What effect will MOOCs have on Higher Ed? Hint: it’s not safe to go back in the water


The “Year of the MOOC” is really over. Now that 2012 is behind us, many seem to be hoping that the hype about MOOCs has faded. The reality of coping with producing new kinds of courseware has set in across many campuses. Coursera — already the grand elder — is holding a partners conference this spring that will attract hundreds. The major MOOC providers already have stakeholders. It is a sign that things are calming down.

Other signs are more tangible. I have heard from presidents who are returning to their comfort zones:

I want to raise the rankings of all my programs to Top 20

Or, the even more popular,

My faculty is too focused on its research to…[insert almost anything not directly related to research]

In fact, the more prestigious  the research program the louder is the sigh of relief that things will quickly return to normal.

The specter of immediate budget cuts has faded, so extreme measures are no longer necessary to guard us from the dangers that seemed to be looming just offshore six months ago.

This year’s reports on the financial health of public and private institutions show that the failure rate has ether plateaued or entered a kind of emotional stasis in which it is possible to believe:

The world will always need [insert the name of any of the 1,000 schools that offer unrealistically discounted tuition to keep its enrollments stable].

Fueled by tuition increases and the benefits of prior cost-cutting, hiring has picked up.  Private donations are also on the rise some places. Long-delayed capital improvement projects have restarted.  Most importantly, faculty members have simply stopped worrying about it.

I’m feeling like Jaws’  Captain Quint warning all the Fourth of July beach-goers,

This shark he swallow you whole.

There are are many more Mayor Vaughns who take at the ups and downs of academic fortunes in stride and look for ways to sooth the worried townsfolk:

…it’s all psychological.  You yell barracuda, everybody says “Huh?  What?” You yell shark, we’ve got a panic on our hands….

I guess we overreacted.  It’s safe to go back in the water.

That’s why Moody’s 2013 outlook report on the future of higher education should be such a shock to the system:

The 2013 outlook for the entire US higher education sector is negative, including the market-leading, research-driven colleges and universities, says Moody’s Investors Service in its annual industry outlook. Previously Moody’s had a stable outlook for these leading institutions and a negative outlook for the rest of the sector since 2009. Moody’s perceives mounting fiscal pressure on all key university revenue sources.

It’s not safe to go back in the water. This shark he swallow you whole:

Even market-leading universities with diversified revenue streams are facing diminished prospects for revenue growth

Almost everyone else will see declining enrollments as prospective students become more price sensitive.  A Huffington Post article reports on a separate survey of 300 colleges and universities that shows a dramatic drop in the number of institutions expecting to see rising revenues.

In addition to concerns about student debt, revenue uncertainties and the public perception of value, Moody’s sees the potential for disruption by technologies like MOOCs. Chaos has not left the scene, and as Moody’s points out, structural changes — whether technology-enabled or not — are necessary in order to survive. Far too few leaders are willing to even discuss what structural changes might look like.

I spoke to a gathering of presidents and provosts about this last week.  Presidents of research universities were noticeable absent, although they sent a few worried deans who see the coming challenges. Presidents are the only ones who can make the scale of changes that are needed, but they must believe in their hearts that “it’s all psychological”

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