Mass High Tech - Going the distance
By Patricia Resende
Public and private universities - in New England and across the globe - are competing for a new generation of students seeking to earn degrees remotely while also engaged in other activities such as working full time or raising a family.
Online education giant University of Phoenix was one of the first schools out of the gate in this market, and is aggressively targeting New England students, forcing established schools in the region to rethink their strategy.
And Phoenix, which has opened offices in Burlington, Braintree and Westborough and has plans to open a location in Fairfield, Conn. this fall is not alone in its move to compete in New England. DeVry University, Park University and Webster University are among other universities from outside New England making a play for potential New England students.
David Gray, chief executive officer at the University of Massachusetts Online, said the University of Phoenix has made its presence known in New England."It didn't catch us off guard in any way," Gray said. "They are a major competitive force in the higher education marketplace and, to be frank, one has to be aware of their presence when they move into your back yard and the industry has to see that as a concern and view it with some sense of urgency."
The University of Phoenix is targeting a different group of students in New England and is not trying to compete with other institutions, says Bob Adler, vice president of Massachusetts campuses at the University of Phoenix."We are not the university for all students and we recognize that," Adler said. "We are targeting working adults that have started families and careers and have not been able to achieve educational goals."
Though enrollment was up 20 percent from last year and revenue increased by 26 percent for UMassOnline, the only notable effect Phoenix has had on UMassOnline can be found in its advertising strategy, according to Gray. "We have had to reshape our strategy for marketing programs because Phoenix has had a very telling impact on web-based advertising," Gray said. "Their presence has driven up the cost of advertising."
Kevin Currie, senior associate dean at Northeastern University's School for Professional and Continuing Education, said he believes the University of Phoenix goes after business in a different manner because Phoenix spends approximately $20 million a month on Internet-based advertising. "So obviously if someone is spending $240 million a year, they take one approach, and we have to use a different approach," Currie says.
Phoenix's Adler would not disclose the amount spent on advertising. He would, however, say it is probably higher than $20 million per month. "We are the most recognized university advertised on the Internet and the only way to get there is to be aggressive with our marketing dollars," he said.
To compete, said Gray, the only foreseeable changes for UMass Online will be to "ratchet up its marketing." For Northeastern University, a private college, things won't change much. Northeastern, which offers 194 credit-granting and 15 degree-granting distance education courses with a total enrollment of approximately 3,700 students, plans to focus on its specialized courses as a way to continue and increase its online enrollment.
"Moving into the Greater Boston area is not the same as moving into other areas - this is already a highly competitive environment, generally speaking, with 65 other colleges and universities," Currie said. "It's a little bit like McDonald's building across the street from Burger King and in the corner there is a Friendly's."
In the Bay State, Phoenix offers three programs including a master's in business administration, a bachelor's of science in information technology and bachelor's of science in business management. It has 1,000 students enrolled. Nationally, the school reports 200,000 students enrolled, and offers more than 50 degree programs to students, with an average age of 35 years.
Online enrollments shows a steady growth according to published reports. For instance, a report released last year by the Sloan Consortium, a Needham-based organization created by funds from the Alfred P. Sloan Foundation that focused on practices to improve online education, showed a 22.9 percent increase in the number of students taking one or more online courses, growing from 1.6 million to 1.98 million students in 2003.
That rapid growth resulted in optimism abut future growth, with more than 78 percent of respondents expecting enrollment to increase. The number of students taking at least one online course is now up from 1.98 million to more than 2.3 million total students in fall 2004, an 18.2 percent increase, according to the consortium.
Officials at UMassOnline, which had a total enrollment of 19,728 students and tuition revenue of $19 million for the academic year ending in 2005, say they're confident about efforts to secure online learning enrollment. They also say there has not been a decline in enrollment or revenue since Phoenix came into town. Still, Gray said numbers could be larger if Phoenix and others were not marketing in New England. "In essence we have to work increasingly harder and apply more energy and resources to maintain the kind of growth we have seen," Gray said.