"e-University" Project

ANNEX A

Project to Develop Virtual Distance Learning in Higher Education

Aim

1. To establish a globally-competitive provider of higher education programmes through virtual distance learning. The project's working title is the e-University.

Background and Objectives

2. The project aims to address current issues about the longer-term ability of UK higher education to compete against the major virtual and corporate universities developing in the United States and elsewhere. Those overseas universities focus on distance and web-based delivery, and have the funds to achieve global reach. Some of them have a strong international brand image, and are investing resources on a scale which no individual UK higher education institution (HEI) can match. A detailed survey of developments in other countries is being undertaken through a research project on borderless education being funded by the Higher Education Funding Council for England (HEFCE) and the Committee of Vice-Chancellors and Principals (CVCP).

3. These developments potentially pose a significant competitive risk to the ability of UK universities and colleges to recruit overseas students, and to the UK market for continuing professional development and vocational qualifications. The markets being targeted by the virtual/corporate private HE providers are some of the most lucrative, including vocational programmes for high-income professionals, often in subject areas which do not require expensive facilities and equipment.

4. The Prime Minister announced in June 1999 an initiative to increase the UK share of the overseas higher education market, since that has both economic and cultural/diplomatic benefits. The specific targets set were:

To attract 75,000 extra overseas students to the UK by 2005.
To increase the UK's share of the fee paying market from outside the EU, in relation to English-speaking countries, to 25% by 2005 - an extra 50,000 students.

5. The UK has a strong track record of world-leading initiatives in the use of new technologies in higher education:

We developed a world first in distance learning with the Open University.
We have, in the JANET and SuperJANET networks, one of the world's best and most innovative academic IT networks.
The Joint Information Systems Committee of the UK funding councils brings together leading experts in the field. The JISC is developing programmes for web-based access to teaching and research resources, including journals and moving images.

6. This gives the UK a world-class reservoir of experience and expertise to draw on in developing the project. We also have the major advantages that our HE continues to have a good reputation overseas, and that English is the preferred international medium of instruction in HE.

7. But in order to meet the competitive challenge, we now need to develop a similar world-competitive position in virtual distance learning. There is no shortage in HEIs of high quality teaching and learning materials and expertise in their delivery via the internet or other new technologies. Many individual HEIs are seeking to develop web-based applications on their own or in groups. But no single HEI has the resources to exploit existing materials and expertise with the necessary scale and profile. Such investment can only be justified if one can be confident of reaching a large market at home and overseas. Hence the need for a pump-priming initiative to bring together existing resources and talents in a way that achieves the necessary critical mass.

Setting Up the Project

8. The following paragraphs set out the model identified so far. But other options may be possible, which could more effectively deliver the objectives. The HEFCE will be undertaking studies to test this model and its implications.

9. The HEFCE would issue an invitation to all HEIs to submit proposals to join a consortium to develop the e-University.

10. Each bidder would be asked to set out:

Its track record in ICT and use of new media in distance learning.
Its reasons for wanting to participate in the initiative, and why it believes that its reputation and general record would enhance the project.
What matching resources it could contribute.
The spread of subjects across which it would expect to contribute.
Any other HEIs with which it would be interested in forming a consortium.
Other partners outside the HE sector (both overseas HEIs and companies) which it considers would be appropriate members of a consortium.

11. The HEFCE would broker the formation of a consortium in the light of the initial submissions. We have considered inviting proposals from consortia which the institutions would identify for themselves. The disadvantage of that approach is that we would probably receive a number of regionally-based consortia proposals, whereas what we believe we need to do is bring together the strongest candidates on a national basis. For the project to succeed, it will need to be established on a significant scale; and to be cost-effective, it will need to exploit to the full the economies of scale offered by ICT. And we would want the e-University to be clearly positioned overseas as the flag-carrier for the best of UK HE in virtual delivery.

12. The HE funding bodies for Scotland, Wales and Northern Ireland have indicated that they would wish the project to be undertaken on a UK-wide basis, in order to get the strongest team.

13. We envisage that the consortium would include private sector companies from relevant economic sectors, who would be involved as deliverers of the project. (Private sector and other employers might also, of course, be users of the e-University product.) As well as propositions from bidders, we would use the experience of our Joint Information Systems Committee to help identify potential partners. Once the successful consortium had been established, we would also want JISC to help broker the most effective forms of private sector involvement, use of the JANET/SuperJANET networks, and use of the materials which they are now getting configured for web use, in order to support the project.

