Online Education Will Pressure Universities to Drop Prices: Blackboard Co-Founders

img_9599One of the first pioneers of online education - Blackboard Co-Founder Michael Chasen – talked a great deal last week about what the future holds for online education and college education overall.

Chasen spoke at the Startup Festival in Montreal, specifically about another startup that is not based upon education, but he still had plenty to talk about regarding education.

He noted that Massive Open Online Courses (MOOCs) are the biggest change in the university education space since colleges started going online more than a decade ago. It also means that more upheaval is to come in college education.

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Chasen told his audience that the changes that are happening in the industry today are like what was happening when he launched Blackboard. That was when universities started to realize that putting class materials and course management online was sensible. Change happened fast in this area, and what what was going to happen as a result of all that change was not always clear. Now that MOOCs are coming online from Coursera, edX and Udemy and others, there is a possibility that there is going to be a lot of changes again in education.

Chasen said that he hears that many regular universities cannot keep up with demand, especially in China. Universities in that country cannot put up enough buildings to put students in them. They are trying to determine how to best serve students that often are many hours away from campus. The benefit of online education is that you can scale very quickly and you do not have to worry about buildings and the costs associated with them. All that most students need to participate is a phone and an Internet connection.

MOOCs may not totally take over the college educatio market. However, they will have a major impact on schools in this way: They will put extreme pressure on colleges to drop prices. Adding competition to the education field will make everyone to be more conscious of costs, and this is a big win for all students. Many young professors and educators are excited about the ability to expand their research and to reach more students. However, some smaller colleges and their publishers are going to feel a financial pinch and they will probably resist the changes.

Chasen added that there will always be a place for the top universities in the country and the world. After all, earning a degree from Harvard or Yale is always going to stand out, but there will be much pressure on lower tier schools to change how they approach students and what they charge them. This will happen even more once accreditation issues start to get worked out – at this point, most MOOCs do not have accreditation and are not for credit, but this is probably going to change in coming years.

This does not mean that we will see students getting online degrees by email in the next few years, or that we will see people getting a degree entirely with free online classes. But there is no doubt, Chasen concluded, that we will begin to see changes in college prices due to the popularity of MOOCs.