The New York Times - The Nontraditionalists; A Different Course

The New York Times - The Nontraditionalists; A Different Course

By John Schwartz
John Schwartz covers technology for The Times.

You've seen the ads on billboards and the bus. They make the process of getting a degree online look almost cozy: earn an M.B.A. in your pajamas and fuzzy slippers. The reality is a little, well, blearier.

Take Frank Grande Jr., who is working on a business degree from the University of Massachusetts from his home in White Plains. His day begins at 6 a.m. with an hour commute from suburban New York to his job as a stock trader in New Jersey, where working the market from 9:30 to 4 leaves most people drained. "It's not something for the faint of heart," he says. He commutes another hour to get home -- two, if traffic is bad.

His wife, Alicia, places broadcast advertising from home while taking care of their two children. Alicia and Frank don't see much of each other, and Mr. Grande can't help around the house as much as he did before going for the degree. "But she understands," he says. "She knows it's something I really want to do."

One recent evening he comes home to find Jakey-Boy, his 3-year-old, there to greet him. Jake informs his father that he has wet his pants. Once that crisis is resolved and the children on their way to bed, Mr. Grande is left to study. He heads upstairs, opening a baby gate and sidestepping a squeezy toy along the way. School is in session -- "if I don't fall asleep on the couch first."

Students like Frank Grande are, virtually, everywhere, whether taking courses entirely online, as he does from UMass, or at campuses of for-profit companies like DeVry Inc. or the Apollo Group, which owns the University of Phoenix.

Today, 1 in 12 college students attends a for-profit institution, and the business has grown to $23 billion in annual revenue for 2002, the latest year analyzed by Eduventures, an education market research company in Boston. The University of Phoenix alone has about 201,000 full-time adult students at 142 campuses and learning centers. Enrollment in for-profit institutions is growing at three times the rate of nonprofit colleges and universities, says Sean Gallagher, an analyst with Eduventures.

A big part of that growth is in online education. "Each time we update our forecasts, we find that the online education market is growing a little bit larger than we anticipated," Mr. Gallagher says.

According to a study last year by the Sloan Consortium, a nonprofit association whose mission is to improve online education, more than 1.6 million students took online courses in 2002; nearly 600,000 of them took all their classes in cyberspace. More than a third of higher education institutions offer online courses, and 97 percent of public universities do.

The education market didn't always look so rosy. Not that long ago, traditional colleges came to envision nontraditional education as a potential cash cow. Prominent universities like New York University and Temple rushed in with the creation of for-profit subsidiaries that promised to blend ivory-tower class and dot-com nimbleness. But by 2001, most of those highly touted experiments had failed. Columbia's for-profit program, Fathom, which offered online courses in partnership with institutions like the University of Michigan and the University of Chicago, folded early last year. Less grand online programs continue.

What went wrong? For one, new courses proved far more expensive to develop and run than anticipated. And the if-you-build-it-they-will-come sensibility of the dot-com years was as ill suited for higher education as it was for most businesses. Jared Bleak, who has studied the for-profit education market as a postdoctoral researcher at Harvard, says that the earlier failures came from a fatal disconnect between the educational mission of the traditional universities and the entrepreneurial notion of ginning up a quick for-profit business that could provide an entirely new endowment.

"It's really a cultural conflict at the core," he says. They also fizzled, says Carol A. Twigg, executive director of the Center for Academic Transformation at Rensselaer Polytechnic Institute, because "there was no where to begin with."

In fact, online programs at traditional universities like UMass and the University of Maryland University College, which had built organically on existing distance-learning programs, were quietly booming as nonprofit ventures.

ONE of the classic mistakes that a company makes as it feels its way into a new business is a failure to fundamentally rethink content and process -- in this case, course material being put online. Adult learners want their education quick and to the point. Successful programs offer a kind of education that might strike some as downmarket.

"We're meeting their needs," says Jack M. Wilson, president of the University of Massachusetts. "We're not trying to force them into a model." Enrollment at UMassOnline grew 32 percent in the fiscal year that ends June 31; its estimated 15,000 online students bring in nearly $13 million for the university.

