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The per-pupil cost of educating a student through virtual education is significantly less, on average, than the national average for brick-and-mortar schools, a paper from the Thomas B. Fordham Institute says. The report also says that fully virtual programs are less expensive, on average, than blended-learning programs, which combine face-to-face and online learning, but the paper does not address whether student outcomes are equal.

This is the season when many high school seniors are applying to and awaiting decisions from colleges and universities. It's an exciting time for those of us in higher education. We are reminded that learning is a lifelong pursuit. We are energized by the ideas and ambitions of our students. While we are excited about the prospects of a new freshman class, the economic downturn of the last three years has exposed and amplified our society's skepticism about the value of higher education. Yes, people still want to go to college, but there are growing concerns about student debt and unemployment after graduation. Students worry about their return on investment. Institutional leaders worry about hiring and retaining effective faculty and administrators, and about the constant cost of maintaining physical and technological infrastructures. Like the auto and newspaper industries, American higher education needs to innovate and reinvent itself if it's going to survive, thrive, and recapture its earlier glory. Industries that do not recognize the need for transition-or that do not manage that transition with agility-are likely to fail.

"Venture Fund for Traditional Colleges January 17, 2012 - 3:00am By Doug Lederman The space between nonprofit and for-profit higher education gets a little more crowded today. University Ventures Fund, a $100 million investment partnership founded by a quartet of veterans of the for-profit and nonprofit education sectors, is the latest entrant in a market that aims to use private capital to expand the reach and impact of traditional colleges and universities. The fund, whose two biggest investors are the German media conglomerate Bertelsmann AG and the University of Texas Investment Management Company, is focused on stimulating "innovation from within the academy," rather than competing with it from the outside, David Figuli, a lawyer and partner in University Ventures, said in an interview Monday. The projects will include helping institutions expand the scale of their academic programs, re-engineer how they deliver instruction, and better measure student outcomes; the first two investments, also announced today, will be creating a curriculum through Brandman University aimed at improving the educational outcomes of Hispanic students, and a company that helps universities in Britain and elsewhere in Europe deliver their courses online. "Most of the attempts to bring about innovation in higher education have come from people trying to buy their way in," Figuli said, citing the many takeovers of traditional institutions by for-profit colleges over the last decade (quite a few of which he helped engineer). "Our way is to find good ideas within the existing institutions and fund those." Figuli, a former general counsel for the South Dakota and Montana university systems, said he and his partners don't buy the critiques of traditional postsecondary institutions as unimaginative or fearful of change. "I've been in higher education for 30-some years, and most of the nonprofit institutions I've worked with have been frustrated by the fact that they're capital-constra

"Sebastian Thrun Resigns from Stanford to Launch Udacity Written by Sue Gee Monday, 23 January 2012 16:07 Professor Sebastian Thrun has given up his Stanford position to start Udacity - an online educational venture. Udacity's first two free courses are Building a Search Engine and Programming a Robotic Car. Attendees at this year's DLD (Digital Life,Design) , Conference being held in Munich, Germany and livestreamed around the world, were probably expecting to hear Sebastian Thrun say something of Google's Driverless Car project, but instead that was only covered in the session introduction. (See video below for the full presentation.) DLDTalkThrun Instead Thrun's talk, University 2.0, was devoted to the idea of online education, in particular the experiences and consequences of delivering the Online AI class. As Thrun also explains on his homepage: One of the most amazing things I've ever done in my life is to teach a class to 160,000 students. In the Fall of 2011, Peter Norvig and I decided to offer our class "Introduction to Artificial Intelligence" to the world online, free of charge. We spent endless nights recording ourselves on video, and interacting with tens of thousands of students. Volunteer students translated some of our classes into over 40 languages; and in the end we graduated over 23,000 students from 190 countries. In fact, Peter and I taught more students AI, than all AI professors in the world combined. This one class had more educational impact than my entire career. Speaking at DLD12, Thrun gave other interesting contrasts between the real-world class and the online one: there were more online students from the small country of Lithuania there on all the courses at Stanford combined and while no Standford student had a perfect score on the course, 248 online students scored 100% - i.e completed the assignments and exam question without a single wrong answer. Something that I don't think he should be as proud about i

