Friday, September 04, 2009

Bending the Cost Curve on Education

Some have even concluded that "college, as an asset class, is a bubble" (InvestingwithOptions). Technology, in its ability to provide cost effective alternatives may change all that. Washington Monthly profiles StraighterLine, a company that offers accredited courses for an incredible cost of $99/month allowing you to finish as many courses as you can in that time period:

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.
Another interesting datapoint is one made by the Economist blog that suggests "an increase in tuition makes the school more desirable as a status symbol" and increases networking opportunities for students. What I find fascinating about these stories (beyond the obvious that markets force accountability) is that technology is unbundling university into its component parts - offering knowledge and the recognition of learned knowledge without the extra "features" that consumers aren't interested in. This does not bode well for institutions that ignore the idea that prices can be sustainably divorced from the reality of the underlying value they offer.

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