The “Netflix Moment” of Universities

The “industry” that has remained practically unchanged for more than 1000 years is about to get a big shock. 10 years from now, we will be able to see which universities were able to find their niche in order to survive in an environment that is about to change radically.

This article was originally published in Portuguese in Observador on June 16th 2020 at 12:31.

At the end of the day, the transition will depend on universities’ capacity to anticipate the competitive pressure that they will face in the near future, and their ability to resist the comfort of the status quo.

It seems like a distant memory, but it wasn’t so long ago that our Friday night routine consisted of going to Blockbuster’s to rent a video tape - and getting some consolatory popcorn when we couldn’t find the film we wanted.

Fortunately, we now have Netflix – as well as HBO, Amazon Prime, Disney+… – and any film or series available on our TVs, computers, or smartphones, at any time. And on top of this, we pay monthly little more than the price of one rental from Blockbusters back in the day.

These kinds of services made quarantine more bearable for many people, but also left many victims in their wake: Blockbusters for starters, which went bankrupt in 2010, but also many cinemas that closed down, and traditional television which continues struggling to reinvent itself in a sustainable way.

We believe that universities will have their “Netflix moment” very soon. The “industry” that has remained practically unchanged for more than 1000 years is about to get a big shock. 10 years from now, we will be able to see which universities were able to find their niche in order to survive in an environment that is about to change radically, and which ones were left behind.

Photo from Unsplash

The threat – Global competition in online education

Over the past three months, universities around the world have had to react to the COVID pandemic, shutting down their campuses and moving teaching online. It was a forced, impromptu change in response to the global emergency. Most quickly shifted their activity to videoconference platforms such as Zoom or Teams, doing online what was previously done in the classroom.

Although this doesn’t seem like a particularly big change, it overcame an enormous barrier in the use of technology in education, both by students and teachers. Above all, it changed perceptions, making it acceptable to take classes online, whereas before this was seen as a second-rate education. Now that these barriers have been overcome, we will see in the near future a big change in technological teaching formats, as well as increased international competition.

But don’t confuse the Zoom version of traditional classes with quality digital teaching.

A friend made the most of quarantine by taking a month-long online course with Harvard, coordinated by a famous professor, and in collaboration with CEOs of the biggest companies in the world. The learning platform is, according to him, “simply fantastic”, allowing for lots of interaction, discussion of cases and even cold calling. And, in the end, he received a properly framed Harvard diploma. The assessment and corresponding certification are very real.

Who is going to take a course at a second-rate university when they can do it at Harvard for a reasonable price?

All of this for just $1,100 – a very low price for a month-long, practically full-time, executive programme – and with more than 700 students around the world taking the course simultaneously. The price that this scale allows is unbeatable compared to the traditional “live” alternative.

Given this, who is going to take a course at a second-rate university when they can do it at Harvard for a reasonable price?

This is an example of executive training that, very soon, will be extended to undergraduate and postgraduate degrees, and offered to students around the world. And the most prestigious universities will be well positioned to take advantage of this opportunity: having globally recognised brands and the resources to invest.

Online education experiences have been continuously improved, with innovations in assessment methods, virtual internships, and practical simulations of laboratory classes. And the world of online education will continue to quickly evolve in the coming years.

Who knows, maybe Harvard will decide to partner with Netflix to improve the production of their online content? Or with LinkedIn in order to reinforce the networking component? Or with Microsoft in order to develop immersive formats using virtual reality?Photo from Unsplash

Creating good content for a quality digital experience requires a large initial investment, but afterwards, it is greatly scalable: it can be offered to a large number of students around the world, at a low price. Second-tier universities will struggle to compete with the online formats of prestigious universities who may be working in collaboration with Big Tech.

As well as traditional universities, we will also see new players entering the market. For a monthly subscription fee, Coorpacademy provides an online catalogue which includes more than one thousand multi-lingual, up-to-date courses from top providers, available at any time. In Spain, “The Power MBA”, attracted 35,000 students in two years. Not even regulations present an insurmountable barrier, as Hyper Island, an innovative school in Sweden - but present across three continents - navigated the lack of administrative flexibility in its country by offering degrees certified by an English university, a country where the certification of new degrees, masters and postgraduate courses is more flexible.

And as for the relevance of qualifications, the reality is that there are alternative, credible solutions for validating expertise that replicate the role of university diplomas. This can be seen in what LinkedIn is starting to do through its certification tool, launched at the end of 2019.

In Portugal, many universities operate as “professors’ unions” that aim to maintain the current model, either because are risk averse or to minimise the effort involved in changing.

Traditional universities will have to find new innovative ways to face these threats. They will have to find the will and ability to experiment. And they will have to overcome countless barriers that limit their ability to adapt. Higher education is a closed environment, protected by strict regulation that greatly limits flexibility when it comes to recruiting students, updating content, and investing in different teaching methods. In Portugal, for example, the agency A3ES only acknowledges higher education courses that follow the traditional format in terms of contact hours, student-teacher ratio, exams, etc., which makes innovation practically impossible. Moreover, the very governance model of universities does not encourage the creation of a differentiating strategy. Many universities operate as “professors’ unions” that aim to maintain the current model, either because are risk averse or to minimise the effort involved in changing.