14. Bidders would be encouraged to identify potential overseas HEIs which they think could usefully be associated with the consortium. A number of leading UK HEIs already have close links with countries such as Singapore, Malaysia, Indonesia and China, which are potential gateways to huge overseas student markets. We would also want to use the links developed through HEFCE's international collaboration programme with target countries - including Argentina, China, India, Brazil and South Africa.

15. We envisage that the e-University would be formed in the first instance as a company jointly owned by the consortium members. It could thus draw directly both on the expertise of the members in developing and offering higher education programmes, and also on their constitutional powers in relation to university title and the award of qualifications without needing the incorporation of a new academic entity with degree awarding powers under statute or charter.

16. The e-University would not have its own physical campus for teaching purposes. Any overseas or home students seeking a campus-based course would be directed to the existing programmes of consortium members.

17. In determining the purposes of the company, it will be important to define areas in which consortium members agree to work together and areas in which they retain discretion to act individually. Members would not be expected to abrogate their rights to recruit directly overseas, or to develop on-line teaching material for their own individual use.

18. Many individual UK HEIs have devoted a lot of effort and resource to both IT-based delivery and overseas recruitment. We do not want the project merely to duplicate their efforts rather than growing new products and markets. So we envisage that, in addition to the core members of the consortium, there could be associate membership open to any HEI through which they could:

Contribute any existing learning materials for delivery through the e-University, for a royalty, and subject to suitable quality assurance. There would need to be a licensing system to establish the respective rights of the originating university, the e-University, and other university members of the consortium in using the materials contributed.
Co-ordinate overseas recruitment activity, with joint marketing and collaborative identification of respective target groups.

Operation and Resourcing

19. We envisage that, once fully established, the main activities of the e-University would be:

To develop a portfolio of courses suitable for virtual learning, with careful targeting of subject areas and student markets.
To identify among core and associate consortium members suitable existing programmes and learning materials for configuration for virtual delivery, or to commission members to develop them from new.
To configure electronic access to the library and learning resources of consortium members and the SuperJANET networks.
To develop and administer a student tutoring service, drawing on existing and newly-recruited staff of the consortium, capable of web-based delivery anywhere in the world.
To develop and administer student recruitment and support services on a similar basis, so that students can access pastoral, financial and other services of the consortium members.
To assess students' progress, and award qualifications, applying the same standards and expectations as for UK higher education courses generally.

20. The e-University would not undertake research in its own right. That would remain the province of the member universities.

Funding

21. There would be four funding streams for the project:

Set up costs to be provided by the HEFCE. The scale of funds available is under consideration as part of the Year 2000 Spending Review.

Recruitment of overseas students paying full cost fees. As an illustration of scale, the latest financial forecasts for HEIs show the following actual and projected income from overseas tuition fees for HEIs in England:

1994-95	£386 million actual
1995-96	£431 million
1996-97	£482 million
1997-98	£540 million
1998-99	£539 million projected
1999-2000	£560 million
2000-01	£602 million
2001-02	£647 million
2002-03	£686 million

Full-cost training courses for UK and EU students in continuing professional development. Again as an illustration of scale, in 1997-98, UK HEIs earned £458 million in course fees for part-time courses. Here too the potential scope for growth is substantial, in line with the Government's learning society objectives.
Publicly funded student numbers allocated for the e-University. Each year the HEFCE allocates additional student places to HEIs. Some of these could be allocated for the purposes of the e-University within planned growth year on year. The Government has indicated a commitment to a growth in HE participation to 50% for people between the ages of 18 and 30. Achieving that growth will require finding new ways of enabling under-represented groups to participate, and the e-University would offer new flexibility for many students. The resources available through this route will depend on the annual grant settlement for higher education.

22. The project should also be attractive to providers of venture capital, and should be able to raise matched funding from private sector participants. These funding opportunities would need to be carefully examined as part of a full business plan.

Intended Benefits

23. The benefits for individual member HE institutions will be:

Increased revenue from growth in their student numbers overseas and in the UK CPD/vocational market.
Reduced costs from pooling overheads in overseas marketing, course development, and infrastructure for delivery.
Scope to extend the use of existing programmes and expertise to benefit an increased number of students.
Involvement in developing the application to HE of the most innovative technologies for course delivery and student support, with staff development and other knock-on benefits for their own programmes.
Enhancement to their reputation from involvement in a flagship project.

24. Employers who support continued training, education and development will gain a better qualified workforce. Those who have felt unable to allow staff time off for study may be more willing to do so, with greater flexibility around when study is undertaken.

25. Individuals will have enhanced their job prospects and earning capacity.

26. The reputation of the UK overseas for excellence in higher education and for cutting-edge application of technologies in HE will be reinforced.

27. The UK economy will benefit from increasing revenue from overseas students.

HEFCE
February 2000

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