from their exclusivity — and from the fact that the world perceives a Harvard degree as a potent guarantee of excellence. Extending their brand to the masses would negate both. In automobiles, Jaguar has a similar situation — much of the demand for their mechanically sub-par product is fueled by exclusivity. DeBeers is another example.

    So, I suspect that somebody will do this — but, if you work through the game theory, I wonder how far down the rankings you have to go before you find a school for which it’s the rational strategy?

  7. Michael Nielsen permalink

    Robin, your analysis is very close to a classic pattern, which Dan Christensen calls “The Innovator’s Dilemma” (great book). Christensen’s analysis is too detailed to explain here; we should have lunch soon and talk about it.

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