Moody's: Competition, consolidation shape online education market

educationdive | April 11, 2019

Competition is heating up for colleges online, and new market entrants are gaining share, according to a new analyst report from Moody's Investors Service, which calls the expansion "a credit positive" for higher education. Online-only enrollment grew 38% from 2012 to 2017, and it will continue to increase as "a key enrollment strategy" for institutions, the authors write. However, not all colleges will take this route, and it is "unlikely to replace" on-campus education. Still, the growth online comes as overall higher ed enrollment has leveled off. Critical to colleges' success online is differentiation, which can include price, delivery model, perceived value and faculty service levels. Public universities' large online enrollment, low tuition and access-oriented mission will help them maintain market share. The Moody's analysts, led by assistant vice president Pranav Sharma, are cautious about colleges seeing online programs as a panacea for their financial woes. "The capital investment, expertise and institutional commitment required to develop online education at scale are often too great to make this a worthwhile strategy for many institutions," they write, noting that barriers to entry online are low, but the bar for success is high

Spotlight

A new one-week course, called Humanities Research Intensive, teaches first- and second-year undergraduate students what research in the humanities could be and what skills are needed to do it.

Spotlight

A new one-week course, called Humanities Research Intensive, teaches first- and second-year undergraduate students what research in the humanities could be and what skills are needed to do it.

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