Idealism trodden in rush to market?

June 8, 2001

Academic alliances are strained as rivals pile on pressure. Clashes between commerce and universities seem inevitable following a series of deals that could result in potential conflicts of interest.

Multinational companies offering private courses have entered into multiple collaborations that some warn could lead to the sullying of the image of universities. As a result, institutions are jumping in and out of bed with private partners and each other.

In the last month, a deal between Thomson Learning and Universitas 21, a global network of research-led universities, led to the University of Toronto quitting the network and another refusing to become involved in the money-making venture.

Sheldon Levy, who specialises in e-learning at the University of Toronto, said there were many questions that needed answering before the university would be prepared to participate in the online venture, called U21 Global.

He asked: "What is the main objective of a company or consortium delivering e-learning? Is the motivation to make money or to improve the quality of learning?

"If you are part of a consortium, how do you protect quality and your name? For example, if an institution is paid a sum of money to be a member of a consortium but is then expected to allow the use of its name and logo without having direct control of the product, is that a good deal?

"And to what extent will partnerships preclude or constrain independent action, and what is the potential for ending up in competition with yourself?" U21 Global plans to sell postgraduate courses including MBAs in e-commerce and information systems. The courses will be targeted at Southeast Asia and Latin America and delivered in English, Mandarin and Spanish.

Thomson is rumoured to be putting $25 million (£17.6 million) into the venture, with the individual members contributing between $500,000 and $5 million each to match the private funding. Thomson is expected to give the final go-ahead next week.

The joint venture follows the collapse of a deal between U21 and Worldwide Learning, a subsidiary of News International's TSL Education, which publishes The THES .

Last month, Thomson also announced a new partnership with the Apollo Group, which owns the University of Phoenix, the largest private higher education institution in the United States. Under the deal, Thomson will provide electronic educational content in business, social sciences, physical sciences and information systems for the Apollo Group's electronic resource initiative.

Three months ago, Thomson invested $35 million in UNext, a private company established by the London School of Economics and four US institutions. UNext operates an online institution, Cardean University, which sells MBAs and other business courses. The chief executive of Thomson, Richard Harrington, sits on the UNext board of directors.

Neil Gregory, head of the research and project development division at the London School of Economics, said: "Thomson's investment in both (UNext and U21 Global) has some complementarity. UNext has competitive advantage in its consortium and learning system, and U21 Global has broader geographic reach and subject spread."

Intriguingly, the University of Michigan - the U21 member which is remaining in the organisation but refusing to become involved in U21 Global - is also in talks with UNext. Michigan is also a member of Fathom, another organisation of British and US institutions which offers online learning. Last month, Fathom announced a partnership agreement with the BBC and BBC Worldwide to create and distribute online seminars.

Gary Krenz, special counsel to the president of the University of Michigan, said: "We declined to participate in U21 Global because it just does not fit with our plans at this time. We were not prepared to license our name for degree-granting purposes. We had concerns that our faculty would not be sufficiently involved in the development or quality control of the venture's academic programmes. And we're also engaged in other approaches to e-learning, and we determined that our particular educational interests would likely be better served through those other activities than through the U21 and Thomson joint venture."

The BBC has also made multiple agreements with various institutions. In addition to its long-standing relationship with the Open University, the BBC is expected to play a role in the British e-university.

Other media organisations involved in this web of deals include Pearson Education, which through its subsidiary FT Knowledge offers distance learning MBAs with Heriot-Watt University's Edinburgh Business School. Pearson has also expressed interest in joining the e-university announced by David Blunkett last February.

News International's Worldwide Learning is also involved with Heriot-Watt University through its £3.5 million investment in Scottish Knowledge, a consortium formed by Scottish universities and colleges. Scottish Knowledge sells online undergraduate and postgraduate degrees plus paper-based distance learning and overseas teaching.


The e-university has been much changed since it was first announced by the then education secretary, David Blunkett, in his University of Greenwich speech last February.

Gone is the core of elite institutions, ditched in favour of a more inclusive model. The Higher Education Funding Council for England has now invited all universities and colleges to become members of the e-university holding company for £1 each. Membership of the company, which is intended to maintain academic standards at the e-university, will be announced later this month. Its directors, however, have already been announced. They include the heads of seven pre-1992 universities, two post-1992 institutions and two colleges.

Once the holding company is formed, it will establish joint venture partnership with commercial interests to operate the e-university. The government is putting £62 million over three years into the venture from the holding company's side.

Alice Frost, the e-university project manager, is confident that the funds will be forthcoming from the private sector. She is assessing expressions of interest and will announce the chosen partners at the end of this month.

The e-university aims to enrol its first students next year.


Universitas 21 : the universities of Birmingham, Edinburgh, Glasgow and Nottingham; Lund University, Sweden; Freiburg Univer-sity, Germany; the universities of Melbourne, New South Wales and Queensland, Australia; the University of Auckland, New Zealand; the University of Michigan, US; McGill University and the University of British Columbia, Canada; the National University of Singapore; and Fudan University and the universities of Hong Kong and Peking, China. Three further US institutions are joining: New York University, the University of Virginia and Georgia Institute of Technology.

UNext : the London School of Economics and Political Science; Carnegie Mellon University, Columbia Business School, Stanford University and the University of Chicago Graduate School of Business, United States. The organisation is also in talks with the University of Michigan.

Fathom : Cambridge University Press, the London School of Economics, the British Library, the Victoria and Albert Museum, the Science Museum and the Natural History Museum; Columbia Univer-sity, the New York Public Library, the University of Chicago, the University of Michigan, the American Film Library, the RAND corporation and Woods Hole Oceanographic Institution, US.

Scottish Knowledge : Abertay Dundee University; Edinburgh College of Art; Fife College; Glasgow Caledonian University; Heriot-Watt University; Highlands and Islands Millennium Institute; Napier University; Paisley University; Queen Margaret College; the Royal Scottish Academy of Music and Drama; Robert Gordon University; the Scottish Agricultural College; Strathclyde University; and the universities of Aberdeen, Dundee, Edinburgh, Glasgow, St Andrews and Stirling.

Worldwide Universities Network : the universities of Bristol, Leeds, Manchester, Sheffield, Southampton and York; University of California, San Diego; University of Illinois; Pennsylvania State University; University of Washington, Seattle; and University of Wisconsin-Madison. The network aims to expand its membership to include partners in China and Europe.


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