2024 Q4 Review: Online learning developments in UK higher education
Photo by Matthew Henry from Burst.
It’s been another eventful quarter in UK higher education. This quarter, the English and Welsh governments announced the first rise in undergraduate tuition fees since 2017. From 2025–26, annual undergraduate tuition fees will increase from £9,250 to £9,535. However, the government also raised the rate of employer national insurance contributions while lowering the earnings threshold for those contributions, meaning the additional tuition fee income will be insufficient to cover the increased costs. From an English and Welsh university perspective, presumably the only thing missing from these announcements were some “your uni’s so poor” jokes.
In terms of the financial health of the UK higher education sector, it’s very much as you were. This quarter, it was estimated that three-quarters of UK universities will be in deficit next year, and there has been a continuation of job loss announcements across institutions. This financial context remains a key driver for more UK universities seeking to enter the online degree market as they look to increase revenue and reach new students, particularly in light of the significant decrease in international postgraduate students enrolling in on-campus degrees.
Perhaps unsurprisingly, this quarter brought more online education announcements from UK universities. It also brought cost-cutting measures and announcements from some online education companies, reflecting that universities are not the only ones facing financial challenges.
UK universities and the online degree market: New moves and partnerships
This quarter has seen several announcements from UK universities signalling either new moves into the online degree market or a deepening of their involvement in it.
One of the biggest pieces of news was the launch of the first online masters degrees from UAL Online, the online arm of the University of the Arts London. Over the past year or so, UAL Online has been building its team and preparing for this launch. This is another example of creative arts institutions, who have not traditionally been strongly associated with online learning, entering the market seriously.
This quarter also brought news of another UK university partnering with an online programme management (OPM) company, this time between the University of Southampton and CEG Digital. This partnership will operate under the brand Southampton Online, with no specific details about the focus of the degrees released yet. This partnership will be welcome news for CEG Digital particularly, as the company has seen its number of partnerships decline in the past year due to various factors.
Other announcements this quarter include Coursera expanding its UK university partnerships with the launch of an MSc in Computer Science in collaboration with Heriot-Watt University. 2U and the University of Birmingham have also launched their first two online master’s degrees, with three more planned for 2025. Lastly, the University of Wolverhampton and Learna, also announced a new partnership to launch online master's and postgraduate diploma’s in healthcare subjects.
This quarter’s review has come slightly too early to capture a few other partnerships that are expected to be announced or become evident in the near future.
Another noteworthy development was the launch of a suite of online short courses and professional certificates by St Mary’s University. In the past quarter, the university introduced over 35 microcredentials in subjects such as computing and business and management.
There are several interesting observations to make here. Firstly, these courses are non-credit-bearing and are not linked to higher-level qualifications such as degrees. They are self-paced, enrol-anytime courses, with an upfront payment that leads to a certificate of completion upon finishing. Notably, there is a price differentiation between short courses, priced at £549, and professional certificates, which cost £299.
In some ways this is an example of the fuzziness of the microcredentials market. Personally, I would expect the opposite, with professional certificates being the more comprehensive and expensive option. However, a comparison between these professional certificate products and those offered by Coursera, LSE et al reveals a lack of product consistency.
Consistency is a key principle in user experience (UX) design, and is included in Nielsen Norman Group’s ten heuristics. They divide consistency into two types: internal and external. Internal consistency refers to uniformity within a product or product family, while external consistency relates to conventions established across the wider industry or web.
The lack of external consistency in the microcredentials market is clearly evident, which does little to support these offerings as an emerging product category. It also doesn’t allay concerns many people still have about the demand for microcredentials and their market potential. This inconsistency also poses challenges for universities in labelling and defining these course products. If the sector continues to launch and brand microcredentials in ways that vary significantly, it is likely to hinder rather than help their development.
2U and Coursera: Updates from online education companies
Outside of the partnership announcements mentioned earlier, there have also been several important updates from online education companies. One of the most significant was 2U's decision to shut down its bootcamp operations. This was a part of its "alternative credentials." segment that became an area of focus following its acquisition of Trilogy Education in 2019.
2U attributed the decision to shifts in the job market and evolving employer and employee needs, stating:
“Simply put, the long-form, intensive training that boot camps provide no longer aligns with what the market wants and needs.”
In the UK, both the University of Manchester and the University of Birmingham partnered with Trilogy for bootcamp provision. Also, in 2022, 2U secured a £4.8 million UK Department for Education (DfE) contract to deliver online bootcamps to over 1,000 people in front-end web development. However, an Ofsted inspection in March gave a critical review of this provision, highlighting high dropout rates and other issues. By May, 2U announced the winding down of its bootcamps, citing a focus on sustainability in response to its well-documented financial challenges.
In its bankruptcy filing for the quarter ending 30 June 2024, 2U reported:
“Revenue from our Alternative Credential Segment decreased $23.9 million, or 23.3%. This decrease was primarily due to a $25.6 million decline in revenue from our boot camp offerings, driven by a 40% drop in FCE enrolments, particularly in coding boot camps.”
The decision will inevitably lead to further job losses and represents another step towards achieving more profitable and sustainable operations, made increasingly urgent by the company's financial difficulties.
In tandem with this announcement, 2U revealed a strategic pivot from bootcamps to micro-credentials and professional certificates, launching its first offerings in collaboration with Columbia University.
This development further lays bare the contribution 2U's past acquisitions, such as Trilogy Education and edX, has had on bringing 2U so low, and the tough decisions the company has made—and continues to make—in an effort to rebuild.
