Would You Give Someone £10,000 to Do Nothing for You

The Open University in the UK is a fascinating experiment that by and large has gone well. Your colleagues and friends may be working on OU degrees. Academics take OU courses. People in traditional industries take OU courses. I like OU because it has served people who otherwise might not get degrees. No, it is not perfect, but in my view makes the grade as a University. 

I like the University of Phoenix less. I wanted to like the University of Phoenix, but cannot. I like Kaplan Higher education less. I like EDMC less. None of these imitators lives up to OU. Why don’t I like them? I don’t like them because they are inefficient. Let’s look at the balance sheets for OU, University of Phoenix, Kaplan Higher Education (as presented by the Washington Post financial reports), and EDMC (look to the bottom right of the page). 

Let’s also make a quick stop to look up today’s exchange rate: $1.56/£1. This is relatively close to the $1.6/£1, I have used previously. 

I don’t like the US for-profits and like the OU because...

... the OU taught 246,626 students and had a net income of £453.6 Million with approximately 57% from government teaching grants. They had an operating surplus of £37 Million. This is £1839/student. For OU we have another bit of information: the 246,626 represents 86,173 full time equivalent students. Using this number, you will get £5263/student. Note: I could not find FTE information for the others. 

... the University of Phoenix taught  380,800 students and had a net income of £2,842.1 Million ($4,322,670,000). This is £7463/student.

... Kaplan Higher Education taught approximately 74200 students[i]  and had a net income of £897.2 ($1,399.6 Million). This is £12,091/student.

... EDMC taught  142,100 and had net income of £1769.9 Million  ($2,760,967,000). This is £12455/student.

Would you sign up for OU and send £2,000 (lowest estimate) to £10,000 to one of these bloated money wasters for doing nothing for you? Of course you wouldn’t.

Any questions?

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[i] Note: I find the Washington Post Financial report quite vague about the number of students. The number here may be somewhere from 5800 too low to 24,400 too high. See pages 13 and 14 of the 2011 statement. The 2012 statement was not available at time of writing.