News, Views and Careers for All of Higher Education
Nov. 28
If it’s been possible so far to paint a generalized picture of the online student — an adult starting a second career, for example, enrolled in a large institution such as the University of Phoenix — that’s only because the market for distance education hasn’t fully matured. Now, a new report suggests, that process is well underway.
As demand shifts to different age groups and students looking for specific types of programs, the era of “one size fits all” is coming to an end, argues a study by Eduventures, a research firm that provides advice and consulting services to its members in the online higher education market. Most notably, the idea that learning online renders geography irrelevant is challenged by trends in survey data.
Two-thirds of the 2,033 representative survey respondents — all interested in online education over the next several years — preferred to enroll in online programs located in their state, but only 47 percent had done so; the rest were enrolled in institutions located elsewhere. The report points to that finding as a signal that better-tailored programs and improved marketing could exploit a market demand for localized online education that hasn’t entirely been filled. Although Eduventures makes its full reports available only to paying members, charts provided to Inside Higher Ed point to a correlation between living in larger communities and a desire for online providers that are based locally.
The importance of geography is already clear in regulation. As an example, said Richard Garrett, a senior analyst at Eduventures and the author of the report, students in four states (Wisconsin, Nevada, Tennessee and Arizona) trigger “state licensure” even if they enroll in an out-of-state institution. There is also a gap between the expected jurisdiction of online colleges, he said, and the actual enforcement of the regulations.
As a result, it’s often difficult to separate the number of students within a particular state who are enrolled in online programs from those who are enrolled in a particular institution. Arizona, for instance, would register an unusually high enrollment because of the University of Phoenix, which serves students from across the country.
“I think the average school will primarily use online to serve the local population,” Garrett said in an interview.
But how will they serve their students (or their customers)? With a maturing market whose growth continues but at a slower pace, that’s potentially an open question. With competing online providers by definition equally available to prospective students, one possible direction is increasing specialization and tailoring programs to niche demands. Or, as Garrett suggested, colleges could concentrate on serving their local communities. Either way, it’s time to abandon the notion that “there is only one version of online,” he said, and for institutions to adapt their individual missions to craft their “own version of online.”
And while online education develops, the preferences of students are also up for grabs. While the greatest demand for 100-percent online education remains among people in middle age, the report found more growth among “traditional” students aged 18-24 (who make up the lion’s share of all students but only about 10 percent of online learners) and those over 55. At the same time, those who are not immediately receptive to distance education might not have any experience with online learning to begin with, Garrett said.
The following table tracks the preferences of 2,000 prospective postsecondary students for education that is entirely online:
Changes in Demand for Online Learning
|
Age Group |
June 2006 |
September 2007 |
|
18-24 |
8.7% |
10.4% |
|
25-34 |
18.7% |
17.7% |
|
35-44 |
22.4% |
23.5% |
|
45-54 |
24.2% |
23.2% |
|
55-64 |
17.5% |
21.1% |
|
65+ |
8.0% |
9.7% |
A reluctance among potential students to embrace the concept of online education could also come from the way it’s often been marketed: as a convenience to busy adult learners with families and jobs. Much of the growth of online learning comes from people for whom the option is merely their second preference. If institutions start to move away from that definition of themselves, Garrett said, they might become more open to different kinds of students — for example, younger students who have fewer qualms about learning online.
“The online market is diverse; the online student is increasingly diverse,” he said.
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Here is how the NYS Dept. of Education handles it. If a distance ed program registered in another state conducts certain physical activities in the state, then they must be licensed in NYS as well.http://www.highered.nysed.gov/ocue/ded/physprespolicy.html
Thomas, at 10:15 am EST on November 28, 2007
Anyone paying close attention to distance learning enrollments would not need these supposed “insights” to come to the conclusion that distance learning choices tend to be local. A quick look at the source of any institution’s distance learning enrollment would reveal that pattern in a flash.
People tend to chose what’s familiar to them, and local is more familiar that a program in another state or half way around the world. Some of the most venerated, well-established distance learning programs in the world, for example, the University of London’s External Programme, which has been around for a about a century and a half, learned this lesson long ago, and have a network of local providers in far-flung corners of the world teaching U of L curriculum. The University of Phoenix’s success is built on the principle of local provision, which makes distance learning not so distant — in fact, it’s just around the corner.
Richard Hesel, at 11:00 am EST on November 28, 2007
Russell is incorrect. Several states do require universities and colleges that offer national online programs to obtain licensure from those states if students from those states enroll in the online programs. One states that is agressively pursuing schools is Arkansas and as the report indicates, there are others.
Steve, at 11:20 am EST on November 28, 2007
While I understand their business model, I am occasionally amused by Eduventure’s reports on the known – sometimes obvious – massaged to attract clients. We have studied the relative geographical reach of on-ground, blended, and online programs for nearly 20 years, starting with the analysis of the first University of Phoenix fully online cohort to earn a bachelor’s. While we have occasionally been surprised by a finding, I find no support for Eduventure’s implication that anyone ever thought that online programs made geography irrelevant. Even military personnel, studying online overseas, prefer to do so in programs having a campus in our near their home town.
