According to the European University Association (EUA), there is a clear reason why the take-up of MOOCs is much higher in the U.S. than in Europe: it’s all about the level of financial autonomy and funding structures of universities. In its newest paper on MOOCs, the EUA continues to see a rift between the EU and the U.S. when it comes to Massive Open Online Courses (MOOCs).
“Universities on both sides of the Atlantic find themselves in very different situations and respond differently to MOOCs. U.S. institutions are under a much stronger economic pressure to respond, and reaction in the U.S. ranges from determination to develop new education and business models to concern about the future for those institutions that cannot develop MOOCs, and about higher education in general.”
On the other hand, many European universities “Seem to be more concerned about lagging behind international competition, and look at MOOCs as a global promotion opportunity.”
Benefiting students all over the globe
The underlying discussion is a one about financial viability and business models. The funding structure of many European universities would render them less suitable to compete in the MOOC-market, concludes the EUA. Spending money on MOOCs that would benefit students all over the globe, rather than your own registered students, is difficult to justify for a university.
“The production costs of MOOCs vary greatly”, says the EUA report, depending on how the MOOC is produced. “The full cost might be around € 2900,000-€250,000, whereas the production cost (excluding work time of academic staff and probably also university technical staff) might range from €30,000-€50,000.”
Not sufficient funding autonomy
“Whether universities can allocate funding to initiatives like MOOCs may differ from country to country, depending on their level of financial autonomy and funding rules. For European Universities, which to a large extent are publicly funded, the question arises whether they have sufficient funding autonomy to produce MOOCs. Funding rules may also influence the decision on whether production and maintenance of MOOCs can be outsourced.”
“For the institutions and the public the question is also whether these expenses can be justified, in particular in times of austerity – given that they do not, or not in first line, benefit/aim at the institutions’ actual students.”
In the U.S. on the other side MOOCs companies are able to gather significant amounts of venture capital. “Coursera announced to have raised another $43 million in venture capital, on top of the $22 million it had banked last year”, the paper states.
“Their ability to gather venture capital suggests that there is economic potential – but only time will show whether these MOOCs initiatives are successful or doomed to fail. Predictably their success will depend firstly on business strategies and markets, and only secondly on educational needs and quality.”