The Dark Side of StraighterLine’s Professor Direct Program

StraighterLine’s new “Professor Direct” program claims to empower teachers by allowing them to set their own prices for courses. As Paul Fain of Inside Higher Ed puts it, “‘self-employed professor’ could soon be an actual job title.” Over at The Chronicle of Higher Education, Jeffrey Young has written a piece that also seems to suggest the positive implications of Professor Direct. Young points out that the program “lets instructors determine not only how much to charge for such courses, but also how much time they want to devote to services like office hours, online tutorials, and responding to students’ e-mails.” It all sounds nice, but the problem is none of this is true.

StraighterLine has come up with some very clever PR that paints them as heroes in the quest to solve both the student access problem and also the problem of the adjunct labor crisis–basically the two big issues that keep popping up in higher education discussions these days.

But that’s all it is–PR and marketing. All Professor Direct does is exacerbate both of these problems by oversimplifying the issues and creating a lowest common denominator bidding war that, if left unchecked, will completely dismantle American higher education.

Seeing Through the Money With Professor Direct

Photo: Harvard Graduate School of Education

Professor Direct is Not Good For Adjuncts

First, let’s look at StraighterLine’s claim that they are empowering adjuncts. According to the company, teachers set their own prices for the courses they teach. Think about that, though. The most basic law of market-driven economics is sales are determined by demand. A merchant can set any price he chooses, but that has nothing to do with the sales that price point will generate. In the free market, consumers determine the price, not the vendors.

Teachers aren’t setting their own price any more than a dairy farmer sets his own price for milk. Sure, a teacher can value her course at what she considers to be a living wage, but if the consumer isn’t willing to pay that price, then the teacher’s valuation essentially means nothing. In a market-driven economic exchange, the consumer sets the price. Despite the spin StraighterLine is attempting to place on Professor Direct, this program has nothing to do with empowering the teacher and everything to do with applying free market principles to higher education, which gives the consumer the ability to determine value, whether or not that consumer has any frame of reference for establishing that valuation.

Now, let me explain what I mean by that. I’m not anti-market or anti-consumer choice. In fact, I generally welcome opportunities for consumers to push back on corporations that would price-gouge if they could.

Most “products” have a clear and present value that’s recognizable to the consumer pre-purchase. When we buy a gallon of milk, we know exactly what we’ll be getting. In other words, there’s no hidden value associated with that product. We won’t realize ten years from now that our gallon of milk actually changed our lives in some unforeseen way.

Same thing even with most professional exchanges. The value proposition is clear. If I have a broken bone, I know exactly what the doctor will do to fix it. If I am being sued, the value proposition in which I engage with my attorney is relatively understood. I will give him a certain amount of money and he will attempt to win my case. Once my transactions with this doctor and lawyer are complete, we move on with our lives. Here again, there really is no chance for any hidden value or any future compounding of the service I received in exchange for my payment. Both the professional and I can agree on a fee and be pretty confident exactly what we will both gain from the transaction.

And then there’s education. How many of you can say that at 18 years old, you knew exactly what value you would receive from each class you took in college?

It’s just not possible. We can’t possibly negotiate a fair market price for education because we have no idea what hidden value lies in the information we will gain from a given course. Often we don’t realize until semesters or even years later how much value we actually received from a course we took.

Therefore, the teacher has diminished leverage in negotiating the value of her course because that value is not immediately demonstrable. The student (understandably) just wants to pay as little as possible for the course, and without a definitive reference point for valuation, the courses will certainly receive a diminished valuation to the detriment of the professor.

Unless StraighterLine is planning to encourage students to give a retroactive tip to the professor five years later, there’s just no way this Professor Direct program is good for the teacher.

The False Minimum

One more point about the potentially destructive nature of Professor Direct and other programs like it. At first, I was encouraged by the fact that StraighterLine has set a minimum price point of $49 for students. I thought, “Okay, they’re establishing a failsafe that insures against a nasty bidding war amongst professors. At least everyone is still guaranteed a living wage even in the worst case scenario.”

Yeah, not so fast. That $49 minimum is just StraighterLine’s take. They’re, of course, just covering their own interests. That means a professor could charge $50 for a course and make only a buck a student. I don’t want to go too far down this reductive path, but I do want to throw out a couple of potentially serious problems with this scenario. I mean, the free market has a tendency to take things to the absolute extreme, so it’s worth considering.

What if a couple of financially-comfortable retired teachers or professionals decide to teach a few massive classes for $1 a head? Good for them and good for the students I suppose, but what about all those teachers who couldn’t possibly compete with that price point? They’re just left high and dry, I guess. “Thanks for all your hard work and sacrifice for the good of the country; we don’t need ya anymore.” What happens when these professors move on? If education is already in disaster mode, what might happen if its market value starts to swing wildly from year to year and tuition rates become volatile?

