Note there is additional new material at the end of this column — Bob

I am old — so old that when I was a college freshman there were dormitories filled with men and others filled with women but no dormitories at all filled with both men and women, at least not where I went to school.  The women had it so bad that there was literally a time clock for signing-in and -out under the stern gaze of an old biddy tending the front desk — a desk she was determined that I, in particular, would NEVER get past.

And yet I did.

There was a public room for meeting visitors at the entrance of the women’s dorm, there was the front desk, and behind it the hated time clock with about a hundred paper cards — one for each resident — for punching in and out.  Women had to be in their dorms (I am not making this up) by 10PM, after which the front desk closed and anyone coming-in later than that presumably went straight to jail — or to Hell — it was never made clear which.

Then one night I stole all the time cards.  The biddy was gone from her post for just a moment, I vaulted the swinging gate, gathered-up all the time cards, and ran outside with my haul, which I later burned.

The cards were never replaced.

Sometimes change requires a catalyst and 39 years ago at a little college in Ohio I was that catalyst.  Social mores were changing, even in Amish country, and it was only a matter of time before these same-sex barriers would fall.  But still something has to happen to MAKE them fall.

I sense something similar coming for higher education in America, but this time it is likely to be the embrace of virtuality and what will go away could be the school, itself.

MIT has all its lectures available for viewing for free over the Internet.  Why hasn’t some entrepreneur yet leveraged this amazing act of generosity?  Some little school could outsource its entire physics department, for example, using MIT lectures and a single professor in-house.  My physics department had only 2.5 professors (the .5 was the department chair who drove a cab on the side) and we didn’t have the benefit of MIT video.

There is enough good material available for free online right now that it would be easy to create a virtual university (WikiVersity?) with the only thing missing being the granting of degrees.  It’s that whole “degree from MIT” thing that allows that school not to worry about sharing its lecture bounty, because in the education system lectures are viewed as worthless unless they lead to a degree.

Why is that?

My friend Richard Miller (he designed the Atari Jaguar video game console eons ago) is one of the smartest engineers I’ve ever met yet he doesn’t have a degree in engineering.  Apple II designer Steve Wozniak got his degree from UC Berkeley only after leaving Apple in the early 1980s.  In both cases their employers couldn’t have cared less.

What drives the education industry is producing degrees while what drives the computer industry is producing products and services.

When was the last time any employer asked to see your academic transcript?  Have they ever?

What’s missing here is the higher education equivalent of a GED.  Someone will come up with one, or they should, because all the other parts of the system are ready to go.

Cushing Academy, a tony prep school in western Massachusetts, is right now replacing its 20,000-volume library with a “learning center” containing 18 eBook readers, three giant TV screens, and a $12,000 espresso machine.  I wonder why they need a building or even a room at all; wouldn’t it be cheaper just to give each kid an eBook reader and a Starbuck’s gift card?

We’re on the cusp of a new era where the marginal cost of insight is low enough to create new kinds of virtual education institutions.  The important concept here is insight, which means more than fact, more than knowledge.  It is the link between facts and knowledge, a true act of understanding that enables thinking people to create something completely new.  Without insight you don’t know jack. But insight generally comes through personal connections — connections that to this point we’ve typically had to create campuses and pay $50,000 per year to enjoy.

That no longer makes sense.

Education, which — along with health care — seems to exist in an alternate economic universe, ought to be subject to the same economic realities as anything else.  We should have a marketplace for insight.  Take a variety of experts (both professors and lay specialists) and make them available over the Internet by video conference.  Each expert charges by the minute with those charges adjusting over time until a real market value is reached.  The whole setup would run like iTunes and sessions would be recorded for later review.

Remember, all lectures are also available online for free. What costs is the personal touch.

Say a particularly good professor wants to make $200,000 per year by working no more than 20 hours per week or about 1000 hours per year.  That gives them a billing rate of $200 per hour.