"Udacity and the future of online universities By Felix Salmon January 23, 2012 The most exciting (but also, in a small way, slightly depressing) presentation at DLD this year came from Sebastian Thrun, of Stanford and Google. Or formerly of Stanford, anyway. Thrun told the story of his Introduction to Artificial Intelligence class, which ran from October to December last year. It started as a way of putting his Stanford course online - he was going to teach the whole thing, for free, to anybody in the world who wanted it. With quizzes and grades and a final certificate, in parallel with the in-person course he was giving his Stanford undergrad students. He sent out one email to announce the class, and from that one email there was ultimately an enrollment of 160,000 students. Thrun scrambled to put together a website which could scale and support that enrollment, and succeeded spectacularly well. Just a couple of datapoints from Thrun's talk: there were more students in his course from Lithuania alone than there are students at Stanford altogether. There were students in Afghanistan, exfiltrating war zones to grab an hour of connectivity to finish the homework assignments. There were single mothers keeping the faith and staying with the course even as their families were being hit by tragedy. And when it finished, thousands of students around the world were educated and inspired. Some 248 of them, in total, got a perfect score: they never got a single question wrong, over the entire course of the class. All 248 took the course online; not one was enrolled at Stanford. Thrun was eloquent on the subject of how he realized that he had been running "weeder" classes, designed to be tough and make students fail and make himself, the professor, look good. Going forwards, he said, he wanted to learn from Khan Academy and build courses designed to make as many students as possible succeed - by revisiting classes and tests as many times as necessary u

"A Disrupted Higher-Ed System January 26, 2012, 2:40 pm By Jeff Selingo The "disruption" of the higher-ed market is a popular refrain these days. Rising tuition prices and student debt have left many wondering if the current model is indeed broken and whether those like Harvard's Clay Christensen are right when they say that innovations in course delivery will eventually displace established players. What exactly those innovations will look like remains a matter of debate. One view from Sheryl Sandberg, chief operating officer of Facebook, envisions a future in which every industry will be disrupted and "rebuilt with people at the center." In this recent interview with The Wall Street Journal, Sandberg talked specifically about the gaming industry, which has been upended by the popularity of social-gaming venues, such as Words With Friends and Farmville. But what if we applied her people-centered vision to higher ed? While amenities and services on campuses have been redesigned in the last decade with students clearly at the center, the core of the academic experience for students today is almost exactly the same as it was for their parents decades ago. While other industries have been able to find productivity gains without sacrificing quality, on most college campuses we still have professors at the front of a room or at a table with an average of 16 students in front of them. We all know that's one of the key drivers of rising college costs. Higher ed is people intensive, and for many prospective students and their parents, the professor-centered academic experience is well worth the high price and will be for a long time. It's one reason why high-quality institutions really have little to worry about. But we also know that the traditional academic experience isn't for everyone these days. The students we used to call "nontraditional" are now a majority, yet we have way too many colleges chasing after high-achieving 18-to-24-year-olds

"Alan Jacobs - Alan Jacobs is the Clyde S. Kilby Professor of English at Wheaton College. He blogs at ayjay.tumblr.com. The Great Unbundling of the University By Alan Jacobs Jan 23 2012, 2:14 PM ET 14 The bundle of knowledge and certification that have long-defined higher education is coming apart, but what happens now? Felix Salmon tells the story of how Sebastian Thrum was so overwhelmed by the success of his online Introduction at Artificial Intelligence course -- 160,000 students enrolled! -- that he decided to quit teaching at Stanford and start his own online university, where he'll begin by teaching the people who sign up how to build a search engine. Well, how cool is this? There are about a thousand things I could say about this development, but let's boil it down to the essentials. For a long time now, universities have flourished by offering a bundled package of knowledge and credentialing. People attended university in order to learn stuff that they couldn't learn elsewhere -- because the experts weren't elsewhere -- and to be certified by those experts as having actually learned said stuff. The bundle has been a culturally powerful one. But now: unbundling. Clearly, many universities have come, or are coming, to the conclusion that their primary product is the credentialing, and that they can give knowledge away either as a public service or as brand consolidation (choose your interpretation according to your level of cynicism). Those 160,000 students may have learned a great deal about artificial intelligence, and the successful ones received a "statement of accomplishment ... sent via e-mail and signed by Sebastian Thrun and Peter Norvig." But in announcing the course the instructors were careful to note that the "statement of accomplishment ... will not be issued by Stanford University." The big question for universities going forward is this: Can control of credentialing last for long without control of knowledge? If a great many people learn