2U was not the only online education company making difficult decisions this quarter. Coursera announced its Q3 results, which included a 10% reduction in its global workforce as part of a cost-cutting drive to improve profitability. This decision is likely linked to a downward revision of its 2024 revenue outlook, from a top-end estimate of $705 million to $694 million.
On a more positive note, Coursera reported a 6% year-over-year increase in revenue to $176.1 million in Q3, exceeding its Q2 predictions. Despite a net loss of $13.7 million, this marks an improvement compared to last year, both in terms of the absolute figure and as a percentage of revenue. Adjusted EBITDA was also positive for the third consecutive quarter, at $13.3 million.
Coursera’s three main segments—Consumer, Enterprise, and Degrees—all saw growth. Degree revenue reached $13.4 million, with learner numbers increasing to 26,400, largely driven by new online degrees from Indian universities.
Coursera’s portfolio of online certificates and degrees continues to expand, with notable new partnerships including Adobe (offering certificates in content creation and graphic design) and, given their status as a new UK partner, Saïd Business School at the University of Oxford.
THE Online Learning Ranking 2024: An underwhelming first attempt
This past quarter saw the release of the much-anticipated Times Higher Education Online Learning Ranking 2024, which, frankly, was feeble, even for a first attempt. Having not previously engaged deeply with rankings in the past, I’ve been surprised by how flimsy the whole ranking business feels.
The ranking listed 120 institutions, but only 56 received a rating of gold, silver, or bronze. The remainder were categorised as "reporters," meaning they had submitted data but failed to meet the full entry requirements, presumably they were included to pad things out. In terms of representation, this ranking is, in large part, a story of a whole swathe of significant university players in online education that did not take part.
There are several issues with the methodology, which feel as though they are driven partly by the fact that ranking companies are often heavily criticised—and sometimes outright disliked—within higher education. Which seems to lead to a kind of "purpose washing," where socially virtuous themes are awkwardly shoehorned into the ranking criteria as part of a PR strategy.
Another key thing to understand about this ranking is that it does not focus exclusively on 100% online degrees with no attendance requirements. Instead, it includes courses where at least 40% of the content is delivered online. THE ranksplained that this was because they’ve uncovered that there’s no global consensus on online learning. This news resulted in impromptu street parties and conga lines amongst online learning professionals globally, who have been waiting decades for a proverbial Columbus to map the vast, uncharted waters of online learning for them.
All jokes aside (and I have many), the key mistake THE made with this ranking, in both its communications and approach, is to project its own ignorance of the online learning field as evidence of a broader absence of knowledge and standards in the sector. While the gold-rated universities, including the University of Essex and the University of Liverpool in the UK, will use this recognition to promote their online degrees (and I don’t blame them), this is ultimately a ranking that, in its current form, lacks credibility or seriousness.
StudyPortals and the British Council: Insights on global online degree growth
Another interesting report this quarter came from the course aggregator company StudyPortals and the British Council. It was framed as evidence of growing global demand for English-taught online degrees outside the "big four" countries (US, UK, Australia, and Canada).
The report’s only data point were course listings on StudyPortals sites, so what’s really being reflected here is an increase in supply on their platforms. StudyPortals also acknowledged that this increase is partly due to an expansion in the breadth of their listing coverage, rather than solely the emergence of new degrees.
The headline figures from the report were:
A 123% increase in online English-taught (ET) degrees listed on StudyPortals websites between 2019 and June 2024.
92% of all online ET degrees listed were from universities in the UK, US, Australia, or Canada.
1,212 online degrees from countries outside the big four were listed, representing a 94.5% increase from the 623 listed in 2019.
Of these 1,212 degrees, 823 (68%) were from Europe, followed by 9% from Sub-Saharan Africa.
Germany, Ireland, and Spain were identified as the countries with significant growth in online degree listings on their sites.
While the report has merits, those who are tempted to take this as evidence for massive growth in demand for online education globally, and for growth in supply outside of the big four should be cautious.
I definitely have questions about the robustness of the data for certain countries and what the reported number of 1,212 and associated percentage increases actually represent.
If you take online masters degrees in Germany on StudyPortals as an example. A closer look at online master’s degrees listed on StudyPortals shows that 52% are from two private institutions: IU International University of Applied Sciences and Tomorrow University of Applied Sciences. The listings also include degrees from institutions like the University of Law, based in the UK, and ESCP Business School, headquartered in Paris but with German campuses. So what we’re actually seeing here is the significant expansion of online degrees from German private universities strategically focused on online learning. Incidentally, these institutions are often very proactive and visible on course aggregator platforms.
That’s quite a different story from what the headlines might suggest. It’s one of a growing number of examples showing how the international higher education scene is becoming increasingly interested in online learning, after historically being heavily focused on the traditional market of internationally mobile students. While some of what is emerging doesn’t always pass the smell test, if it ultimately leads to better data and insights, that would be a welcome development.
Wrapping up Q4 in online learning
It’s been another eventful quarter in the world of online learning within UK higher education. The partnership and portfolio moves by UK universities, along with efforts from companies like THE and StudyPortals to plant a flag in online learning, reflect a growing interest that is taking various forms.
In some cases, these developments are also producing data and information that, let’s say, may present a somewhat incomplete picture of the online education landscape. For universities, the trend towards more market entrants is driving increased competition in online student recruitment, along with the broader challenges this poses to a sector looking for some financial relief from online degrees.
This leaves us with plenty to discuss, and I’m sure that in 2025 Q1 there ‘s going to be more interesting developments in the online education sector to explore.
