Will MOOCs Revolutionize Higher Education?

The hot new buzzword in university circles these days is MOOCs—massive open online courses. They may be the future of higher education. Or maybe not.

MOOCs are just what their full names imply: online courses that anyone anywhere in the world with access to the internet can take. And massive means just that: massive. A MOOC on artificial intelligence that Stanford offered last year attracted more than 160,000 students. This spring MIT offered a MOOC on "Circuits and Electronics" that enrolled more than 150,000 students.

Just how hot are MOOCs? Well, the New York Times reported yesterday that Coursera, a company that announced itself to the world just five months ago, has enrolled 1.35 million students in its free online courses. Coursera draws its courses from faculty at its thirty-three partner universities. And these aren’t obscure directional schools or pump-and-dump outfits that advertise on the back of matchbooks. These are the cream of American higher education: Michigan, Penn, and Princeton to name just a few.

The enthusiasm for MOOCs reflects excitement about the potential economic benefits that could be unlocked by bringing higher education to people around the world. Making it far easier for people to acquire new skills and knowledge wouldn’t just benefit developing countries. It could also help developed countries like the United States seeking to revitalize and renew their human capital. And it could in theory deliver these economic benefits at a fraction of the cost of traditional bricks-and-mortar colleges.

But the enthusiasm for MOOCs also reflects dreams of pots of gold at the end of the MOOC rainbow. The era of persistent double-digit tuition increases looks to be over, so universities are looking around for new revenue sources. (One of the reasons that the University of Virginia Board of Visitors gave for its ham-handed—and ultimately botched—dismissal of UVA president Teresa Sullivan this summer was that she had not moved Mr. Jefferson’s university boldly into online courses as many of its peer institutions had.) The vision of hundreds of thousands of students around the world sending checks to campus bursars is enough to make any academic administrator salivate.

So far most MOOC offerings have been STEM (science, technology, engineering, or math) courses. That makes sense for two reasons. First, students who take such courses are likely to want to acquire skills that translate directly to the workplace. "Critical Theories of Modern Poetry" doesn’t fit that bill. Second, STEM courses lend themselves to right/wrong answers that can be graded by computer. Who wants to wade through a hundred thousand essays on Robert Frost’s use of metaphors in “The Road Not Taken”? (The humanities aren’t always left out. The Berklee College of Music is offering courses on introduction to guitar and improvisation if you are so inclined.)

For all the excitement over MOOCs, a few glitches need to be worked out. One is that student enthusiasm for MOOCs seems to follow the trajectory of New Year’s diet resolutions. More than half of the students who enrolled in MIT’s circuits course didn’t even bother to complete the first assignment, and just 7,157 students (or less than 5 percent of enrollees) passed the course.

Then there is the matter of credentials. Several of the earliest MOOC courses have offered students certificates for completing the class. The certificates may be suitable for framing, but it’s unclear that potential employers will see them as anything more than participation ribbons. Workplace acceptance is especially a problem given that MOOC sponsors have yet to create systems for ensuring that the person who receives the certificate is the person who took the exams. And then there is the question of how individual course certificates might be bundled into something approximating a college degree.

But the biggest problem with MOOCs is their business model, or more precisely, their lack of one. As the New York Times described the Coursera venture earlier this year:

Coursera does not pay the universities, and the universities do not pay Coursera, but both incur substantial costs. Contracts provide that if a revenue stream emerges, the company and the universities will share it.

Or as the Times quotes Ohio State president Gordon Gee in its story yesterday:

We’re doing this in the hope and expectation that we’ll be able to build a financial model, but I don’t know what it is. But we can’t be too far behind in an area that’s growing and changing as fast as this one.

Savvy administrators may yet figure out how to successfully “monetize” MOOCs. And not all MOOC initiatives are intended to generate a profit. EdX, which Harvard and MIT started and which now includes the University of California, Berkley among its members, is a not-for-profit venture. But even (intentionally) not-for-profits have to find a way to cover their costs.

So at this point, it is premature to predict that MOOCs will be the golden goose for cash-starved U.S. colleges and universities—or that they will remake the world of higher education as we know it.