"January 23, 2012 Invisible Gorillas Are Everywhere By William Pannapacker By now most everyone has heard about an experiment that goes something like this: Students dressed in black or white bounce a ball back and forth, and observers are asked to keep track of the bounces to team members in white shirts. While that's happening, another student dressed in a gorilla suit wanders into their midst, looks around, thumps his chest, then walks off, apparently unseen by most observers because they were so focused on the bouncing ball. Voilà: attention blindness. The invisible-gorilla experiment is featured in Cathy Davidson's new book, Now You See It: How the Brain Science of Attention Will Transform the Way We Live, Work, and Learn (Viking, 2011). Davidson is a founder of a nearly 7,000-member organization called Hastac, or the Humanities, Arts, Sciences, and Technology Advanced Collaboratory, that was started in 2002 to promote the use of digital technology in academe. It is closely affiliated with the digital humanities and reflects that movement's emphasis on collaboration among academics, technologists, publishers, and librarians. Last month I attended Hastac's fifth conference, held at the University of Michigan at Ann Arbor. Davidson's keynote lecture emphasized that many of our educational practices are not supported by what we know about human cognition. At one point, she asked members of the audience to answer a question: "What three things do students need to know in this century?" Without further prompting, everyone started writing down answers, as if taking a test. While we listed familiar concepts such as "information literacy" and "creativity," no one questioned the process of working silently and alone. And noticing that invisible gorilla was the real point of the exercise. Most of us are, presumably, the products of compulsory educational practices that were developed during the Industrial Revolution. And the way most of us teach is a relic of the s

"Online course start-ups offer virtually free college By Jon Marcus, Published: January 21 An emerging group of entrepreneurs with influential backing is seeking to lower the cost of higher education from as much as tens of thousands of dollars a year to nearly nothing. These new arrivals are harnessing the Internet to offer online courses, which isn't new. But their classes are free, or almost free. Most traditional universities have refused to award academic credit for such online studies. Now the start-ups are discovering a way around that monopoly, by inventing credentials that "graduates" can take directly to employers instead of university degrees. "If I were the universities, I might be a little nervous," said Alana Harrington, director of Saylor. org, a nonprofit organization based in the District. Established by entrepreneur Michael Saylor, it offers 200 free online college courses in 12 majors. Another nonprofit initiative is Peer-to-Peer University, based in California. Known as P2PU, it offers free online courses and is supported by the Hewlett Foundation and Mozilla, the company behind the Firefox Web browser. A third is University of the People, also based in California, which offers more than 40 online courses. It charges students a one-time $10 to $50 application fee. Among its backers is the Clinton Global Initiative. The content these providers supply comes from top universities, including the Massachusetts Institute of Technology, the University of California at Berkeley, Tufts University and the University of Michigan. Those are among about 250 institutions worldwide that have put a collective 15,000 courses online in what has become known as the open-courseware movement. The universities aim to widen access to course content for prospective students and others. At MIT, a pioneer of open courseware, half of incoming freshmen report that they've looked at MIT online courses and a third say it influenced their decision to go the

