Content-type: text/html ~ Stephen's Web ~ What Happened at California Virtual University

Stephen Downes

Knowledge, Learning, Community

Apr 14, 1999

In mid-September of 1997 and with much fanfare, California Virtual University (CVU) opened its doors, launching a website which would feature "the online and distance education offerings of all California accredited colleges and universities."

The following year, state governor Pete Wilson pushed for and won $16 million (all figures in US dollars) for online learning, and of that, six million for CVU in particular. "We'll have a global audience," said Diane Vines, vice president of academic development for the California State University Institute who served as CVU's chief academic officer for the design and planning phase.

By April of 1999, the dream lay in ruins. All that will remain is a listing of online courses and programs offered by other California institutions. CVU's plans for an virtual library and online guidance counseling service were shelved. Staff were laid off.

What happened? The L.A. Times provides the accident report:

Last July, Wilson turned over the California Virtual University to a nonprofit foundation, saying there was "no need" to create a new state bureaucracy. He launched it with temporary funding from private donations, hoping it would soon be bringing in revenue from ads on its Web site at

But when Stanley A. Chodorow arrived as the virtual university's first CEO, he found it without any financial means of support. So he asked private colleges and the three public segments--the University of California, Cal State and community colleges--to collectively chip in $1 million a year for three years while he built up advertising and book-sales revenues.

The colleges and universities balked, and CVU, with no money for its operations, folded up its tent, leaving only the directory.

While on the one hand this is just another story of an unprofitable enterprise biting the dust, on the other hand it is a story of wider impact because CVU was seen in some quarters as a model for the future. The failure will affect online learning in general, and the reasons for the collapse attributed to weaknesses in the medium as a whole.

The post mortem offered by the L.A. Times is unsatisfying.

The article suggests that the reasons for the retrenchment included:

  • concerns that the university would widen the gap between wealthy white students and less wealthy non-white students
  • flaws in studies showing that people learn as well online as in a traditional setting
  • opposition from the American Association of University Professors
  • Lack of financial support.

Other commentators also suggested:

  • lack of financial support
  • short-sighted planning
  • control and predation of 'mainline' business units.

The first three 'reasons' cited in the article are implausible. None of these circumstances is unique to CVU. Online learning institutions around the world have worked on issues of access, credibility and instructor support with some degree of success. Certainly the proliferation of private for-profit institutions would not be possible were these insurmountable issues.

Even as early as last year, Ted Marchese, in the American Association for Higher Education Bulletin, noted that "Dozens of private and regional-public colleges, for example, now offer degree programs in the Washington, DC, area. Wisconsin recently counted more than 100 out-of-state degree providers within its borders; there are 37 in Milwaukee alone."

The 'financial support' argument is a bit hard to accept as well. Certainly, from some points of view, the level of support may seem small. Thus, for example, Gary Berg writes in an article for Education Policy Analysis Archives, "Clearly, with a proposed $6.1 million in the coming fiscal year for the UC, CSU and community college system, the California Virtual University is a small effort."

And Dave Balch writes to an online learning list server, WWWDEV, "We are going (38 students the first semester, over 300 two years later) but still not the 'cash cow' the administration had hoped for."

Even so, six million dollars is a lot of money. By any account, that is adequate funding. Additionally, since CVU does not actually create online courses - it only catalogues them - it has no design or delivery expenses. Under CVU, individual institutions design and deliver online courses. A number of member institutions received significant grants for online course development.

So at first blush, the financial argument does not make sense. Even the university's failure on financial grounds does not seem to make sense. Why would Stanley A. Chodorow, CVU's first CEO, request a million in funding from the state's educational institutions? That seems a bit much for just a database.

Clearly, CVU was never intended to be just a database. But what it was intended to be isn't as clear. The flag waving and hoopla surrounding each new phase of CVU promised more and more.

Politicians and administrators said things like "We're aiming to be the of the technology-mediated education in California" (Rich Halberg, CVU's spokesman.)? Mid-1998 saw a number of glowing reports in the print media, such as A study in success: State's virtual 'university' graduates to a new level. On the web, CVU's earned an inexplicable 'five star' rating at Distance Education Review.

It all seems to be a mish-mash. Some articles say that CVU would 'house' online courses, while others make it clear that it's merely an index. A number of articles played up CVU's 'Student Union' without noting that CVU has no students. The role of CVU in providing technology, support, or infrastructure was unclear.

One of CVU's primary parameters was a partnership between industry and education. This was announced with great fanfare when it was launched. Sun Microsystems, Microsoft, Pacific Bell, KPMG Consulting, and International Thomson Publishing all contributed. But this venture was far from altruism on the companies' part. The companies would take over the schools' computer and telephone systems, and share profits from services such as computer support, pagers and Internet access."