And one more thing: How about if StraighterLine starts hiring professors who live in other countries with much lower costs of living than the United States? Can our teachers compete in a global bidding war? Will our English classes eventually be taught entirely by non-native speakers? Hey, it’s just a thought. I’m warning everyone who reads this that the free market will push everything to its illogical conclusion.

How Can We Make the Professor Direct Model a Win-Win?

While this new Professor Direct program might seem good on the surface, it’s a trap wrapped in smooth PR. It encourages irresponsible practices like overloading courses, giving minimal feedback to students, and awarding high grades in exchange for positive course reviews (ie. marketing). Rather than giving power, it actually strips power by reducing education’s value down to that which can be accomplished most cheaply. And, in order to compete in this free market educational economy, teachers are forced to subscribe to the system’s flawed and incomplete metric for determining value. It ignores education’s delayed return on investment and assigns the burden of valuation to a consumer who has at best an incomplete picture of the eventual value proposition.

Programs like Professor Direct, in their current incarnation, will destroy the greatest educational system in the world if we don’t force some checks and balance onto them. One place I would start is to establish a minimum course cost that still allows all teachers a reasonable living wage. That way, even if a bidding war erupts (and it will), education still holds a viable and consistent market value that benefits both the student and the teacher.

What are your thoughts on Professor Direct? How might we adapt this first attempt in order to make it more sustainable and less destructive?

See Also: Why We Should Pay Teachers Like the Professionals They Are

  • http://TheNewFacultyMajority.blogspot.com Vanessa Vaile

    Alas, it’s too late (or early) to reply at length, let alone coherently (later then), but it could also devolve into a pyramid scheme with the emphasis on recruiting students. Do student get a fee break for recruiting other students too? And so on down the slippery slope…

    • Josh Boldt

      Good point, Vanessa.

  • Joey Gary

    1. Don’t Students win here? – real college credit at prices they can afford. (Unlike Udemy, Udacity, Coursera, you actually get college credit at StraighterLine.)
    2. Your article is a giant “Capitalism is bad” argument.
    3. Higher education is already broken, if we don’t allow for innovation what would happen? Your argument is non-unique, as the squo already leads to the impacts you describe.

    • Josh Boldt

      1. The only way students win with this model is if you believe that saving money is all that matters. Students will get credit for cheaper. That’s true. But the education they will receive barely even resembles the college experience that, for the last fifty years, has defined America as the global front runner in higher education. People all over the world want to be educated at an American school because of the integrity represented in an American degree. With programs like these “credit auctions” our educational integrity will be wiped out.

      2. I wouldn’t necessarily say that capitalism is automatically bad, but I do have a big problem with the way it attempts to impose a monetary value on every single thing it encounters, and then tries to extract as much of that value as possible in any way necessary. It’s a short-sighted way to live and it will eventually collapse on itself just like we saw with the banking industry.

      3. I actually agree with you here. We can’t keep things the same, but my argument is that this isn’t the whole answer. We need to find a more balanced approach that opens the market for a little competition while also still planning for a long term sustainable future.

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  • E

    As someone in a similar line of business, I can see where your concerns lie but I think something to keep in mind is that the target audience here might not just necessarily be the 18 yr old student in need of a degree/accreditation for taking classes. There are other market segments in continuing education and professional development that might find this useful. They don’t have to be stuck in a pretentious continuing education program paying abhorrent fees, the majority of which go to a bloated administration when they could be directly adding value to the teacher’s bottom.

    A lot of these people actually care a lot about the quality of these courses because they are not necessarily looking at the accreditation so much as they are trying to get knowledge from these courses. Tom Vander Ark gives a very detailed description of this demographic here : http://gettingsmart.com/cms/blog/2012/10/the-learning-design-opportunity-our-time/ For this demographic, cost is not as much of a problem because they work and a $120 course isn’t a huge sacrifice for them to get ahead at work and in life with skills they need to grasp – so long as it is done properly.

    That said, again, I can see your point. Marketplaces for education like Straighterline have the effect of sparking bidding wars and this could be really destructive for higher education as you have observed (since it presents more of an effect where cost as opposed to quality is the primary consideration).

    One of the things we are thinking about at Bookneto is whether tying online courses more tightly to the teacher’s brand (whether by enabling them put the course on their website – as opposed to a market place) might enable them better differentiate on the basis of quality. That or working with guilds of teacher’s in a specific domain area to prominently endorse quality courses in their specific field. I don’t have all the answers yet but those are some of my thoughts.

    You can check out my startup here : https://angel.co/bookneto

    Always happy to converse with teachers!

    • Josh Boldt

      E,

      Your argument is reasonable and well-taken. I do agree with your point that older working professionals would benefit greatly from a program like this one. I’m concerned this is a kind of gateway that, once cracked, will eventually open the floodgates. Once we go down this road of auctioning off education to the lowest bidder, I’m afraid we won’t be able to go back–even if we decide later that we made a mistake.

