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	<title>Comments on: Online Classes As Cash Cows</title>
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	<link>http://diyubook.com/2011/05/online-classes-as-cash-cows/</link>
	<description>Edupunks, Edupreneurs, and the coming transformation of higher education</description>
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		<title>By: Michael Feldstein</title>
		<link>http://diyubook.com/2011/05/online-classes-as-cash-cows/comment-page-1/#comment-4919</link>
		<dc:creator>Michael Feldstein</dc:creator>
		<pubDate>Wed, 25 May 2011 03:14:18 +0000</pubDate>
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		<description>Well, it&#039;s not that simple. 

On the cost side of the equation, the more accurate way to put it is that online course costs scale better than F2F. Early investments in online courses are typically money losers, because there&#039;s a fair bit of fixed cost plus startup cost that gets spread out over only a few classes. But as the number of enrollments ramps up, the costs don&#039;t ramp at the same rate. You don&#039;t have more classrooms to clean and heat, more security guards to hire, and so on.

On the price side, what&#039;s true is that state schools often charge out-of-state tuition for online courses. The in-state/out-of-state thing is one of those weird analog constructs that translates awkwardly into the digital world, but I certainly wouldn&#039;t call it price gouging. 

You can add to this the fact that many states cap the number of F2F students that a college can take, both because they can&#039;t afford the capital expenses of expanding the physical plant and because every in-state student is subsidized by the taxpayers (though by far less than they should be). Since online learning has neither of these limitations, state schools are able to accept many more online students. Which lowers the cost per student, because of the scaling thing, which actually brings money into the college. 

Far from being price gouging, what we have here is a virtuous cycle that should be lauded and encouraged. It infuses the schools with badly needed cash while increasing access to education by adding available seats. Even out-of-state tuition can be a relatively good deal, depending on the state. It&#039;s not an ideal solution, to be sure, but it is a net positive.

When 80% of an article demonstrates a slanted view of a person with an axe to grind, it&#039;s probably best not to take the remaining 20% at face value--particularly when no verifiable facts are cited.</description>
		<content:encoded><![CDATA[<p>Well, it&#8217;s not that simple. </p>
<p>On the cost side of the equation, the more accurate way to put it is that online course costs scale better than F2F. Early investments in online courses are typically money losers, because there&#8217;s a fair bit of fixed cost plus startup cost that gets spread out over only a few classes. But as the number of enrollments ramps up, the costs don&#8217;t ramp at the same rate. You don&#8217;t have more classrooms to clean and heat, more security guards to hire, and so on.</p>
<p>On the price side, what&#8217;s true is that state schools often charge out-of-state tuition for online courses. The in-state/out-of-state thing is one of those weird analog constructs that translates awkwardly into the digital world, but I certainly wouldn&#8217;t call it price gouging. </p>
<p>You can add to this the fact that many states cap the number of F2F students that a college can take, both because they can&#8217;t afford the capital expenses of expanding the physical plant and because every in-state student is subsidized by the taxpayers (though by far less than they should be). Since online learning has neither of these limitations, state schools are able to accept many more online students. Which lowers the cost per student, because of the scaling thing, which actually brings money into the college. </p>
<p>Far from being price gouging, what we have here is a virtuous cycle that should be lauded and encouraged. It infuses the schools with badly needed cash while increasing access to education by adding available seats. Even out-of-state tuition can be a relatively good deal, depending on the state. It&#8217;s not an ideal solution, to be sure, but it is a net positive.</p>
<p>When 80% of an article demonstrates a slanted view of a person with an axe to grind, it&#8217;s probably best not to take the remaining 20% at face value&#8211;particularly when no verifiable facts are cited.</p>
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