Washington Post Change.org emerges as influential advocate on issues from bullying to bank fees By Ylan Q. Mui, Published: January 23 Ben Rattray knows that revolution does not always happen spontaneously. The 31-year-old entrepreneur rattles off a list of populist actions over the past year: the consumer revolts against Bank of America's and Verizon's unpopular fees, a drive to enlist the San Francisco Giants to speak out against anti-gay bullying, a petition forcing the South African government to address the rape of lesbians. Each campaign won thousands of supporters, inflamed public opinion, and drew the ire of corporate executives and political leaders. But these were not impromptu rebellions that chanced upon success. They were carefully nurtured by Rattray's fledgling company, a social media site called Change.org that has emerged as one of the most influential channels for activism in the country. "We're in the business of amplifying," Rattray said in an interview. "We're trying to change the balance of power between individuals and large organizations." Rattray said his firm is profitable and hopes to bring in tens of millions of dollars in annual revenue within a few years. It makes money by running campaigns for advocacy groups such as Amnesty International in exchange for a fee. Ordinary users can create an online petition for free. The company, which has headquarters in the District and in San Francisco, has exploded over the past year, growing from a staff of 20 to about 100, with offices around the world. Though originally conceived as a nonprofit, Change.org is now part of an emerging group of "social benefit corporations," such as Patagonia, that seek to both make money and do good. Fueling Change.org's rise is the wave of global unrest that has given birth to other viral movements such as Occupy Wall Street. But Rattray calls these movements "radically under- optimized." They have no leaders and no coordinated mi

"Tenured Professor Departs Stanford U., Hoping to Teach 500,000 Students at Online Start-Up January 23, 2012, 4:53 pm By Nick DeSantis The Stanford University professor who taught an online artificial intelligence course to more than 160,000 students has abandoned his tenured position to aim for an even bigger audience. Sebastian Thrun, a professor of computer science at Stanford, revealed today that he has departed the institution to found Udacity, a start-up offering low-cost online classes. He made the surprising announcement during a presentation at the Digital - Life - Design conference in Munich, Germany. The development was first reported earlier today by Reuters. During his talk, Mr. Thrun explored the origins of his popular online course at Stanford, which initially featured videos produced with nothing more than "a camera, a pen and a napkin." Despite the low production quality, many of the 200 Stanford students taking the course in the classroom flocked to the videos because they could absorb the lectures at their own pace. Eventually, the 200 students taking the course in person dwindled to a group of 30. Meanwhile, the course's popularity exploded online, drawing students from around the world. The experience taught the professor that he could craft a course with the interactive tools of the Web that recreated the intimacy of one-on-one tutoring, he said. Mr. Thrun told the crowd his move was motivated in part by teaching practices that evolved too slowly to be effective. During the era when universities were born, "the lecture was the most effective way to convey information. We had the industrialization, we had the invention of celluloid, of digitial media, and, miraculously, professors today teach exactly the same way they taught a thousand years ago," he said. He concluded by telling the crowd that he couldn't continue teaching in a traditional setting. "Having done this, I can't teach at Stanford again," he said. One o

"January 24, 2012 Colleges Can Take 4 Steps to Assure Quality, Group Says By Dan Berrett Increasing the percentage of college graduates in the United States has become a collective aspiration of policy makers, advocates for higher education, and President Obama. But this push for quantity will mean little if colleges cannot demonstrate the quality of the degrees they confer, says an advocacy group. The group, the New Leadership Alliance for Student Learning and Accountability, released today a set of guidelines it says will help colleges assess and improve student achievement and, in the process, better demonstrate the quality of their offerings. The guidelines are being presented at the Council for Higher Education Accreditation's annual meeting in Washington, with endorsements from 27 organizations, chiefly accreditors and associations. The guidelines stake out four broad principles of assessment and accountability for a college to follow: setting ambitious goals for the outcomes of undergraduate education; gathering evidence about how the institution is faring in pursuit of those outcomes; using that evidence to improve learning; and sharing the results. The essential idea is to clearly articulate and make intentional the objectives that guide student learning, said David C. Paris, executive director of the alliance. "That's our goal," he said, "an evidence-based profession." The alliance was started in 2009 by several higher-education leaders and foundations to respond to growing calls for accountability in the sector. The assumption was that colleges needed to define how they would substantiate student learning-or lawmakers would do it for them. The new guidelines expand on the alliance's previous efforts, including a statement of principles to guide student learning, which were released in 2008, and a pledge by more than 100 college presidents to take steps at their institutions that are largely identical to the ones set out in the new guidelines. O