Our own research suggests that readers will soon see Eduventures and other reports moving toward different generalizations. We believe that exclusively online enrollments are losing out to fully blended programs where such are available. By “fully blended” I mean blended within courses with all required courses offered in this format.
Our recommendation is that universities interested in these matters concentrate their efforts on developing and managing fully blended programs and employing geo-targeted regional marketing strategies centering on their campuses. Of course these institutions must be capable of converting the geo-targeted leads effectively. This is the real challenge for most institutions. Sluggish responses to email, web, or phone inquiries with a mailed application packet is a thing of the past, practiced by schools that are already or will soon become marginalized.
Robert Tucker, President at InterEd, Inc., at 12:25 pm EST on November 28, 2007
Thank you for the comments on the report. I would like to offer a couple of clarifications:
1) In response to a recent Dow Lohnes survey, the four states mentioned- Arizona, Nevada, Tennessee and Wisconsin- did assert jurisdiction over out-of-state schools wanting to enroll state residents in a wholly online program. Indeed, there are a small number of clear examples of online schools or online arms of on-ground schools that have secured licensure in one or more of these states on this basis alone.
For example, see p33 of Capella University’s 2006 annual report for a comment on why the school is licensed in Arizona and Wisconsin.
http://media.corporate-ir.net/med...8/189886/CPU1740_2006annual_FULL.pdf
As others have noted, various physical aspects of otherwise online delivery (e.g. on-ground recruitment, face-to-face meetings, in-person assessment) may also trigger state jurisdiction. Indeed, the majority of states currently assert some level of jurisdiction here- although regulation and enforcement are rarely well-aligned.
The point is that, depending on how things play out, state regulation may lay geographical constraints on an enterprise that is notionally unbound by state borders. Our report is attempting to raise awareness of state regulation of out-of-state distance learning. We have heard “horror stories” of out-of-state schools enrolling only a handful of students in state x but being required to obtain licensure in that state. As has often been pointed out on the Inside Higher Ed website, states enjoy significant authority in US higher education. The nature of distance education may merit a more national system, but right now distance learning and state regulation are in tension.
2) With respect, the reader who described the report’s findings as “not news” is missing the point. Most schools with online programs do not have a University of Phoenix-style network of small campus centers to turn the national market into a series of local markets. Phoenix is atypical. Most schools with online programs are based in one or two locations, or in some cases are wholly online. Many schools with online programs are significantly dependent on non-local students, as well as local students. Indeed, recruiting nationally is how some online pioneers got as big as they are today.
The argument the report is making is that as the bulk of universities and colleges gradually move online, most schools will use online delivery to serve existing, often local markets in new ways. Excepting very niche online programs, most schools will not see much merit in strongly targeting the national market, not least because they will bump up against pretty similar programs offered locally or offered by the large, more national providers.
The mainstreaming of online delivery means that what was once a substantially national online market (when online programs were more unusual) is becoming a much more fragmented market. There are certainly many programs and schools where the national market makes sense, and a significant minority of prospective students who say they would not privilege a local school, but more choice of online programs locally raises questions for schools that want/need to recruit nationally. As our report notes, there are many rationales more nationally-oriented online schools can use to downplay the supposed value of local online study. It is not a question of “the future of online is local", but rather that the mainstreaming of online delivery means that schools active in the online market need to think about geography as a different kind of variable, whether they see online as a matter of local, national or niche recruitment, or some combination.
I don’t think that the article made clear that the report is in fact eleven separate reports, breaking the country into eight regions, plus prospective student survey data.
Richard Garrett, at 1:06 pm EST on November 28, 2007
I did not give any indication that there were no states that had regulations related to out-of-state licensure; only that none to my knowledge literally prevented a resident from enrolling at will, nor, by law can they do so. Furthermore, the Commerce Clause of the U.S. Constitution will likely preclude the states from overly restricting access to on-line options. I trust that this clarifies the matter for you.
Russell, at 12:30 pm EST on November 28, 2007
The Commerce Clause of the U.S. Constitution will likely preclude the states from overly restricting access to on-line options in 2008 year. Let’s wait and shall see to what it will result.
Proflogistics, at 4:15 am EST on November 29, 2007
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Regulation of distance education
The perceived relationship between location and enrollment in on-line or distance education is an interesting notion, but I would welcome clarification of the statement: “The importance of geography is already clear in regulation.” Furthermore, what does Richard Garrett mean when he states that “... students in four states (Wisconsin, Nevada, Tennessee and Arizona) trigger ‘state licensure’ even if they enroll in an out-of-state institution.”
The practical and legal implications of state oversight of institutions chartered out-of-state reflects very unsettled ground. If we are suggesting that state regulations are clear — including the regulations in some of the states Mr. Garrett cites specifically — we would be overstating the facts. To my knowledge, no state agency would presume to deny a resident of that state the prerogative to enroll in any institution he or she chooses, whether or not that institution is licensed. Furthermore, no state agency is in a position to block access to on-line education, although I am convinced that there are some who would do so in a heartbeat if the opportunity presented itself. My understanding of the matter leads me to suggest that licensure is not triggered by where students live or enroll, but by specific dimensions of institutional operations within a given jurisdiction.
Russell, at 8:55 am EST on November 28, 2007