      I don’t see how we can offer a good education with academic rigor and integrity for $120 a course. The math doesn’t add up. Even if you gave the teacher 80% of the tuition, it still wouldn’t be enough to convince any serious professor to go to school for 10 years and become an expert in his or her field. It will work for a little while because there is a glut of PhD’s in the market right now, but eventually this strategy will collapse.

      I foresee a world where, ten years down the road, we’ve bankrupted most of our higher learning institutions and we’ve created a learning model that isn’t financially sustainable. That’s what worries me.

      So, I’ll counter your proposition by saying that I do see some merit in it, but we’ve got to figure out a way to keep future teachers interested in entering the field of education. What if companies like StraighterLine and Bookneto set course prices and then gave professors a percentage of tuition? Even $200-$300 per course would be much cheaper than now. The professor could get 75% and the company could take 25%, or something like that. Seems like everyone could win in a scenario like that.

      • E

        That’s a fair suggestion. The only problems I see are the bad actor problem (students will flock to whatever platform is cheaper but will teachers do the same too? – remember we don’t have exclusivity over the teacher’s content.) and the fact that we will be drawn into content curation which is every technology company nightmare (we have to make sure all the courses on our platform are worth $200-$300 which is tough when you are 21 years old and have 0 expertise in their specific discipline.)

        Now that said, I think your perspective might be coloured by how you see the market place evolving. I used to think like that but experience has humbled me. Correct me if I am wrong but I think your fear is that there will be a scenario where institutions of higher learning no longer exist and all we have to rely on for the education of young people is a couple websites like straighterline powered by competing professors simply because it is cheaper and easier to learn on a website than in class. Right? I don’t think this will be the case.

        Here are a couple reasons why from an insider :

        1. We really have no idea who is *actually* taking the course and the tests. No one will ever trust *credentials* gained online to those gained in a four year in person University because sites like this exist : http://boostmygrades.com/
        http://www.wetakeyourclass.com/

        There is no way to guarantee academic integrity online

        2. Student experience is still better in class. Despite all the hype around online education, students still overwhelmingly prefer to go to class in person. The only reason online education is becoming more important is that the internet introduces infinite scale and it is just stupid expensive on both sides to attempt infinite scale in person. But there goes academic rigor. It is impossible to have the same inclass rigor online.

        3. Research funding will keep institutions alive. They have to generate those doctors somehow. I think as corporates begin to fund more and more research in institutions, research as a revenue source will be more stable too.

        There are more where that came from.

        So what is likely to be the end game?

        I don’t think higher education institutions will be bankrupted. Like hospitals, they will always exist. But just like private doctor’s offices and clinics exist today, I think there will be more professors operating independently of the school setting for the most part. The young kids will still go to higher education but when they fail a course or they are 60 and they need a course refresher or two, they will go directly to the professor to keep things cheap. The professor’s mainstay will still be his pay from the school but websites like our or straighter lines will replace his “consulting” revenue.

        So you are right, it is impossible to sustain a good education with academic rigor and integrity for $120 a course but I don’t think any honest actor will tell you this is the goal here – especially when the medium is online learning. You get what you pay for.

        Happy to hear your thoughts on this

        • Josh Boldt

          the fact that we will be drawn into content curation which is every technology company nightmare (we have to make sure all the courses on our platform are worth $200-$300 which is tough when you are 21 years old and have 0 expertise in their specific discipline.)

          That’s exactly the problem with educational entrepreneurship. Most of the companies involved have no desire to actually take a vested interest in the educational process. It’s just a way to make money. Education is not a market for speculation. It is much too valuable and important.

          I don’t begrudge a guy for trying to make a buck. Not at all. In fact, I encourage it. But educational innovation needs to be directed by those who know it best.

          I believe you when you say your goal is benevolent. What concerns me is that the goal of the market is not benevolent. Capitalism always reduces everything to that which can be done cheapest and most efficiently. Bookneto might do things right, but the company that comes just after you have opened the door will undoubtedly have less honorable intentions. Once this starts, it won’t stop.

          I realize it’s not fair for me to ask you and those like you to halt your business model (nor is it likely), so instead I’m just asking you to have foresight. Plan long term. How can you make your business work for everyone involved? Paying teachers a couple hundred bucks a class is not acceptable. It is exploitative, short-sighted, and wrong. It might make the company a few bucks, but it does not leave the world a better place. If the goal is to make a positive impact, we have to figure out how to create a fair system that will continue to benefit teachers, students, and the American educational system.

          • E

            I don’t think its fair to say educational entrepreneurs don’t want to take a vested interest (past creating tools I assume) in the education process because it is all about profit for them. Like I pointed out, sometimes it is because they actually care a lot and they don’t want to f*ck it up. Unlike many of the noise makers who have time to frolick with VC’s and in conferences as opposed to run a business etc, some of us know our place and are content in it.