This plan immediately ran into controversy. The selection of the companies occurred without tender and behind closed doors. Other companies vied for a piece of the pie. Legislators questioned the wisdom of a 10 year lock-in. Academics and other staff criticized the plan, calling it the privatization of higher education. In April of 1998, Microsoft and Hughes pulled out.

What is clear is that each of the players had its own agenda. The corporate sponsors wanted to earn profits by providing services. The member institutions wanted to preserve autonomy. The government wanted good press (as Wired sardonically reports, "Wilson wants to be known as the 'technology governor' who brought academia and industry together.") The frustration caused by such varied expectations expressed itself early and often. For example, Assemblywoman Debra Bowen, a Southern California Democrat, questioned the partnerships:

`The concerns are about the financial risk that the state's taking and who really winds up paying the freight for this -- is it primarily off-campus students? This is a deal that was negotiated without a competitively bid contract in private, and as people have begun to take a look at it and raise concerns it's become less attractive to the private sector partners to risk that much capital.

And California Senate and Assembly subcommittees expressed their reservations:

CSU officials came up with the plan because the Legislature has not given the 325,000 student system the funds to provide state-of-the-art computer network connections. Students and professors have protested CETI (California Educational Technology Initiative), calling it the privatization of higher education. Other firms have complained that the four corporations would have a lock on future sales to CSU. The lawmakers voiced similar concerns about locking CSU into exclusive providers or one kind of technology.

A large part of the reason for this lies in the way CVU was structured. As the University of Alberta's Director of Academic Technologies for Learning, Terry Anderson, writes, "CVU seemed dependent on the traditional member institutions to provide courses and grant the degrees." Because of this, it did not have the institutional autonomy to set its own direction or develop policy appropriate to its medium. According to Anderson, this is part of a larger trend:

This reinforces the concepts from Christensen's excellent book Innovators dilemma: When New technologies Cause Great Firms to Fail, in which he argues that disruptive technologies must be allowed to incubate outside the realm of control and predation of the "mainline" business units.

This would also explain Berg's assertion that "the present offerings of both the WGU and CVU... are not very impressive. In fact, they are little more than a hodgepodge catalogue of previously existing courses with great differences in format and quality."

But even so, student interest has been significant. Joe Rodota, Executive Director of the CVU Design Team, notes that

The initial Web-site launched by the CVU Design Team in mid-September has attracted more than 100,000 visitors in just over 60 days. Hundreds of prospective students, faculty and corporate partners have provided input by completing online surveys, and more than 1,500 people have requested regular e-mail updates on the project.

Even if badly planned and presented, it still appears that online learning is a major draw.

No, I think that CVUs problems had nothing to do with access, pedagogy, staff support, or even funding. CVU worked with a fundamentally flawed business plan from the beginning. No amount of rejigging would save it.

By July of 1998, with new corporate support (Oracle) and a new site, CVU relaunched with plans to support itself through E-Commerce. It was doomed to failure.

E-Commerce only works if people use the site and buy things from it. With each institution offering courses from separate sites, there is no natural nexus for students once they have started taking courses, no reason for them to return to the site. Hence the request for funding from the institutions, their sceptical reaction, and the downfall of the plan.

What can online learning institutions learn from this?

First: there is a great danger that online learning will suffer from the (uninformed) promises made by administrators and government officials. Expecting quick financial returns, expecting to be the provider of a certain course, program, or service, expecting that staff and students will flock unassisted to the new paradigm: these are all pitfalls into which promoters of online learning sometimes fall, and ironically, sometimes the discipline's greatest proponent can also be its greatest liability.

The way to proceed in online learning is - ironically, given the nature of the internet - slowly and cautiously. The introduction of new technology must be, as David Jones says, a product of evolution. Pilot delivery and evaluation should be conducted before the announcements and promises are made. Staff should be acclimatized and trained in new technologies and methodologies (indeed, it is characteristic of CVU's approach that staff were left pleading for training).

Second: corporate excursions into online learning will not be altruistic. Corporations are expecting specific returns. When they donate equipment or resources, they are expecting 'lock-in' - that is, a dependence on their technology. Moreover, they often desire to own the infrastructure, billing institutions for service (and leaving institutions to run the risk of passing those costs on to government or consumers). Where corporations venture into the provision of learning itself, their objectives will be based on profit, not social need.

This is not the time to debate the merits of for-profit education or corporate universities. But administrators and educators should understand that such institutions would change the nature of learning. Some - such as Open University's vice-chancellor Sir John Daniel - even take comfort in that fact:

...the core purpose of the university is to inculcate in its students an attitude of systematic scepticism. That is why true universities will always be safe from take-over by commercial interests and why 'for-profit' universities can never be true universities. Systematic scepticism and the academic mode of thinking make corporations and political bodies nervous, although individual business people and politicians may give heroic individual support to these ideals.

