Thursday, April 25, 2002
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Report From Columbia University's Senate Sharply Criticizes Spending for Online VentureBy MICHAEL ARNONE
A critical report from Columbia University's Senate says the university should cut back spending on its for-profit online-learning venture, Fathom, and should encourage the company to develop content from Columbia and other partners in the Fathom consortium, instead of creating material on its own. But the company's president says that Fathom must be judged as a work in progress, and that its spending has already been cut. The report, from the Online Learning and Digital Media Initiatives Committee of the University Senate, states that Fathom has "failed to identify and capture a market segment sufficient to warrant the resources dedicated to [it]." The report continues: "It is difficult to thus justify the expense of producing new online content, especially when it is completely separate from the instruction offered in Columbia's traditional degree programs." Fathom, now two years old, is an independent company created and primarily financed by Columbia. It offers noncredit and for-credit courses and other content developed by faculty members at institutions that belong to its consortium, including the London School of Economics and Political Science, the University of Chicago, and the New York Public Library. In 2001, Columbia gave Fathom $14.9-million -- $11.9-million for operating expenses and $3-million for research and development. The company made $700,000 from fees from other institutions and sales revenue. Ann Kirschner, Fathom's president, defended her company. "Fathom's value to the university is both strategic and, in the long term, will be financial as well," she said in an e-mail message. "As we proceed with careful allocation of resources, speed to profitability has to be balanced with the requirement to be consistent with the mission and values of the university." Ms. Kirschner said Fathom is already following the course suggested in the report. "Columbia reduced its financing of Fathom to basic operations in January, 2001," she said. "There were layoffs as well as a sharper focus on meeting basic strategic objectives. Fathom has focused on core services to its consortium members since then." The University Senate is a policy-making body made up of faculty members, students, administrators, alumni, and staff members. Its online-learning committee was formed last year to investigate concerns about where Fathom was heading, but it soon expanded its mandate to look at all the online-education ventures Columbia is supporting, said Herve Varenne, a committee member who is a professor of education at the university's Teachers College. The report comes at the midpoint of the committee's two-year examination of online learning at Columbia, he said. Despite the hard words about Fathom in the report, the company isn't the focus of the committee's energies, said Mr. Varenne. The report says that all of Columbia's online-education efforts should focus on the university's core academic mission, he said. The committee also believes that the university should support online-education efforts by its own departments and schools before financing outside companies such as Fathom, he said. The committee said it realized that few start-ups make money, that Fathom's technology platform is useful, and that the company's Web site showcases Columbia to a wider audience. The committee also said it believed that Fathom hasn't been successful because the company doesn't coordinate with traditional academic departments. Fathom also develops online tools that have little benefit for the rest of the university, the committee said, adding that the company's efforts should be better integrated into Columbia's overall online strategy. "If Fathom is not going to be a profit center in the short to medium term, then it should either enhance the university's other online initiatives or reinforce its core missions of research and the dissemination of knowledge," the report says. The report suggests five ways of improving Fathom's performance, including having Fathom rethink its long-term business model and seek additional financial support from its consortium partners. "The committee correctly identifies Fathom's core mission as furthering the aims of the faculty," said Ms. Kirschner. She said the company doesn't create its own content, but instead packages content made by instructors at its member institutions. Fathom has been working to increase its market presence and the value of the consortium, Ms. Kirschner said. Last week, the company announced a partnership with America Online, the nation's largest Internet provider. Fathom's courses and content are now featured on AOL's Online Campus, a distance-education portal for AOL subscribers. Fathom also recently signed the British Museum up as a new consortium partner.
Background articles from The Chronicle:
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 Supreme Court hears arguments on whether students can sue colleges under privacy law University presidents promote cloning techniques for research but not to create human babies Report accuses Virginia law schools of bias against non-black applicants U. of North Carolina at Chapel Hill abandons early-decision admissions Mount Senario College will fold at summer's end Central Missouri State agrees to $300,000 settlement with former president Fort Valley State U. reaches settlement with former student-newspaper adviser Wake Forest U. medical school adds Spanish-language requirement Virus prompts Greece to close universities this week Spring commencement speakers are announced by 19 colleges E-store opens in United Arab Emirates to sell computers to students Report from Columbia University's Senate sharply criticizes spending for online venture |
Copyright © 2002 by The Chronicle of Higher Education