            At Bookneto, we are humble about what we are. We won’t change education ourselves but we can enable teachers do so. We can give great teachers incredible scale and compensate them very well for sharing their knowledge. We can give teenagers on the other side of the world (in African countries like Nigeria barely 40% of qualified candidate can attend school because there are literally no places) a chance at learning and parents who need to *not* get fired a new lease of knowledge life. The rise of the oceans won’t slow and the world may never heal but I’m happy if we change even just one life on either side of the student teacher relationship.

            We haven’t even publicly launched and I already know we’ve changed several lives.

            The first course on our platform (venturestart.ca) generated over 250k in revenue for the professor who started it. Students paid a fair $1,700 to get the course and the prof was entrepreneurial enough to get government support for his course so it was a condition for its $30,000 STEM start funding. Lots of student benefited from the knowledge in the course and they got government support for their ventures. Many of them are growing like weed. Its amazing. I see lots of opportunity for entrepreneurial educators to do the same in literally every profession where continuous professional development is becoming more and more part of the job description (law, insurance, management, finance, etc)

            As for the companies coming after me, you are right. There will always be scum bags in this industry. But remember, there are currently scum bags in this industry – the forprofit colleges and the administration of Universities. They are ripping off both teachers and students. They pay adjuncts just enough to live and leave students with high hopes of a degree that might change their life when all they really need is a course or two to get them to the next level. Many of them drop out, heavily indebted. It is a tragedy. The fact that there is a better way is what drives me to get up every morning to go to work because I know the world would be a better place if we can create something that works even a little better. Will future scum bags emerge in this industry when it is successful? Yes. But mark my words, when they emerge, they will be disrupted for their scheming practices because consumers can choose. That’s the beauty of capitalism.

            Any way, enough of my speech. Let’s talk solution.

            Here is something I think should happen. Online professors need to create some sort of industry specific guild to protect their interests. Don’t leave it to up edu entrepreneurs. Our incentives don’t always align.

            Imagine if say people who taught English online on platforms like professor direct came together and said “let’s all charge a base of ____ for our courses”. If you join our guild and charge that, you get a badge on your course and students who take your course qualify for X related perk (say it counts as credit in all our colleges). Anyone outside this guild doesn’t get the same perk. Students know they could be getting fleeced in these market places and seeing the guilds’ badge is a mark of authenticity. This keeps prices where instructors need them to be, students happy to pay more to get guaranteed good service and entrepreneurs out of the curation business (where you really don’t want us to be trust me).

            Does this make sense? What do you think?

          • Josh Boldt

            I think that sounds like a good plan, but it also sounds like a smokescreen that allows companies to wash their hands of what I would consider to be the ethical responsibility of ensuring reasonable compensation to the people who make those companies succeed.

          • E

            Forgive my spelling and grammar errors. I haven’t had much sleep.

  • Scott Gustafson

    Let’s say I’m a good teacher that wants to monetize my comparative advantage. Professor Direct seems to offer a way for me to do that – on my terms, on my schedule, and at a rate that makes sense to me.

    What are you offering me as an alternative?

    • Josh Boldt

      I actually agree with you, Scott, but my concern is what if students won’t pay a decent rate for your course? If Professor X is offering it for cheaper, then why would they pay you more? So, you would end up having to drop your price to compete with Professor X. And then he would have to drop his price, and so on. There’s really no way this works out to be a good option for adjuncts.

      And while it may be a good short-term boon for students, it will bad when, a decade from now, most teachers have left the industry.

      Like I said in the piece, this model allows consumers to determine a valuation for something which they can’t possibly measure. If we come up with a model that sets a minimum and then splits that minimum with professors, then we’d be heading in the right direction. At least that way we could be sure professors wouldn’t have to price themselves into poverty in order to teach.

      • Scott Gustafson

        If Professor X is offering it for cheaper, the reason they would pay more for my class is because they recognize that I’m a better teacher. Right now I could probably get a premium of $20 to $50 a head for my classes if the school would let me.

        I reject your notion that students can’t make a good choice. They go out of their way to find the good teachers (and avoid the bad ones).

        With the advent of the internet, we listen to individual songs from artists rather than buying albums from record companies. Increasingly we read individual writers rather than publications. The future will be taking classes from great teachers rather then from institutions.

        • Josh Boldt

          Just to be clear, I’m not arguing that students can’t make a good choice. I’m arguing that the average student doesn’t have a frame of reference by which to determine a course’s value, which would likely result in a falsely low valuation.

          As for the rest of your argument, I hope you’re right…

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  • S.M. Stirling

    Ah, the ghost of the “just price” rises gibbering from its medieval grave…

    News flash: the just price is what you can get, in an unrestrained bidding war.