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At New Online University, Advertisers Will Underwrite Free Degrees

An online degree-granting institution called World Education University, set to open this fall, plans to try an advertiser-driven model to support its free content.

“Any Silicon Valley start-up will tell you that if you can drive enough eyeballs to your Web site, you can find ways to leverage that and monetize it,” said Scott Hines, the university’s chief executive. “We’re very transparent to students. They understand that their education is being underwritten generally through advertisers.”

Advertisers will pay for students to answer survey questions related to their products. For example, students may be asked a question like “Are you a runner?” when they log into the learning-management system. If a student checks “yes,” he or she will thereafter see ads for a certain brand of running shoes on the home page.

World Education University will also allow companies to publicly sponsor students, who will then be told about the connection. According to Mr. Hines, that approach is attractive to advertisers because it will help to build brand loyalty early.

A third main source of financial support will derive from a points system. Students will receive points for performing well academically or completing certain courses. They will then be able to redeem the points for prizes and services offered by partner advertisers. Mr. Hines said that other revenue models include fee-based tutoring and charging for premium content.

The university plans to offer 120 to 150 courses in areas such as art history, psychology, and business administration. Although it plans to develop its own content instead of forming partnerships with existing universities, Mr. Hines said that the initial course materials—such as videos and syllabi—are being provided by two colleges with which the university has confidentiality agreements. The colleges want to help his university, Mr. Hines said, but wish to remain anonymous because they are afraid of retribution from accreditation agencies.

Accreditation is a struggle for World Education University, Mr. Hines said, because “the accreditation system right now is not real supportive of innovation.” The university is seeking accreditation from national, regional, and international bodies, including ones recognized by the U.S. Department of Education, he said. The university is also interested in creating a competency-based accreditation model, in which corporate partners accredit the university as properly preparing students for their industry.

[Creative Commons licensed Flickr photo by captcreate]

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