Conflating Is and Should

Was this forwarded to you by a friend? Sign up, and get your own copy of the news that matters sent to your inbox every week. Sign up for the On EdTech newsletter. Interested in additional analysis? Try with our 30-day free trial and Upgrade to the On EdTech+ newsletter.

Three weeks ago I wrote a post arguing against an OPM analysis report claiming that “Fee-for-Service is now the norm in the OPM market.”

The post then criticized the overly-broad definition of an OPM (a topic that we addressed in a podcast episode (audio-only or video), including a suggested definition) and poor data descriptions.

Continuing Conflation

Since that time, I’ve read some interesting discussions triggered by the post and had private conversations at conferences on the topic. All well and good. But I would like to respond to a theme of reactions that needs to be addressed more explicitly. As my point is to deal with the subject at hand in a general sense, I have included direct comments below but not names.

The problem here is conflating my desire to describe the market realities accurately with an implied belief that rev-share OPMs should be the dominant model, or that I see no value in fee-for-service models. I am not pro- and anti- either model, and my primary concerns are having an accurate understanding and universities making the best choices given their needs.

A Thought Experiment

What if I were an advocate for getting rid of rev-share OPM contracts and moving the market to fee-for-service?

• In this case, I would want to know whether in fact the market was already moving en masse to fee-for-service OPM arrangements (or even unbundled services or insourcing arrangements). If the market were moving this way, then my (and my allies’) advocacy efforts are working, and we would need to keep up the pressure and even double down.

• But if the market in reality is not moving en masse, then I would want to know why. My hunch is that the biggest reason is rev-share arrangements providing low-risk capital in a way that most fee-for-service models don’t, and I would want to directly deal with this key need from universities instead of wishing it away.

Project Kitty Hawk (PKH) is an example of attempting to address this need. Rather than using rev-share, PKH offered grants and deferred payment options for universities wanting to work with it as an internal OPM. Other public university systems should consider this approach - proactively provide startup capital funding for new online programs rather than expecting cash-strapped individual institutions to be willing to invest.

The state of Minnesota and to a degree the University of California system are taking a different approach - take away the option of rev-share OPM agreements. That approach has a big problem, however, if one expects new online programs to flourish despite the lack of funding.

My advocate self would want to take the right actions and back the right policy moves in order to maximize the move to fee-for-service. And accurate knowledge of the market is key to advance this goal. I would want to win the actual market movement battle and not the media battle.

The main On EdTech newsletter is free to share in part or in whole. All we ask is attribution.

Thanks for being a subscriber.