Posted by: Gillian | August 25, 2010

For profit and not-for-profit universities

Ask if a ‘for profit’ university is any good and the reactions tend to be strong.  Ask if ‘university X’ is any good and, regardless of incorporation status, reactions become more considered.  Why?  What’s the problem?


Swanning around in felt slippers in your tutor’s house to protect specimen hardwood floors (Nachsommer, Stifter) may be wonderful but it does not pay the council tax.  So, what can be done?

Some see the need to make university learning a route to employability and, therefore, paying council tax as so essential that specific industry skills are incorporated into the curriculum and detailed knowledge is required of “current” practices.  (The currency may be questionable as degrees typically take two years to get from design to delivery.)  These courses are easily standardised and do not need all-knowing tutors.  The needs and desires of many can be met at less cost.

In terms of money, others prefer to see research as a social-economic requirement.  If ‘our’ country is not on the leading edge of exploration then our society will not be as we desire.  Research has no deadlines or syllabi. It is never ‘done’ because there are always refinements, spin-offs, questions. Oops, that makes it hard to cost.  That means some for-profits will have trouble convincing their shareholders.  That, in turn, means it is easier for for-profits to focus on employment-related programmes.

Use of profit

A big assumption in the for-profit v not-for-profit argument is that not-for-profit means money goes into frontline teaching instead of grubby shareholders’ pockets.  Leaving aside the emotions of grubby shareholders and philanthropic investors, it is simply not true that old not-for-profit institutions automatically put more money into frontline teaching.  Buildings (often ancient or unfit for current purpose) need maintaining, traditional methods of academic consultation need to be respected, collections need housing.  More controversially, old universities often genuinely find it harder to limit the travel and conference budget than do new universities with no entrenched practices and expectations.

Confusing Online and Profit

Many people assume online/distance institutions are for profit and real campuses are not.  That’s not so.  Taking UK examples, the Open University is not-for-profit and classroom attendance is not normally required whilst for-profit BPP requires classroom attendance for its degrees.  Internationally, other for-profits use non-profit campuses to deliver courses (e.g. Kaplan). Many universities of both types use both campus and off-campus methods (e.g. Curtin, Delhi, Full Sail, Rasmussen, London, Heriot-Watt, Texas).   The delivery method is not a determining factor of commercial status.

Confusing Private and Profit

Private education – as opposed to State subsidised/funded – is often understood to be for-profit education when, in fact, many such institutions are not-for-profits, just like their State counterparts.  That is the case, for example, with Britain’s only private university: the University of Buckingham.  One of the interesting things about that institution is that it provides a traditional UK three-year degree in two very concentrated years.

Building required?

There is another confusion related to campuses.  In the early days of internet education, it seemed that every self-respecting institution that ventured into it was obliged to have pictures of (preferably old) buildings on its welcome page just to prove it was a real university not an office block.  The UK Open University, rather oddly, has gone the other way round.  It started by being a non-traditional ‘no university’ university and now has a massive campus mostly full of staff, not students. No prime-photo-site football pitch for them – but it still costs money.

Requiring attendance in a real building is another sign of market-place confusion.  Phoenix, one of the for-profit non-traditional giants, is primarily online/distance-learning but requires campus attendance for its ‘distance’ PhD program(me)s. Strange, if you believe that many modern academics collaborate extremely productively across the globe without touching hands. Strange if you take into account the cost of a month’s distance supervision of a doctoral student compared to a week on campus.  Yet not so strange if you come from a tradition where doctorates have to be earned by daily obeisance to a tenured Professor over 3-5 years.  Being for-profit and breaking completely with tradition is not so easy if a qualification is to be accepted by the extant norm.

Knowledge or socialisation

For the 18-year-old in the West, going to university is still a rite of passage.  As costs for tuition and living spiral, the rite may be losing some of its widespread magic but it exists. The young can go and ‘be students’ for three or four years and not be held accountable for any social experiments, while their parents can be relieved it is all happening away from home and is simultaneously delivering a degree.  Society lives on.  This style of learning is not currently well served by for-profit institutions.  Turnover rates matter.  The for-profit market is ideally suited, however, to goal-centred learning and also to consolidation or accreditation of prior learning because both parties understand the value of time.

Badges and logos

Both for profit and not for profit universities regularly seek external recognition. Why any university should pay for three expensive external agencies other than their main national/regional body to accredit a business course rather than apply the funds to teaching is quite beyond me; but they do! If your profession requires, say, ABET recognition, then look for it and be sure it applies to your specific course.  Other than that – and legitimate degree status – exercise your own judgement and remember that someone, somewhere, is paying.

Speed of qualification

This is a rarely-used marketing line because, traditionally, it sounds unacademic and, therefore, suspect. Not-for-profit institutions tend to talk about fast tracks for people with relevant knowledge or fast tracks for people prepared to put in extra weeks-per-year (e.g. University of Buckingham). For-profits talk about annual tuition fees and do not restrict the number of courses per year.  Many in either category will allow accreditation of prior experience/skills and learning or ‘credit accumulation and transfer’.  There are some interesting international developments emerging here but the profit/non-profit distinction is not relevant.  What the student needs to watch is the cost of APEL compared to time saved.

Research and tenure

If your ultimate aim is to be a full professor at a top research university, it is probably fair to say your best starting point is not a mass-market online Western for-profit university – but it probably isn’t your local rural not-for-profit, either.  There are still universities that refuse to interview potential researchers and professors from outside restricted groups of universities.  In their defence, some need to restrict their large applicant list somehow but academic snobbery and resistance to change do exist.  If you are not happy being the maverick, then you probably still need a traditional not-for-profit post-graduate degree.

The verdict

If you know why you want a degree, you can make a much more rational decision about the type of university you want.  Provided the university or college is recognised in your state or national system or in the UNESCO list it does not matter whether it is for profit or not for profit.  Time to completion can be a lifestyle choice.  Online or traditional is often a course-by-course matter rather than a whole-institution state.  What works for you in the long term is far more important than 2010 tax-based definitions of institutional status.


  1. Terrific article. I think people confuse for-profit and online because for-profit did online first and do it best. Traditional academia simply bashes online while quietly implementing programs of its own. Some argue that the paradigm of education is shifting from a lecture based system to a discourse based system. The irony is that it is done more effectively online. There is no “hiding in the back” online. There is no waiting until the end to “cram” online. Unfortunately, there is no doubt about the stigma attached to online and for-profit specifically.

    Most studies on the subject demonstrate that online is the equal or superior method of delivery. Unfortunately some for-profit institutions allow entrance to people who are not in a position to be successful. About this I have mixed feelings as I think everyone has a right to give it a shot but this does provide the traditionalist some argument. I think the stigma of online will disappear (and is disappearing) and it will be up to the individual institutions whether the stigma of “for-profit” disappears.

    I have been exposed to both traditional and online environments. I have a JD from a traditional top-ten school and am pursuing a PhD at a for-profit online. I have also taught in traditional schools and online. I am excited about the unlimited potential for online education in bringing affordable education to all, providing continuing opportunities for the lifelong learner and opening the “classroom” to diverse people and viewpoints from around the world.

    Best Regards,

    • Robert, your observations are very much in line with my own. It’s interesting that you are doing an online PhD. Did you feel more able to take the (diminishing) risk of that because you already had a traditional JD or was that not really part of your thinking? Do keep in touch.

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