"January 22, 2012 States Push Even Further to Cut Spending on Colleges By Eric Kelderman For nearly four years, governors and state legislators have focused on little else in higher education but cutting budgets to deal with historic gaps in revenue. Now, with higher-education support at a 25-year low, lawmakers are considering some policy changes that have been off-limits in the past, such as consolidating campuses and eliminating governing boards. Such proposals reflect the reality that, in most states, money for higher education will be constrained for the foreseeable future. Systems in Georgia and New York have already taken the unusual step of combining campuses under a single president. Other states, such as Ohio, are talking about giving institutions more freedom from state regulations, although for college administrators there's a trade-off: They would get more flexibility but even less state money. On the agenda in many statehouses this year will be bills that would tie higher-education appropriations to the completion rates of students at public colleges. Such performance-based models, which have had a mixed record in recent decades, are again popular with lawmakers trying to squeeze the most out of every tax dollar and to reward colleges that are more efficient at producing graduates. Related Content State Support For Higher Education Falls 7.6% in 2012 Fiscal Year Calif. Governor Goes After For-Profits With Limits on Cal Grants Legislators aren't demanding that colleges be more cost-efficient just to reduce spending on higher education, says Travis J. Reindl, a higher-education researcher for the bipartisan National Governors Association. They also want to keep colleges affordable for students. "We'll still be talking about money, money, money," Mr. Reindl says of the legislative sessions ahead. "Governors are increasingly interested in how the money is being spent by higher education ... and how much of that money is going to come out of

"January 22, 2012 MIT Mints a Valuable New Form of Academic Currency James Yang for The Chronicle By Kevin Carey The Massachusetts Institute of Technology has invented or improved many world-changing things-radar, information theory, and synthetic self-replicating molecules, to name a few. Last month the university announced, to mild fanfare, an invention that could be similarly transformative, this time for higher education itself. It's called MITx. In that small lowercase letter, a great deal is contained. MITx is the next big step in the open-educational-resources movement that MIT helped start in 2001, when it began putting its course lecture notes, videos, and exams online, where anyone in the world could use them at no cost. The project exceeded all expectations-more than 100 million unique visitors have accessed the courses so far. Meanwhile, the university experimented with using online tools to help improve the learning experience for its own students in Cambridge, Mass. Now MIT has decided to put the two together-free content and sophisticated online pedagogy­-and add a third, crucial ingredient: credentials. Beginning this spring, students will be able to take free, online courses offered through the MITx initiative. If they prove they've learned the materi­al, MITx will, for a small fee, give them a credential certifying as much. In doing this, MIT has cracked one of the fundamental problems retarding the growth of free online higher education as a force for human progress. The Internet is a very different environment than the traditional on-campus classroom. Students and employers are rightly wary of the quality of online courses. And even if the courses are great, they have limited value without some kind of credential to back them up. It's not enough to learn something-you have to be able to prove to other people that you've learned it. The best way to solve that problem is for a world-famous university with an unimpeachable reputat

"January 23, 2012 Outlook for Higher Education Remains Mixed, Moody's Says By Scott Carlson In a report released on Monday, Moody's Investors Service sticks with the mixed outlook for higher education that it established last year: For leading colleges that are well managed and diversified, the market is looking stable. For the rest, not so much. The outlook report, which is released annually at the beginning of the year, says that a majority of colleges-those dependent on tuition or state money-will continue to face challenges in the next 12 to 18 months. Those challenges will, in part, stem from the public's scrutiny of rising tuition and from pressures to keep it down. Analysts at the credit-rating agency also expect demand to rise for admission to the largest and highest-rated institutions, while other colleges may struggle to attract students. The Occupy protests and other events have put intense focus on college tuition. "Tuition levels are at a tipping point, and the cost of college will be a critical credit factor for universities to manage long-term," the report says. "We expect that the pace of future net tuition revenue growth, both on a total and a per-student basis, will be much lower than the strong growth experienced over the past 10 years." A declining yield in admissions is troubling trend, the report notes. Many colleges may appear more selective, but only because more students are applying to more colleges. "Median freshman yield rates (percentage of accepted freshmen who chose to enroll) at both private and public universities have steadily declined over the past five years, highlighting increased competition," the report says. "The trend of declining yield is particularly notable for the lower-rated private colleges, which are increasingly competing with lower-cost public colleges and feeling the most pressure to slow tuition increases and offer more tuition discounting." Demand for some graduate and professional programs, particularly

