Is Higher Education Nearing the Tipping Point?
Why Worldwide AI Regulation May Be Another Nail in the Coffin
Higher education institutions have deeply embedded value in society and have survived, adapted, and thrived for centuries. They don’t die easily. But the pressure is building higher than ever before, as AI continues to spark debate and add complexity to an already overheated educational system.
The Gist of Things
To be clear, high-quality, accredited universities still offer immense value that cannot easily be replicated by other providers. But for years, higher education has struggled to keep up with various types of structural problems owing to unfavorable funding models and rising tuition costs in many countries. This situation is concerning enough in itself. However, another challenge has emerged in recent years in the form of an increasingly competitive market with digitally-born educational providers such as Coursera, EdX, and the like.
The emergence of alternative certification methods, including micro-credentials and online courses, has further heightened the competitive landscape for students and resources. Amid these changes, educators must balance the increasing desire for personalized learning experiences with the imperative to uphold academic standards and cater to the varied requirements of students.
Up until the end of 2022, online courses and education was a multi-billion dollar industry experiencing in growth. Yet, appropriate responses from brick-and-mortar institutions were few and far in between. Below, you will see the development in users over a four-year period on Coursera:
Revenue in the online education market has been growing steadily over the past five years. According to Statista, the revenue in the online education market is projected to reach US$166.60bn in 2023, with an expected annual growth rate of 9.48% from 2023 to 2027. The market’s largest segment is Online University Education with a projected market volume of US$103.80bn in 2023; this is great news for digital, data-driven, online-based universities and for those undergoing this transition.
However, as I pointed out in my post This needs to Change in Higher Education Management, higher education often struggles with legacy structures. Leadership is typically focused on - and rewarded for - delivering consistent academic outcomes, which is commendable. However, the exceedingly long product lifecycles, as it takes years to produce graduates and quality research, are becoming increasingly challenging.
In recent years, this premise has rendered many higher education institutions and their leaders less able to follow movements in the market compared to their digitally-born, data-driven competitors. But it's also a question of mindset. Leaders must cultivate skills that intentionally challenge established comfort zones. There's a crucial need for a change in perspective. This change involves leaders understanding that not every transformation can be predetermined or quantified immediately and that seeking stability in this era can be counterproductive.
This landscape was already shifting before November 2022 when OpenAI and ChatGPT entered the scene. Since then, AI has further emphasized many of these issues; online AI-based educational providers are gaining significant traction in the market, continuously investing in powerful and tailormade AI models that are trained on educational material rather than generic models like ChatGPT. Moreover, increased competition will likely drive down prices which is probably not really what most institutions would want right now.
But it gets worse.
Why AI Regulation May Add Insult to Injury
Higher education institutions are, for better or worse, at the forefront of a shift in our fundamental understanding of knowledge. And while institutions struggle to keep up with AI in the classroom and the in boardroom, regulators perhaps struggle even more to understand the technology and its real-life applications (take a look at the Guidance for generative AI in education and research, released by UNESCO last week).
Several countries are beginning to issue AI policies and guidances to educators, and soon these will be followed up with regulations. I personally belive that this is not just a good thing, but absolutely necessary for the safe and sustainable development of a technology still at its infancy. However, what does this mean for the fundamental idea of universities, as businesses and societal resovoirs of advanced knowledge, when global policymakers set the tone for AI usage? Regulations will address essential concerns like data usage and privacy. Still, policymakers must tread carefully. Otherwise, well-intentioned regulations could inadvertently spell significant disparities in global education.
Educators skeptical of AI, along with public institutions under tighter governmental reins, might adopt AI technologies less extensively, possibly limiting their students' interaction with these tools.
Conversely, AI proponents, especially in private institutions with fewer governmental constraints, will empower their students to achieve remarkable accomplishments with AI. These students will gain significant advantages over peers in more regulated environments, making them more valuable to future employers, as entrepreneurs, and in various other capacities. The private sector already highly demands this caliber of education, and over time, the public sector will too.
In conclusion
It is crucial to recognize that the intrinsic value of higher education isn't purely in its ability to adapt to market fluctuations or technological innovations. Its core strength lies in promoting critical thinking, nurturing creativity, and instilling a sense of purpose and belonging. As AI progresses, these traits will likely become even more crucial. The question then becomes if higher education institutions as we know them today are the ony ones, or indeed the best ones, equipped to convey those core strengths to students.
Higher education clearly finds itself caught in a whirlwind of transformation, both in its essence and execution. The juxtaposition of legacy structures and the evolving technological landscape paints a complex picture.
For institutional leaders, the dual challenge lies in proactively seeking and initiating change (not merely adapting to it) without losing sight of their foundational principles. Simultaneously, they must equip students with skills and perspectives that AI cannot replicate.
Universities and colleges that strike this balance will be the ones that not only persist but also lead the way. However, it will be more demanding than ever before.