For-profit companies have similar success stories to tell, thanks in no small part to a weak economy that drives workers back to school to upgrade skills and credentials. For instance, Strayer University, which began 112 years ago as a business college in Baltimore, now serves students online and on 27 campuses in six states and the District of Columbia. It has repeatedly made Forbes magazine's list of 200 best small companies, and was one of five for-profit education companies (with Apollo Group, Corinthian Colleges, Career Education and ITT Educational Services) on Business Week's list of the top 25 "Hot Growth Companies" last year.

Mr. Wilson says that a field with winners and losers should come as no surprise. "History tells us this is always what happens when there's a new paradigm -- some people figure it out and some people don't," he says. "It's about execution."

With growth has come greater acceptance. "Nontraditional education is becoming traditional," Mr. Wilson says. He should know -- his previous job was running UMassOnline.

Increasingly, students are finding that ivy walls do not a college make. There is certainly no ivy on the walls of the conference rooms at the Hilton hotel in Alexandria, where the University of Phoenix has set up temporary quarters while preparing its latest northern Virginia campus. On a recent night near 10 o'clock, classes are breaking up and about 20 students stream out of a computer science class. Just before ending the lesson, the teacher, Lawrence Wallace, encourages the students to get in touch if they have problems with the material. "If you get stuck during the week, don't hesitate to send me an e-mail," he says.

The class is diverse. A woman in camouflage fatigues and Army boots -- the genuine article, not thrift-store look-alikes -- leaves about the same time as an elegant woman with a Louis Vuitton bag and just ahead of Jason Hoopingarner, a 23-year-old construction manager who started his college career five years ago at Radford University, near Roanoke, but dropped out after two years. "I need to work full time," he says. "I've got an infant son. This fit perfectly."

Fitting perfectly is what continuing education strives for. A big part of the business plan is to strip away the elements of a traditional college that cost so much: fancy campuses, dormitories, athletic complexes, tenured faculty and the pond that shows up in every brochure. At the same time, the institutions strip away things that can be frustrating to students -- the commute, parking woes, long lines at registration, inconvenient class times. They focus on what in the business world is called customer service, often nonexistent at traditional colleges. "They tend to be better at student services than traditional institutions are," Dr. Twigg says. "Adult students are more demanding. You can still push kids around."

That lesson has been carefully learned at Sylvan Learning Systems, which runs Walden University in the virtual world. Most of the students are 35 to 42 years of age, says Paula Singer, the company's president and chief executive. "They want to be treated in a very specific way." Describing a world in terms that sound more like Nordstrom than ivory tower, Ms. Singer says, "If you can make the consumer and end user side of the experience seamless, then they can focus on the learning." In the blended language of Sylvan, the student ombudsman is called a concierge.

"We believe, even though we have this high-tech approach, it can be done with a high-touch equivalent," she says.

It's such marketing newspeak that raises hackles among traditionalists, who see the new companies serving up tools and training while sacrificing the ideals of higher education for the bottom line. Philosophy? The meaning of life? You're in the wrong ed shop.

"Do they serve a niche? Sure. Are they legitimate institutions of higher education? We remain unconvinced," says Stephen Wollmer, a spokesman for the New Jersey Education Association, which represents teachers in the state's community colleges. The group fought to keep the University of Phoenix from opening a campus in the state. It was a six-year, off-and-on battle. Things got nasty: at one point, Phoenix lawyers sent a threatening letter to the teachers' union demanding they stop using the phrase "diploma mill" when describing Phoenix. For one, the group opposes the university's policy of not granting faculty tenure or the academic freedom to choose course content.

"Caveat emptor," Mr. Wollmer says.

After working extensively with the state, Phoenix expects to open a campus this summer in Jersey City, on the Hudson River waterfront. A nearby PATH train station will facilitate commuting from New York, which is so far Phoenix-less. (An application for a campus, possibly on Long Island, is working through the state's regulatory process.)

