The Specialists

Is the “bundled” model of higher education outdated?

Some higher-ed futurists think so. Choosing the academic program at a single university, they say, is a relic of a time before online education made it possible for a student in Oregon to take courses at a university in Florida if she wants.

April 5, 2010

Is the “bundled” model of higher education outdated?

Some higher-ed futurists think so. Choosing the academic program at a single university, they say, is a relic of a time before online education made it possible for a student in Oregon to take courses at a university in Florida if she wants.

Since the online-education boom, the notion that students could cobble together a curriculum that includes courses designed and delivered by a variety of different institutions — including for-profit ones — has gained traction in some circles. “As it has with industries from music to news, the logic of digital technology will compel institutions to specialize and collaborate, find economies of scale and avoid duplications,” journalist Anya Kamenetz wrote last week in an op-ed. “Excellent [course] content,” noted the author and higher-ed innovator Peter Smith in an interview earlier this month, “is increasingly commodified and available.” Leaders in the liberal arts community recently nodded at the idea that even small colleges could soon teach from open courseware “modules.”

Much of the talk about this imminent unbundling has come from colleges that predict that students might want to transfer credits from other colleges that might have different missions. But the competition may also come from entities that do not even offer degrees.

Consider, a company that teaches a swath of online statistics courses to mostly adult learners. In eight years, has grown its menu from a half-dozen professional-development classes to more than 80 courses designed and administered by top statisticians, many of them professors at leading universities. It enrolls about 2,500 students per year. And although the company caters primarily to the professional-development crowd, says it is now looking to grow its introductory offerings in a way that could compete with “any university, whether online or brick-and-mortar, that is going after the nontraditional student market,” according to Peter Bruce, its founder and president. has an all-star faculty — a mix of academics and private-sector statisticians, many of whom have authored popular statistics textbooks — who design courses, write tests, and are periodically available to students to answer questions.

While each course is significantly shorter than a typical course within a degree program, the company identifies a sequence of low-level courses that is roughly equivalent to a semester-and-a-half’s worth of introductory statistics, according to Bruce. Students are assigned weekly problem sets and take an examination at the conclusion of the course.

For the last three years, the company has had the stamp of approval of the American Council on Education, which advises its 1,614 members on which institutions they can feel comfortable accepting transfer credits from. The council says that it has never heard of a college refusing to accept credits earned in courses. Granted, the council has only documented 38 requests in that time. But that number could grow once revamps its introductory courses.

As part of that new focus, the company says it plans to bring its novice courses into neater alignment with the American Statistical Association's Guidelines for Assessment and Instruction in Statistics Education. It is also looking to develop an introductory textbook in-house, which it hopes to make available to students for free, says Bruce.

The company outsources grading and other work to master’s degree-holders in India for much less than it would cost to employ similarly qualified teaching assistants in the United States. The company says the salaries it pays its employees in India are variable and would not disclose specific figures, saying only that its wages are competitive. It would also not disclose how much it pays the professors who design and teach its courses, although two instructors contacted by Inside Higher Ed said they are paid about $1,800 for each course. Courses typically last between three and five weeks, and cost students about $500, with a discount for learners who are affiliated with an academic institution.

But Bruce says's educational model is not about minimizing costs as much as maximizing expertise. "Organizations that provide the 'best' online education in a given subject area will come to dominate others," he says. In other words, as technology allows students to pick and choose courses from different institutions, the education providers that thrive will be those that concentrate their resources in particular fields.

"The institutions that dominate in a particular subject area will do so, in part, because they have expertise and experience in that subject area that will give them a leg up on institutions whose orientation is more general," Bruce says. "This view is antithetical to the view that large online institutions can dominate in all arenas by driving down costs."

Traditional institutions, however, have been hesitant to open the door to commercial ventures that sell higher education by the course or program. The faculty at the University of Toledo, in Ohio, managed to kill a deal last year that would have outsourced parts of a master’s program in education to Higher Ed Holdings, which also faced significant pushback from some at Arkansas State University. Almost simultaneously, professors and students at Fort Hays State University rose up against the university’s decision to award credit for courses offered by StraighterLine, a company that offers individual courses to students for a flat fee of $99 per month and an additional $39 per course started.

Skeptics who object to counting credits from courses taken through commercial providers toward degrees at a traditional institution usually do so based on concerns about quality and rigor. But Michelle Everson, a lecturer at the University of Minnesota who also serves as a consultant and an instructor for, says there is, pound for pound, no difference in rigor between’s introductory courses and the ones Minnesota offers as part of its curriculum. She teaches both.

Keith N. Crank, manager of research and graduate education at the American Statistical Association, said it was reasonable to trust the academics employed by, who vouch for the legitimacy of its courses. He added that having statisticians design and administer courses might even result in a higher-quality experience than learning the subfield from mathematicians who are not statistics specialists, as is the case at certain more traditional higher ed programs.

Burck Smith, the founder and CEO of StraighterLine, says that, while the precepts of higher education are difficult to change, he believes the confluence of several economic factors — particularly rising tuition and the unwillingness of many students to take on exorbitant debt, especially as they see their degree-holding peers struggling to land jobs — may force institutions to consider turning to outside specialists if they want to continue offering certain courses.

And if they don’t, Smith says, students will likely turn to the outside specialists themselves.


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