University Teaching as E-Business?
Research and Policy Agendas

Case Study: Universitas 21

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NB: These draft case studies, compiled by Shannon Lawrence, are an internal resource for the University Teaching as E-business? research project. Originally released in October 2001, they were updated in March 2002. They were gathered from numerous sources, including news articles, press releases, scholarly reports, and company websites. In many cases, information presented herein was taken directly from The Chronicle of Higher Education's longitudinal series of articles on Information Technology and Distance Education, which represents the single best source for information about this evolving universe.

Universitas 21 LBG1 is an international network of 17 research-intensive universities in Europe, North America and East Asia, including South East Asia and Oceania, founded in 1997. Collectively, its members enroll about 500,000 students each year, employ some 44,000 academics and researchers, and have a combined operating budget of almost $US9 billion. Fifteen of the 17 member institutions are also involved in U21Global, an online university created as a joint venture between Universitas 21 and Thomson Learning in September 2001.

Universitas 21 also has two incorporated subsidiaries, U21pedagogica and U21equity. U21pedagogica, drawing heavily upon the well-established internal quality assurance processes and expertise of Universitas 21 member institutions, provides quality assurance services to higher education under the direction of its Academic Standards Council.2 U21pedagogica, the exclusive provider of quality assurance services to U21 global, ensures that standards are maintained consistently with relation to admissions, course design, development, pedagogy and courseware, and assessment procedures. U21equity provides a corporate structure to manage the consortium's financial arrangements for U21global.

Products/Services

Founded in 1997, the consortium's original aim was to enhance collaboration in research and through staff and student exchanges. Another goal was to develop international benchmarks through a shared set of performance indicators. Currently, Universitas 21’s core business is providing a pre-eminent brand for educational services supported by a strong quality assurance framework. It offers experience and expertise across a range of vital educational functions, a proven quality assurance capability and high brand value. Universitas 21 has been established for the purposes of:

• Developing international curricula for graduates educated and trained to operate in a global professional workforce, with credentials that are internationally portable and accredited across a range of professional jurisdictions;
• Providing a quality assurance structure that operates globally to offer internationally valid processes for the enrollment, instruction, assessment and certification of students, and an internationally recognized brand identifiable with a global network of high quality universities;
• Providing partnership opportunities for major new providers, including corporate universities, wishing to access a fast-growing international market for higher education and advanced training;
• Bringing to such partnerships international recognition and legitimacy, premium higher educational branding, a demonstrable quality assurance capability, and a proven capacity for producing and delivering quality higher education and training programs.

As an incorporated entity, Universitas 21 is in a position to leverage the reputation, resources and experience of its members on behalf of corporate partners. Universitas 21 is therefore uniquely placed to address the cross-jurisdictional branding requirements of new educational providers.

U21global, on the other hand, is scheduled to begin operations in January 2003. It will initially concentrate on the M.B.A. market and other business-related postgraduate seeking students in Singapore, Malaysia, and Hong Kong, and will later attempt to attract students in Africa, China, and Latin America. Planners of U21global, which would offer courses for professionals, chose Asia as a starting point in part because students are brand-conscious, and thus will be receptive to online courses delivered by well-known universities in the consortium. The language of instruction will initially be limited to English, but will be extended to include Mandarin by 2003 and Spanish by 2006.

Thomson Learning and Universitas 21 will produce new curricula, courseware and delivery platforms designed specifically to deliver an effective e-learning experience. The courses will be delivered over the Internet, augmented by satellite television when necessary. Thomson Learning will be responsible for the course design, testing and assessment, and student-database management for the project. Universitas 21 will award degrees, diplomas, or certificates to students who complete course requirements. U21 global will not offer any course or accredit any award that has not been validated and endorsed by U21 pedagogica, an international quality-assurance agency established by the Universitas 21 universities to operate at arm's length from U21 global. Course offerings will receive multi-jurisdictional accreditation from the 15 Universities that are participating in U21global.

Governance

Universitas 21 functions as an equal partnership of its members (see Table 1). The number of members is limited to no more than 25 institutions. Membership of the Board of Universitas 21 is made up of the Managing Director of the Company and the Chief Executive Officers of the member institutions. A meeting of the Universitas 21 Board is held annually. The Executive Committee of Universitas 21 acts on behalf of the Board on the day to day operations of the Company between meetings of the Board. The current Chair of Universitas 21 is Professor Sir Graeme Davies, Vice Chancellor of the University of Glasgow. The Managing Director and Company Secretary is Dr. Chris Robinson.

Financing/Strategy

Universitas 21 had signed a memorandum of understanding in April 2000 with TSL Education Ltd., a British subsidiary of Rupert Murdoch's News Corporation, to establish a joint venture that would offer online graduate-level courses around the world. Microsoft was named as the "preferred third party" in the deal. At the time, the three groups planned to grab a major share of the rapidly expanding global higher-education market, but that deal fell through in November 2000.