Forty percent of the faculty in Jersey City will be full time, substantially higher than most of the company's other programs, where the teachers pride themselves on being dirt-under-the-fingernails professionals. Phoenix will also pay $25,000 a year for its students to use a neighboring college library, to comply with state requirements that each college have at least a 50,000-volume library. "New Jersey wanted to make sure that we would meet all of the standards, and we do," says Laura Palmer Noone, Phoenix's president.

Traditionalists may be most rattled by the for-profits' stated purpose of providing an education that leads to employment. "Students are looking for a job outcome," says Mr. Gallagher, the education analyst, "and that's what the for-profit institutions are focused on." They do so by building direct relationships with employers and employment agencies. "The for-profit institutions are very savvy at aligning their offering to employer needs," he says, especially since many companies pay for their employees' continuing education. More than half of University of Phoenix students get some reimbursement from their employers.

But the analogy to customer service goes only so far, Dr. Noone says. "Customer service doesn't mean always saying yes," she says. "If people come in and say, 'I want an A,' the answer is not necessarily going to be yes." The university tries to strike a balance between rigor and helping students succeed, she says.

Students do not have to meet the tough entrance standards of many universities, but Dr. Noone says that is by design.

"We'd like to think that somebody who might not have been successful in school 15 years ago might be successful now," she says. About 35 percent fail to complete the program. "A lot of students who end up not completing the program say that it is because it was too rigorous," she says. For others, "life just gets in the way." Children are born or jobs lost, and education goals recede.

None of it would work at all without satisfied customers, says Jared Bleak of Harvard. "At schools like Phoenix," he says, "people get what they paid for, which is training and certificates which yield a promotion or a job." Mr. Bleak has a brother who is getting his master's degree through the University of Phoenix. "He'll end up making a lot more money than me," Mr. Bleak says with a laugh. "I look at my Harvard degree and say, 'Man! What went wrong?"'

For his part, Mr. Hoopingarner is completing a degree at Phoenix started in his teenage years. He says his previous college experience was "like an assembly line."

"It's so personal here," he says. "It makes it easier." He credits knowledgeable small classes. "It's not sitting in an auditorium with 200 other students," he says.

He thought about applying to George Mason University in Fairfax, Va. But before things got rolling, the Phoenix marketing department got hold of his phone number when he made some Internet inquiries and "gave me a spiel about the accelerated package." What would take two years' worth of work at George Mason could be done in half the time through Phoenix, the saleswoman said.

Mr. Hoopingarner says it is tough starting work at a construction site at 5:30 and ending the day with classes that run until 10 p.m., but he has a goal. He hopes that a degree in business administration will help him as he takes a larger role in his family's construction business. "I've got to deal with it for another year," he says.

Like Mr. Grande, Mr. Hoopingarner says a big problem is getting enough rest. On a recent evening, his wife had a friend visiting from Australia, and he invited a friend over to the house, too. Mrs. Hoopingarner popped their wedding video into the VCR to show them. "The next thing I know, I'm passed out on the couch with three people around me," he says, clearly embarrassed.

But he wants to put effort into his degree this time, and works harder than he ever did at the traditional college. "The classes I'm taking now blow those out of the water," he says. "It's so much more demanding. I feel that I'm walking away with a lot more from it, too."

Mr. Grande, a big guy with dark hair and an engaging, Rodney Dangerfield delivery, is making up for a gap in his résumé that has left him with a feeling of unfinished business.

Some people find their adult college with a Google search. When Mr. Grande decided to go back to school, he worried about the diploma-mill trap. "I wanted something real," he says. "Then I saw UMass and thought, 'You know, that's a real school! They have a basketball team and everything!"'

His first attempt to get a degree, at Westchester Community College, had not gone well. "I was more worried about going out at night than with going to class in the morning," he says. "I didn't really take it seriously."

Now, some 15 years later, he has a wife, a job, a home and two children, and he is a more serious person. "Since I started going back and paying for it myself, it's not, 'Will I pass with a C?' I want the A!"

Copyright © 2004 The New York Times Co. Reprinted with permission.

Date: 04/25/04