"January 23, 2012 State Support for Colleges Falls 7.6% in 2012 Fiscal Year By Eric Kelderman Higher education's oracles and prognosticators began warning of a "cliff" in state appropriations shortlyafter the $767-billion federal economic-recovery act passed, in 2009. Now data show just how high that cliff was. Total state support for higher education declined 7.6 percent from the 2011 to the 2012 fiscal years, according to an annual report from the Grapevine Project, at Illinois State University, and the State Higher Education Executive Officers. As a whole, state spending on higher educa­tion­-after being supported by the recovery-act money for three budget years-is now nearly 4 percent lower than it was in the 2007 fiscal year. Twenty-nine states appropriated less for colleges this year than they did five years ago. The current year's large decline was due in part to the expiration of about $40-billion in federal money given to the states to prop up spending on education. While a number of states are now seeing improvements in their economic forecasts, their economies had not recovered enough by July to allow officials to replace the lost federal dollars. Factoring out the federal stimulus money, state support for colleges declined a little more than 4 percent from 2011 to 2012. The overall decline is also a result of the big drop in higher-education spending in Cali­fornia, accounting for more than a quarter of the total decrease in state support. Related Content States Push Even Further to Cut Spending on Colleges Calif. Governor Goes After For-Profits With Limits on Cal Grants California's impact underscores the wide variations in support for higher education across the states. Not including the federal stimulus, state spending for higher education fell more than 13 percent in California, and New Hampshire slashed more than 41 percent from its higher-education budget in 2012-the largest percentage decline in the nation. But Montana ra

"Online Course Provider, StraighterLine, to Offer Critical-Thinking Tests to Students January 19, 2012, 12:29 pm By Jeff Selingo As alternatives to the college diploma have been bandied about recently, one question always seems to emerge: How do you validate badges or individual classes as a credential in the absence of a degree? One company that has been hailed by some as revolutionizing introductory courses might have an answer. The company, StraighterLine, announced on Thursday that beginning this fall it will offer students access to three leading critical-thinking tests, allowing them to take their results to employers or colleges to demonstrate their proficiency in certain academic areas. The tests-the Collegiate Learning Assessment, sponsored by the Council for Aid to Education, and the Proficiency Profile, from the Educational Testing Service-each measure critical thinking and writing, among other academic areas. The iSkills test, also from ETS, measures the ability of a student to navigate and critically evaluate information from digital technology. Until now, the tests were largely used by colleges to measure student learning, but students did not receive their scores. That's one reason that critics of the tests have questioned their effectiveness since students have little incentive to do well. Burck Smith, the founder and chief executive of StraighterLine, which offers online, self-paced introductory courses, said on Thursday that students would not need to take classes with StraighterLine in order to sit for the tests. But he hopes that, for students who do take both classes and tests, the scores on the test will help validate StraighterLine courses. StraighterLine doesn't grant degrees and so can't be accredited. It depends on accredited institutions to accept its credits, which has not always been an easy task for the company. "For students looking to get a leg up in the job market or getting into college," Mr. Smith said, "t

