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Starbucks or AT&T? ASU or Udacity? What’s happening in postsecondary education this week?

This week featured two interesting announcements regarding corporations and postsecondary education.

Starbucks and Arizona State University announced a program where Starbucks will help their employees take courses and acquire degrees through ASU online classes: http://www.azcentral.com/story/laurie-roberts/2014/06/16/starbucks-asu-partnership/10593727/

AT&T and Udacity announced a partnership around a form of microcredentialing that they are calling nanodegrees: http://venturebeat.com/2014/06/16/att-and-udacity-partner-to-create-the-nanodegree-a-new-type-of-college-degree/

Back before many of you were born, maybe 30 years ago, corporations routinely paid for education for their employees as a benefit; partly out of a sense of providing for their employees, partly as a way to attract more and/or better workers, and partly as a measure to train, retain, and promote their best employees. This practice has, in general, fallen out of favor.

The Starbucks/ASU announcement could be an early indicator that labor markets are heating up. It’s certainly an indicator that online courses are becoming mainstream. It demonstrates the trend for online brands to grow beyond their geographic borders, which might portend fewer but larger (or much larger) institutions of higher learning. And it might show a new trend in university/corporate partnerships which will increase the numbers of college graduates.

Corporations, with their focus on the bottom line, will, of course, be looking for the biggest bang for the buck. Will this drive down the cost of a college degree? Will this prompt a race to the bottom, where higher education providers focus on decreasing costs (and service) so that higher education will start to deliver the level of service we’ve all come to expect from telephone companies and airlines?

The Udacity/AT&T announcement is different.

Corporations want employees with the specific skills to do the job that needs to be filled right now. They may not need employees with college degrees for that job. They don’t want the expense of giving employees time off for training. If possible, they don’t want the trouble and costs of providing the training.

Can providers of online content, like Udacity, fill this void? They will need to provide a short path to certify those skills, that a corporation is hiring for, and they will have to bridge the gap between what an individual knows and what an employer needs more economically than other alternatives.

Udacity is a profit making institution, and top management is highly motivated to find a niche. But this type of short term skill development, especially for mid-level skills has been fulfilled by community colleges, which are subsidized by state and local governments. Can Udacity compete? Can Community Colleges pivot as fast as an entrepreneurial company? Will some other education channel beat out both?

At the content level, hundreds of thousands of instructors and instructional designers are creating free resources (Open Education Resources) that also may provide these skills. The issue has been the difficulty of finding the right content to fit the specific skill being taught, and so organizations such as the Saylor Organization have stepped in to curate and maintain this content around competencies (Competency Based Learning) and then measure and certify the skills acquired, usually at very low costs. Perhaps Saylor can step in to fill corporations’ needs using curated free content.

And let us not forget the traditional textbook companies like McGraw-Hill Education. They are not going to sit idly by while others provide the skills that their materials have covered for over a hundred years. These companies are pivoting from producers of textbooks to curators of learning content.

To me, the Udacity announcement shows a change in beyond-high-school (or postsecondary) education. While the Starbucks announcement is focused on degrees, the job market wants skills. It makes sense for content providers to partner with the job providers to meet their needs: to provide bite-sized learning, certify the results, so that job seekers can advance their careers and companies can fill their employment needs.