After a year of negotiations, Thomson Learning and Universitas21 formed a joint venture in September 2001 to establish U21global, an online university. Each organization pledged $25 million in funding. In order to raise funds, Universitas 21 turned to its member institutions. Each of the 15 universities involved in U21global agreed to pay at least $500,000, with some institutions investing as much as $5 million. While most universities did not disclose the amounts they invested, the Universities of Glasgow, Melbourne, New South Wales, and Queensland are known to have specified the sums they intend to contribute. The three Australian universities have promised up to a total of $8 million, including $5 million from Melbourne. Glasgow has indicated it will put in up to $2 million.

The Asian-based venture will address the estimated $111 billion global demand for higher education by offering business and technology degrees via the Internet, starting in January 2003. Revenue of $500 million is projected by the 10th year for U21global, with the profits being split among Thomson Learning and the member institutions.

The challenge will be to provide relevant, accessible higher education of a consistently high quality to students who in many cases will have no access to conventional campus-based education. Participating universities were confident about the academic integrity and commercial viability of U21global.

The plan to set up an online institution in conjunction with Thompson Learning to market graduate courses alarmed some member institutions. Two institutions decided not to participate in the planned global online university. Among other issues member institutions cited were concerns about how the consortium would use their names and logos in issuing its own certificates and degrees. The University of Toronto, a founding member of the consortium, resigned from Universitas 21 altogether, and the University of Michigan system decided not to participate in U21global, although it remains a member of the consortium. Michigan representatives expressed concern that faculty would not be sufficiently involved in the development or assessment of courses, or the quality control of the venture's academic programs. They also stated that their educational interests would likely be better served through other ongoing elearning activities. Representatives from the University of Toronto indicated that the U21global project was moving too rapidly, and that the University of Toronto could not make the necessary policy decisions in time.

During negotiations with Thomson, a group of five faculty unions also complained about the speed of U21global's planning process, calling on the group to hold off on establishing the virtual university until all academic and employment issues had been resolved. The faculty unions sought clarification of issues of governance, intellectual freedom, quality assurance, and intellectual property, as well as financial arrangements surrounding the proposal. The president of the American Association of University Professors, Jane Buck, and the heads of unions in Australia, Britain, Canada, and New Zealand raised their concerns in a letter to the Universitas 21 chairman at the time, Alan Gilbert, Vice Chancellor of the University of Melbourne. The chief concern involves contracting out course design, content development, and testing and assessment to Thomson Learning, which are core academic tasks that should stay with faculty members.

References

• "Australian Students Object to Online-University Consortium." The Chronicle of Higher Education, 9 March 2001. http://chronicle.com/weekly/v47/i26/26a03902.htm
  
• Maslen, Geoffrey. "5 Unions Urge Caution on Universitas 21's Venture With Thomson." The Chronicle of Higher Education, 2 March 2001. http://chronicle.com/weekly/v47/i25/25a04002.htm
  
• Maslen, Geoffrey. "As Deadline Approaches, Universitas 21 Seeks Funds for Its Online Institution." The Chronicle of Higher Education, 30 May 2001. http://chronicle.com/daily/2001/05/2001053001u.htm
  
• Maslen, Geoffrey. "College Group Ends Talks With Murdoch's Company." The Chronicle of Higher Education, 24 November 2000. http://chronicle.com/weekly/v47/i13/13a05302.htm
  
• Maslen, Geoffrey. "Leery About Use of Their Names, Michigan and Toronto Opt Out of Universitas 21." The Chronicle of Higher Education, 25 May 2001. http://chronicle.com/weekly/v47/i37/37a03802.htm
  
• Maslen, Geoffrey. "Universitas 21 Announces Online-Education Agreement with Thomson Learning." The Chronicle of Higher Education, 22 November 2000. http://chronicle.com/daily/2000/11/2000112202u.htm
  
• "The Plans of Universitas 21" (Letters to the Editor). The Chronicle of Higher Education, 6 April 2001. http://chronicle.com/weekly/v47/i30/30b02101.htm
  
• "U21global Established as Premiere e-University: $US50 Million Joint Venture Between Thomson Learning and 15 Universities Worldwide" (Press Release). 5 September 2000.
  
• Young, Jeffrey R. "Universitas 21 Moves Forward With Plans for Online University." The Chronicle of Higher Education, 6 September 2001. http://chronicle.com/daily/2001/09/2001090601u.htm

Notes
1 Limited by Guarantee. Universitas 21 is incorporated in Guernsey, Britain.
2 The Academic Standards Council of U21pedagogica approves courses, subjects, templates, instruction and assessment, ensuring that each meets Universitas 21 quality standards.