Facing Online Enrollment Challenges, Florida Rethinks Pearson Partnership (CHE)

Facing Online Enrollment Challenges, Florida Rethinks Pearson Partnership (CHE)

September 11, 2015

By Sarah Brown

The University of Florida is discussing changes in its partnership with Pearson Embanet for running the university’s online bachelor’s-degree-granting arm, UF Online, including possible termination of the contract.

Pearson was brought on in the fall of 2013 to handle marketing, recruitment, and student support for UF Online, a $35-million effortspurred by the Florida Legislature. It was considered one of the most ambitious online-education projects to take shape in recent years. But because of low out-of-state enrollment, university administrators this summer began to evaluate the institution’s contract with Pearson — an 11-year agreement, with up to $186 million in revenue for the for-profit company.

The long-term target in UF Online’s business plan calls for about 24,000 enrolled students by 2024, with 43 percent of them coming from outside the state. While UF Online has met many of its goals so far, it has done so with more in-state students, who pay less than Florida residents attending classes on the campus and significantly less than out-of-state online students. UF Online has enrolled 1,647 students for this fall, and 9 percent of them are nonresidents.

Given that the nonresident benchmarks haven’t been met, the university has the right to review the contract and potentially terminate it, said W. Andrew (Andy) McCollough, associate provost for teaching and technology.

Florida administrators are exploring several possibilities for change, including taking at least some of the services that Pearson currently offers and handling them internally, Mr. McCollough said. He wouldn’t predict the likelihood that the contract would be canceled altogether.

If the contract is downsized or terminated, it would mark another blow for Pearson, which deepened its commitment to online education in 2012 with its $650-million purchase of EmbanetCompass, a support service for colleges moving degree programs online.

eCollege, which is also owned by Pearson, had contracted earlier that year with the California State University system to help run its fledgling online bachelor’s-degree program. But in 2013, with only a handful of majors on offer and low student enrollment, Cal State abandoned much of the program’s original design, and Pearson’s role was diminished. An advisory board called the company’s marketing services “not adequate.”

Some faculty members and other observers often question the role of for-profit “enablers,” like Pearson, in colleges’ online-education efforts, given that the companies tend to claim much of the resulting revenue. However, at both Cal State and Florida, there was pressure to get the programs up and running quickly, which increased the need for an outside company to handle administrative tasks while the colleges focused on developing course content.

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