"Cracking Open the Scientific Process Timothy Fadek for The New York Times A GLOBAL FORUM Ijad Madisch, 31, a virologist and computer scientist, founded ResearchGate, a Berlin-based social networking platform for scientists that has more than 1.3 million members. By THOMAS LIN Published: January 16, 2012 Recommend Twitter Linkedin comments (145) E-Mail Print Single Page Reprints Share The New England Journal of Medicine marks its 200th anniversary this year with a timeline celebrating the scientific advances first described in its pages: the stethoscope (1816), the use of ether for anesthesia (1846), and disinfecting hands and instruments before surgery (1867), among others. Science Times Podcast Subscribe This week: Opening science and doing it yourself, plus the malaria medicine of Chairman Mao. Podcast: Science Times Related Wordplay Blog: Open Science, Numberplay style! (January 16, 2012) When Breakthroughs Begin at Home (January 17, 2012) RSS Feed RSS Get Science News From The New York Times » Enlarge This Image Timothy Fadek for The New York Times LIKE, FOLLOW, COLLABORATE A staff meeting at ResearchGate. The networking site, modeled after Silicon Valley startups, houses 350,000 papers. Readers' Comments Readers shared their thoughts on this article. Read All Comments (145) » For centuries, this is how science has operated - through research done in private, then submitted to science and medical journals to be reviewed by peers and published for the benefit of other researchers and the public at large. But to many scientists, the longevity of that process is nothing to celebrate. The system is hidebound, expensive and elitist, they say. Peer review can take months, journal subscriptions can be prohibitively costly, and a handful of gatekeepers limit the flow of information. It is an ideal system for sharing knowledge, said the quantum physicist Michael Nielsen, only "if you're stuck with

"Pulling for Better E-Textbook Prices January 18, 2012 - 4:50am By Steve Kolowich In a session at the 2011 Educause conference in October, Bradley Wheeler, the chief information officer at Indiana University, issued a challenge to his colleagues. Unless universities assert their power as customers, the vendors that sell them products and services will continue squeezing those institutions for cash while dictating the terms under which they go digital. That conversation revolved around expensive, institution-level investments such as learning-management platforms and enterprise resource planning software. Now Wheeler and his colleagues are looking to apply the same principles of "aggregated demand" to help students save money on electronic textbooks. Internet2, a consortium of 221 colleges and universities, which last year brokered landmark deals with Box.com and Hewlett-Packard that gave its members discounts on cloud computing services, announced today that it had entered into a contract with McGraw-Hill, a major textbook publisher, aimed at creating similar discounts for students on digital course materials. Students have less ability than universities to pool their power as consumers, says Wheeler. The ascendance of e-textbooks means, among other things, that the secondary market for used books -- the one area where students can exercise power over textbook pricing -- could soon disappear. Universities would do well by their students to exercise leverage on their students' behalf, Wheeler says. "If somebody [does not] speak up for students in the move from print to digital, the students [are] going to get killed," he says. Beginning this month, five major universities - the University of Wisconsin at Madison, the University of Minnesota-Twin Cities, the University of Virginia, Cornell University, and the University of California at Berkeley -- will start a pilot program in which certain courses will use only electronic texts. The texts will be a

"University Ventures Letter Volume II, #2 Announcing University Ventures Thirty years ago America was an economic basket case. The official unemployment rate in 1982 exceeded 10%, but apples-to-apples unemployment (counting it the way we do today) was over 16%. Inflation was north of 6% and the prime interest rate reached 21.5% in June 1982. Things weren't much better in the UK where deindustrialization had resulted in unemployment over 20% in many regions, and where the 'workshop of the world' became a net importer of goods for the first time ever. It's always darkest before the dawn. So few recognized we were on the verge of a revolution in information technology that would drive productivity increases across almost all industries and create new ones over the next two decades. If there's any consensus at all in today's debate about how to rekindle economic growth, it's the importance of education, and particularly higher education. We need more educated workers to innovate and increase productivity. Not coincidentally, the largest industry that has not seen much in the way of productivity improvements since 1982 is education. All but a handful of the 170 million students currently enrolled at tertiary institutions around the world are learning the way their parents and grandparents learned (often learning virtually the same curriculum). The 'sage on a stage' model remains unchanged, and the well over $1 trillion in annual spending on higher education continues to be directed to the same functions. And so the stage (if not the sage) is set for the world to focus on higher education as it never has before, and for dramatic changes in programs, delivery models, costs and learning outcomes. While the private sector will play a key role in this next revolution, it cannot succeed alone. Traditional universities and colleges - public and private -- will be the crucibles of change, in partnership with entrepreneurs and companies. The