All of these barriers create very unfavourable conditions for the evolution of traditional universities, and every day, endanger their long-term survival. We have already seen this happen in other industries. In addition to Blockbuster, Kodak and Nokia were also very strong companies who disappeared in the face of a technological interference. All too often organisations only make changes “in extremis”, when change is too late to allow them to face the new competitors that occupied the market in the meantime.

In this context, it is not difficult to predict that many traditional universities will come to loose students and feel pressure over the fees that they charge. Many will even disappear. Only those able to reinvent their face-to-face learning experience in a way that justifies the difference in price when compared with the better online offers will prosper.

The solution – transformational education

The strategy of these universities involves investing in the physical, experiential, face-to-face component of education and avoiding global competition in the online market as much as possible.

We recently saw an urban intervention campaign in Lisbon by Tomaz Castelão, JetFighterTom, with the title “Online, Offline”, warning that online life cannot replace the richness of “onlife” life. Universities should reflect deeply on this fact. Learning is an extremely social affair, but in order to compete with the online alternative, universities need to make big improvements in their face-to-face learning experiences.

By this we don’t mean returning to the traditional format of classes and exams - a relic of the past, when this was the only possible format - but deeply rethink the pedagogy and, above all, the ways in which technology can be used to improve students' face-to-face learning experience.

The teaching formats that guarantee the development of future skills are both experiential and experimental, personalised and self-paced, collaborative and creative, accessible and inclusive, and aim to develop skills throughout life. These are the teaching formats that prepare people for a future of continuous change, capable of rapid integration in complex communities and in search of solutions to problems that have not yet been identified.

An example of how education can be reinvented is 42, a school with an alternative educational model where students learn with their peers, developing real projects, supported by an innovative technological platform which manages progress by developing skills, integrating different learning rhythms, supporting collaboration between the students and encouraging continued motivation.

In the industry, 42 is already considered the best coding school in the world, having expanded to almost 20 countries in 5 years. Employers value the great entrepreneurial capacity, ability to work in teams and flexibility that students from this school demonstrate in their integration into the real world of work.

This school’s model is different in many ways. First, in its philanthropic nature, whereby students don’t pay tuition fees as the school is entirely funded by sponsors. It’s also an inclusive school that is open to everyone and doesn’t impose restrictions based on prior training: anyone can apply, regardless of their previous academic qualifications, and selection is based on a month-long bootcamp that assesses not only the working ability and problem solving skills of the candidates, but also their motivation and collaborative attitude.

42’s model demonstrates the possibility of a new face-to-face training structure that simultaneously promotes the acquisition of knowledge and the development of essential skills for the future.

Finally, the teaching method is extremely innovative. It’s a school with no classrooms, but a series of challenges for the students, giving them the responsibility to learn whatever is necessary to overcome them. This means the students must develop great autonomy, as well as the ability to work in groups. The platform that directs this course of study progresses in levels, awards points and badges, and groups the students into tribes that work together and compete. Essentially, it has all the elements of a computer game, which motivates students and allows them to manage the pace of their progress.

42’s model demonstrates the possibility of a new face-to-face training structure that simultaneously promotes the acquisition of knowledge and the development of essential skills for the future.

It prepares students for the new challenges of the world of work, ensuring that they learn by completing projects designed in partnership with potential employers, with development and approval rules that simulate reality. Instead of teachers giving classes, there is an educational team that continuously improves the students' learning path.

It encourages responsibility and entrepreneurship, motivating students to define their own learning path and pace. It guarantees that students will know how to learn continuously, without fear of the unknown, forcing them to seek new knowledge to solve the challenges they face, to collaborate with each other and to challenge themselves to go further, adding to what each one knows. In this way, the students build the foundations for an attitude of lifelong learning and collaborative innovation.

42 demonstrates how technology allows us to go further in face-to-face training than the traditional teaching model of classes and exams. And soon it will be possible to go even further. Either by capturing real-time data that allows for precise adjustments to be made to each student's individual learning experience, boosting their productivity and impact; through the creation of immersive learning environments, using voice technologies, virtual reality, games and simulation; or by developing flexible, interactive and creative spaces, which ensure greater effectiveness, a willingness to learn and collaborative interaction.

Obviously, it is much better to watch a well-produced video class, with rewind and fast forward, than to attend a class in a lecture theatre of 300 students and a professor writing on the board far in the background.

Photo from fortune.com

If well executed, the physical experience will continue to have greater transformative, creative, and collaborative power than the purely online experience. But this is not true if universities choose to simply go back to the past. Obviously, it is much better to watch a well-produced video class, with rewind and fast forward, than to attend a class in a lecture theatre of 300 students and a professor writing on the board far in the background.

Changing the university will require resources and an entrepreneurial spirit, with the courage to experiment with new formats and the ability to overcome barriers to innovation. In the end, the transformation will depend on the ability of universities to anticipate the competitive pressure they will experience in the near future and to resist the comfort of the status quo. At the end of the day, the transition will depend on universities’ capacity to anticipate the competitive pressure that they will face in the near future, and their ability to resist the comfort of the status quo.

Improving their face-to-face, experimental, and transformational education experience and avoiding the trap of purely digital competition will be the best bet for universities that want to survive and thrive in the next decade.