Tensions were high Wednesday at New York University's Stern School of Business, as a group of academics, venture capitalists, and entrepreneurs faced off during a panel discussion on the future of higher education.
The panelists, including NYU President John Sexton, Harvard Business School professor Clayton Christensen, and Codecademy CEO Zach Sims, among others, were charged with predicting the future of the traditional university. Will emerging technology and online learning dismantle the notion of "college" as we know it?
Predictably, the academics took a markedly more conservative view than their start-up counterparts, but there was one thing everyone in the room could agree on. As Sexton put it, "The status quo is not an option. We're in for what I call a radical restructuring of higher education today."
Here are six big ideas about how tech incumbents are about to drastically change the face of education:
1. Technology can help universities discover talent.
NYU President Sexton heads up the third most expensive university in the country (and, yes, my alma mater), but even he admits that this model is far from perfect and that there are too many universities charging students too much for too weak an education. In the future, he said, there will be a major consolidation of colleges across the country. That doesn't mean, however, that he thinks the traditional university will disappear.
"I want to resist being cast as a dinosaur here, but the fact that opera doesn't have the same broad-based appeal as Jay Z doesn't mean society would be better off without it," he said. "There will still be room for a dinosaur or two."
But those universities that are left standing, he says, will have to do a much better job at identifying talented students, who can't afford to pay $61,000 a year for school. "We're doing a horrible job right now," he said. "If we use it correctly, technology will become a talent identifier."
Sexton pointed to NYU's own partnership with University of the People, a nonprofit that offers tuition-free online education to students in the developing world, as a prime example of technology's ability to unearth talent. Promising students identified at University of the People are eligible for admission at NYU's Abu Dhabi campus.
2. Low cost education technology will eventually rob universities of students.
As a scholar of innovation, Christensen approached the future of higher education through the prism of past industries that have been disrupted. He said there are two concentric circles of potential customers for any innovation: the inner circle consists of the wealthy, and the outer circle, of the masses. When a new industry arises, he says, it almost always begins in the innermost circle.
"Initially, products and services are so costly and complicated that only the wealthy have access," he said.
It was the case with the mainframe computers of the 1950s and early televisions in the 1960s. The problem is, the companies that tend to start in those inner circles have a tough time disrupting their own technology with a more affordable and accessible option. Their business models don't allow for it. So, an incumbent comes in with the more affordable, more accessible technology and begins selling it to the outer circle of people, who have no other option. Slowly, but surely, customers from the inner circle begin gravitating to the new innovation. That's how the transistor radio disrupted the television and how the personal computer rendered the mainframe computer obsolete. And so it will go with education, Christensen said.
"The people who jumped on first to online learning were the ones who couldn't come to NYU. It was better than nothing," he said. "But the technology will get better and better and then the customers get sucked out. The question is not whether this will occur, but what role universities will play."
3. Loans will be paid back later.
Fear of debt is one of the biggest barriers for people who want to pursue higher education, particularly these days, when a degree does not necessarily equate to a job after college. That's why Andre Dua, who counsels local governments and schools in his role as a director at McKinsey & Company, says there's plenty of opportunity for disruption in education finance. By 2025, Dua predicts, we may begin to see organizations offering loans that don't need to be paid back until a graduate has attained a certain income of, say, $50,000 or more.
4. Students will demand practical skills training over soft skills.
Zach Sims founded Codecademy two years ago, after dropping out of Columbia University, where he was studying political science. The education he was receiving, even at this elite institution, he said, wasn't preparing him for life in the real world. In fact, he said, two thirds of college graduates say they will need further training after graduation. In the future, Sims predicts that companies like Codecademy, which teaches people how to code online, will become a more viable alternative to the traditional liberal arts education. Unlike many undergraduate programs, students will walk away from these decentralized online courses with a portfolio of work they can show to potential employers.
"We're still focusing on two- to four-year degree programs that aren't coupled with what people need to know to find a job," he says. "At Codecademy, we're doing one part of something much larger to fix the system."
5. The university will become unbundled.
When universities first took form, if you wanted to hear someone speak, you had to be in the room with them, and if you wanted to read a book, you had to go to the library. Obviously, said Albert Wenger, of Union Square Ventures, that's no longer the case. "We wound up with a hugely bundled model," he said, and now is the time to unbundle it.
According to Wenger, more start-ups will arise that offer some element of the university experience. Science Exchange, for instance, is a Union Square Ventures-backed company that enables researchers to borrow lab space anywhere around the world.
6. The university of tomorrow will not look like a university (or a MOOC).
"I think Coursera and Udacity will be as bad for higher education as the University of Phoenix," said Clay Shirky, a writer-in-residence at NYU's Journalism Institute. "Even though the leaders of those companies right now seem to be true believers, they're one management change away from the scummy business practices that Kaplan and Kapella have adopted."
That doesn't mean Shirky is content with the current model of education, either. "If universities went away today, tomorrow, no one would say, 'Hey, you know what we need?' And come up with something that looks exactly like a university," he said.
Instead, Shirky expects to see more specialized schools like Rockefeller University, which focuses on biomedical research. Others might not look like a university at all. Instead, he suggested, they might look like Polymath University, an online university that's focused on educating students to complete a project, not a major.
"If you think about our stock keeping inside the university, there are seven big constructs: class, course, grade, credit, degree, department, major. Not one of them is real. They're all just how we do it," he says. "Here's what's real: Students are real. Knowing things is real. Being able to do things is real. People will find alternate ways to teach those things. That's where the really disruptive stuff comes from."