Now look back at your university career.  How much one-on-one time did you actually get with the professors who really influenced your life?  I did the calculation and came up with about two hours per week, max.  Imagine a four-year undergraduate career running 30 weeks per year — 120 total weeks of school — times two hours of insight per week for a total of 240 hours.  At $200 per hour the cost comes to $48,000 or $12,000 per year.

That’s a huge savings compared to the $200,000+ an MIT-level education would cost today (remember the MIT online degree — there is one — costs the same as if you were attending in Cambridge).  And ideally the pool of insightful experts would be far greater than any one university could ever employ.  And that’s the point of this exercise; it can’t be an emulation of a traditional university, because that would inevitably disappoint — it has to be in at least one way clearly, obviously, stupendously BETTER than what’s available now.

This could happen tomorrow, the pieces are all there ready to be put together.  Ironically it leverages one of the great red herrings of the Internet era — micropayments.  So much could happen, we’ve all said, if only we could build a micropayment system that would actually work.  Well we can, and what makes it work is that the payments at $200 per hour aren’t so micro.  But they are micro enough.

It’s time to vault the gate and burn those cards… again.

Here’s an update as of Sunday night, September 6th — Bob

A number of readers have cited a feature story from Washington Monthly about an online university they see as very similar to the one I proposed above, charging only $99 per month.  The story is here and the school in question is called Straighterline and I found something of a critique of the program here in the Chronicle of Higher Education, which may have an axe of its own to grind.

Straighterline is interesting and cost-effective, but it isn’t exactly what I proposed.  Straighterline is more like online junior college with mainly introductory courses.  this is not to say that it couldn’t become more in time and I hope it does.  But to do so the company will have to take a somewhat different approach.

Straighterline has a problem with accreditation — they can’t get it.  So they cut deals with no-name schools to effectively launder their credits, passing them on to third-party schools.  I see nothing wrong with this but in time Straighterline or schools like it will have to take a more direct approach to the problem of gaining acceptance.  The University of Phoenix did that through the simple expedient of offering real classes all over the place AND charging a lot more than $99 per month for all-you-can-learn.  Exciting as that price is, it is precisely what scares the crap out of many established colleges.

If I were running Straighterline, then, I’d get ready to file a big restraint of trade lawsuit against some big vulnerable school caught up in, say, an NCAA athletic recruiting scandal.  ”Pick your targets carefully,” Pa Cringely always said.

The other thing I would strongly recommend is that Straighterline put some big bucks into recruiting its own stellar faculty.  Spend whatever it takes to get the top people in some discipline to start.  Hire academics if you can and lay practitioners if you can’t.  Most academic contracts don’t prohibit teaching part-time elsewhere and if they do try to stop the practice, well that’s just a further example of restraint of trade.

As for the traditional schools with their red brick overhead, they remind me of a crowd I spoke to years ago in Minneapolis when I tried to explain the Internet to the people who run America’s many state lotteries.

Lotteries, it turns out, are actually run by folks who used to be at the Department of Motor Vehicles.  They have a monopoly in their states on gambling and are determined to pursue it as a form of sin tax.  The idea that I presented in 1998 that Internet gambling could eventually hurt them was laughable: didn’t those Internet folks know the lotteries had a monopoly in their states?

Yeah, right.

My recommendation was to take their games to the Internet and appeal to potential customers outside of Illinois or Iowa, maybe grab some of that easy money from Abu Dhabi.  They looked at me like I had two heads, but history has shown I was correct.

And it will be the same way with my proposed online university or with Straighterline Pro, if that ever comes to be.  Education is a talent business and anyone who can gather the best talent will offer the best service and have the greatest success.  This doesn’t mean that Stanford and MIT will die, far from it.  But it means that some lesser institutions WILL die, while hybrid operations that are entirely new and different may well thrive.

Imagine the various higher education equivalents of drivers schools for people working-off their traffic tickets (remember Comedy Traffic School?).  With a solid curriculum available online to any institution, one point of differentiation can become location (Hawaii, California, France, on ship, etc.) or ambiance (health spa, sports, luxury, religious, etc.).  The classes are identical, but where do you want to drink beer, and with whom?

Maybe this seems silly, but it is also one likely future of higher education.