Is Online Education Plateauing?

A blog about business and economics.
Sept. 20 2012 9:15 AM

Is Online Education Plateauing?

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Demand for online higher education looks flat, but the supply is booming thanks to Coursera and others

Screenshot /Coursera.org

In hip economic circles there's enormous enthusiasm about the potential of online education services to transform the sector in much the way that digital technology has drastically altered the news business. But Kay Steiger notes some evidence that on the student side interest in this option is plateauing rather than surging:

A new survey from Eduventures (the terrible punny name is not my fault) comes via Inside Higher Ed and finds that though the number of adults entering into higher education as non-traditional students continues to increase, the percentage interested in taking all or most classes online has roughly stayed stagnent. The survey found 38 percent were interested in taking all or most of their classes online compared with 37 percent in 2006.
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I don't think that means the basic hypothesis of the online education enthusiasts is wrong, but it does remind me that D.C. people sometimes underestimate the "someone has to figure it out" factor in innovation. In other words, people sometimes look at a situation where dramatic progress isn't happening and then start debating what crucial policy lever is to blame. But sometimes what's to blame is simply that innovation doesn't occur on a frictionless plane. Actual human beings need to come up with ideas, persuade other human beings of the merits of those ideas, try them out, learn from mistakes, tweak, and iterate. The basic logic of online education seems clear, but even though the technological sideshows—broadband speeds, smartphone penetration—has advanced a lot over the past five years, I'm not sure anyone's really devised fantastic courses yet. So what looked promising five years ago still looks, well, "promising" rather than like something that's arrived.

What's different if you ask me is that way more people are trying on the content side than were five years ago. Read what Will Oremus wrote yesterday about the huge growth of Coursera, for example. This vastly increased supply means a much higher chance that someone will come up with something compelling. 

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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