Tuesday, April 16, 2024

Unbundling higher education

Free & Clear: January 2013

Unbundling higher education
By John Hood


When University of North Carolina leaders announced in September the formation of a committee to study the system’s strategic direction, the usual suspects said the usual things. Because it included business leaders and political conservatives, liberal critics cried foul. Because it included many current and former university employees, chancellors and board members, critics feared another bout of navel-gazing by academic insiders. Because it included only one sitting professor, faculty leaders warned of outsiders interfering in academic matters. Democrats questioned the presence of prominent Republicans. Republicans questioned the presence of prominent Democrats.

Perhaps an initial round of debate about the shape of the table was inevitable. Now can we call it a draw and move on to the real issues? The future of higher education in North Carolina is at stake, as is the growth and vitality of the state economy. The committee is studying issues concerning the design, costs and benefits of university programs. One way to ponder those questions is to pose this fundamental one: How should the UNC system respond to the Great Unbundling of higher education?

The death of the bundle is, by now, a familiar story. In communications, what used to be monopoly providers of telephony, cable television and mail delivery saw their lucrative bundles of services untied by technological and regulatory change. First, consumers gained the ability to choose from competing providers of long-distance phone service and package delivery. Then mobile phones and online service undercut the necessity of landlines, as email and social media did letters, and telephone and cable companies began invading each other’s turfs. One of the most profitable bundled services, Yellow Pages, went from indispensable tool to disposable doorstop.

The newspaper industry went through its own Great Unbundling. Before the online era, whether you were a job seeker after the want ads, a homebuyer after the real- estate listings, a cartoon fan after the funny pages or a sports fan after the box scores, you had to buy the entire bundle. Advertisers paid a premium for the privilege of placing their messages inside it. But once searchable websites and other tools broke up the newspaper bundle, the industry’s revenue model collapsed.

Unbundling is under way in a host of fields, many of them services such as the practice of law and delivery of medical care. Consumers are increasingly empowered to buy the level of service they need from the provider that best fits their needs. Much of the current angst in academia reflects the fact that its leaders and employees can see the Great Unbundling in their future — and it makes them nervous.

Since the founding of the modern public university, it has bundled many services into a single package: deliver-er and certifier of vocational and pro- fessional skills, job-search network, provider of cultural programming and sports entertainment, research lab and technology-transfer agent, economic developer and place where (mostly) young people can find themselves, find a mate and explore the great questions of life through thoughtful study of the liberal arts and social sciences.

It was an unwieldy and expensive thing, this modern university. Its continued existence as the ultimate bundler relied on a combination of guild monopoly, political power and public awe. But each of the traditional defenses has weakened. Businesses such as The Teaching Company LLC and, now, many of the nation’s top- ranked universities are delivering excellent academic content to learners at a low cost. Employers are demanding alternatives to bachelor’s degrees to certify what their potential employees know and what they can actually do. Today’s politicians are skeptical investors of tax money, a challenge for places such as UNC where the full, state-subsidized cost of educating a student has long exceeded the national average. As for public awe — well, skyrocketing tuition and plummeting ethical standards have done some pretty awesome damage to university reputations.

Unbundling higher education, if done the right way, may end up benefiting professors who value the “life of the mind” more than they realize. If the system can give those who just want post-secondary vocational preparation or job placement a faster, less-expensive way to get such services, that would allow those who seek a real university education — to grapple with the Great Books, to write poetry, to sample anthropology, to master string theory for its own sake — an opportunity to pursue their dreams unfettered by the need for campuses to enroll and remediate unprepared, uninterested students.

Taking the current bundle of services, offering it to more students and forcing taxpayers to foot most of the bill is not a strategic plan. Here’s hoping UNC’s advisory committee understands that and aims higher.

John Hood is chairman and president of the John Locke Foundation. You can reach him at

For 40 years, sharing the stories of North Carolina's dynamic business community.

Related Articles