Are online courses impactful?

‘In economics, things take longer to happen than you think they will, and then they happen faster than you thought they could’

                                                           - Rudiger Dornbusch

I am sure most of you who are reading this post would have heard of some sort of education/training that can be taken on the Internet. Online learning has several meanings and can connote anything from a single course taken via the Internet, to a full-fledged virtual school; to a blended-learning model that combines face-to-face and online instruction. While online education seems to be the new fad for learners across all age groups, it is important to understand the real-world impact it is making on the learning eco-system.

Market Size and Opportunity

Let’s start by looking at the U.S. education system. Like most education systems worldwide, the US education system is divided into two major components: K-12 (primary and secondary education) and Higher Education (undergraduate and above). According to Sloan Consortium’s recent report, more than 6 million American higher education students are enrolled in at least one online course. This figure roughly translates into roughly 32% of the higher education market, with an annual growth rate of 10.3%. The market size for online learning in the K-12 segment looks equally promising with 3.8 million American K-12 students, translating into 5% of the K-12 market, with an annual growth rate of 15% along with a market opportunity of $2.4 billion. An increasing number of educators and administrators are turning to online learning platforms. 77% of educators believed that the learning outcomes of online courses met or exceeded those oftraditional face-to-face models.  The success of these courses is further explained in a 2010 report by the US Department of Education, which supports the argument on learning outcomes of online education.

The Economic Impact of Online Education

A recent report by College Board shows that the average tuition at public colleges and universities increased by 27% beyond the rate of inflation between 2007-08 and 2012-13. According to Peter Thiel, Partner, Founders Fund, students in the U.S. don’t get their money’s worth from traditional college instruction. He further states that the education bubble is waiting to burst due to rising student debt, which currently goes into trillions of dollars. Many people pay high fees for education as they see it as a form of insurance, but sadly that view is rapidly diminishing with a growing number of people not finding employment after graduation, directly impacting the country’s economy.  Hence, one of the main factors contributing to the growth of online education is the low cost of these courses. Ranging from free courses to a few thousand dollars, these courses offer a wide range of prices that are substantially lower than their physical counterparts.  

Despite the enthusiasm surrounding online learning, there is a growing amount of angst from its uninhibited usage. Michael A. Cusumano, a professor at the Sloan School of Management at M.I.T., in his article warns that we need to seriously consider the economic impacts of these lower priced courses, especially free online courses, as they have the potential to wreck the traditional university system. He argues that if more number of universities and colleges join the free online education movement, it will set the threshold price of the industry at zero, which would become commonly accepted and difficult to undo. Cusumano is not alone in his skepticism; many others believe that online learning cannot replace the experience of face-to-face learning. Data shows that approximately 10% of students enrolled in online courses complete them, and only 9.4% of American schools are planning to incorporate MOOCs into their curriculum. On the other hand, social scientists such as Sherry Turkle in her book AloneTogether notes that online networks do not provide the same kind of engagement as physical interaction, and increased usage of these networks promotes loneliness and inauthenticity.  Optometrists also point out to the adverse effects resulting from prolonged usage of computers. Research points out that ComputerVision Syndrome affects 50-90% of people who work at a computer screen.

Bottom Line – Online learning is here to stay. However, its rapid growth cannot completely displace face-to-face learning. The most impactful way forward is to not only make online learning more participatory, but also blend it with physical instruction to provide hybrid learning. More studies will hopefully unravel what could potentially become the best practices in hybrid learning.