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College for $99 a Month

The next generation of online education could be great for students -- and catastrophic for universities.
 
 
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Like millions of other Americans, Barbara Solvig lost her job this year. A fifty-year-old mother of three, Solvig had taken college courses at Northeastern Illinois University years ago, but never earned a degree. Ever since, she had been forced to settle for less money than coworkers with similar jobs who had bachelor’s degrees. So when she was laid off from a human resources position at a Chicago-area hospital in January, she knew the time had come to finally get her own credential. Doing that wasn’t going to be easy, because four-year degrees typically require two luxuries Solvig didn’t have: years of time out of the workforce, and a great deal of money.

Luckily for Solvig, there were new options available. She went online looking for something that fit her wallet and her time horizon, and an ad caught her eye: a company called StraighterLine was offering online courses in subjects like accounting, statistics, and math. This was hardly unusual—hundreds of institutions are online hawking degrees. But one thing about StraighterLine stood out: it offered as many courses as she wanted for a flat rate of $99 a month. “It sounds like a scam,” Solvig thought—she’d run into a lot of shady companies and hard-sell tactics on the Internet. But for $99, why not take a risk?

Solvig threw herself into the work, studying up to eighteen hours a day. And contrary to expectations, the courses turned out to be just what she was looking for. Every morning she would sit down at her kitchen table and log on to a Web site where she could access course materials, read text, watch videos, listen to podcasts, work through problem sets, and take exams. Online study groups were available where she could collaborate with other students via listserv and instant messaging. StraighterLine courses were designed and overseen by professors with PhDs, and she was assigned a course adviser who was available by e-mail. And if Solvig got stuck and needed help, real live tutors were available at any time, day or night, just a mouse click away.

Crucially for Solvig—who needed to get back into the workforce as soon as possible—StraighterLine let students move through courses as quickly or slowly as they chose. Once a course was finished, Solvig could move on to the next one, without paying more. In less than two months, she had finished four complete courses, for less than $200 total. The same courses would have cost her over $2,700 at Northeastern Illinois, $4,200 at Kaplan University, $6,300 at the University of Phoenix, and roughly the gross domestic product of a small Central American nation at an elite private university. They also would have taken two or three times as long to complete.

And if Solvig needed any further proof that her online education was the real deal, she found it when her daughter came home from a local community college one day, complaining about her math course. When Solvig looked at the course materials, she realized that her daughter was using exactly the same learning modules that she was using at StraighterLine, both developed by textbook giant McGraw-Hill. The only difference was that her daughter was paying a lot more for them, and could only take them on the college’s schedule. And while she had a professor, he wasn’t doing much teaching. “He just stands there,” Solvig’s daughter said, while students worked through modules on their own.

StraighterLine is the brainchild of a man named Burck Smith, an Internet entrepreneur bent on altering the DNA of higher education as we have known it for the better part of 500 years. Rather than students being tethered to ivy-covered quads or an anonymous commuter campus, Smith envisions a world where they can seamlessly assemble credits and degrees from multiple online providers, each specializing in certain subjects and—most importantly—fiercely competing on price. Smith himself may be the person who revolutionizes the university, or he may not be. But someone with the means and vision to fundamentally reorder the way students experience and pay for higher education is bound to emerge.

 
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