The statistics around Massive Open Online Courses (MOOCs) are extraordinary. In a little over a year, more than 6.5 million students have enrolled in over 800 free classes produced by about 200 universities all around the world. Harvard and MIT have poured $30 million each into their edX collaboration. Private investors have made similar sized bets into Silicon Valley- based Coursera, a rival MOOC platform.
Technology messiahs foretell a world in which anyone anywhere anytime can access high quality higher education at no or low cost. Prophets of doom envisage a MOOC tsunami sweeping away the ivory tower. Skeptical hard heads counter by paraphrasing Mark Twain: talk of the demise of place-based universities is grossly exaggerated.
There is ample history to support the skeptics. Universities have gone from strength to strength in the Internet age. In contrast, MOOC completion rates are extremely low. And the business model behind giving away classes at no or very low cost to the student is at best embryonic.
Nonetheless, we believe MOOCs are here to stay. This is not only because ways to charge for completing them are now emerging. At least as importantly, MOOCs are valuable loss leaders for traditional universities.