But such a view should not resolve itself into complacency. What Daniel is missing is the idea that a new model for learning will supersede the old, that traditional universities would not be acquired by corporations, but rather, they may be replaced by corporations.

Third: joint ventures are necessary, because they reduce costs and improve usage. but joint ventures do not work unless the institutions work together, sacrificing (apparent short term) gain for future returns. Corporations know this, which is why they're willing to pony up the cash. Educational institutions do not, which is why they don't fund initiatives, protect their 'turf', and hence end up on the riskier side of online learning enterprises.

As Daniel says,

The key lesson that you should derive from the story of the Open University is that we need university-wide technology strategies to take full advantage of the knowledge media. Letting individual faculty and departments do their own thing in the usual way will not deliver the goods. Why? Because a laisser-faire approach is likely to increase costs and create excessive differentiation that students will find burdensome. Universities now admit the need to increase productivity. Technology can raise productivity, but only by reorganizing the teaching-learning process to play to our strengths.

And fourth: Colleges and Universities looking at online learning will have to understand that they are not looking at new ways of doing what they have always done, but rather, that they are looking at doing new things.

For example: the mega-university. Sir John Daniel, in another speech:

There is a new approach to higher education, based on different technology, that is now most successful answer to the crises of access, cost, quality and flexibility. It is the mega-university, a term I use to designate a university that teaches at a distance and has at least one hundred thousand students. There are now eleven of them, but since none of them is in the United States you won't know much about them.... 2.8 million students in just eleven universities...

Or as Eugene Rubin, Associate Dean of Distance Education at University of Maryland University College, comments:

Why would a student sign up with the CVU when they will get their degree from another institution? What is at issue here is that these virtual consortia are a sort of flawed concept and their failure does not represent a failure of distance education nor of institutions that are doing it well. For example, University of Maryland University College (UMUC) now has almost 200 courses on line and our distance enrollments are climbing at an incredible rate. We now have 15 undergraduate degrees and 7 graduate degrees completely on line and have over 12000 d.e. students.

It will not be enough to recreate typical university-style classes on the internet. For one thing, it's too expensive. As Daniel observes,

Half the world's population is now under 20. Our traditional concept of campus teaching will deny higher education to nearly all these youngsters. Yet providing them with education and training is not just a pressing issue for the countries concerned. This is a time bomb ticking under our collective security. Without vigorous action many of these young people will grow up to be unemployed, unconnected and unstable. In a global world that is a global problem.

In order to address the changing needs of education, the emphasis on the professor will have to be shifted. Students will be expected to learn on their own, with the professor's guidance. This means that online materials will have to be, as they say in the field, 'learner centered'.

Not that this is news to practitioners. Berg again:

As CPEC concluded in its 1996 report "Moving Forward," California needs more aggressive leadership in higher education.

There appears to be widespread agreement among educational planners working on a regional basis that what California needs is leadership that moves public colleges and universities to a completely new paradigm that is student-centered (California Post-secondary Education Commission, 1996, p. 15).

The California Virtual University clearly does not represent an instance of this kind of leadership.

In the end, the structure of CVU may be likened to attaching a team of horses to eight freight cars and a caboose. It is not surprising such an effort would fail. It's not merely that horses are not strong enough or smart enough to pull the train. It's that such an effort fundamentally misses the point of the new technology.

Online learning allows us not only to place texts and other materials on computer screens, and it does not only allow teachers and students better and cheaper modes of communication. It allows us to reshape learning, to do away with inefficient broadcast modes of teaching, and enter into an age of interactive learning.

It's a hard paradigm to enter. Instructors will have to surrender their traditional monopoly on what is taught and when it is taught. Students will have to surrender the comfortable cloak of dependence. Administrators will have to rethink institutional jurisdiction and protected territories. Each must give up something - but each, if they follow that path, may gain so much more.


California Virtual University (CVU)

CVU Faculty Club

CVU Announcements Board

Distance Education Review

News and Articles (Chronologically)

California Virtual University Plans Underway
Syllabus: November 24, 1997

California Virtual University offer new option for corporate training
by Joseph Rodota, Jr., California Manufacturers Report Vol. 36 No. 14 November 25, 1997

Prospective Students Test-Drive Classes at the California Virtual University
Syllabus: December 8, 1997

Wilson pushes cyber education in budget
Donald E. Coleman, The Fresno Bee: January 9, 1998,1225,8357,00.html

Short Take: California Virtual University gets boost from tech giants
By Courtney Macavinta, CNET January 16, 1998,4,18197,00.html

Lawmakers Question California Education Technology Initiative
Syllabus: January 19, 1998

Cisco Sponsors California Virtual University
Wired News Report: February 25, 1998.

Microsoft quits Calif. campus deal
Jon Healey, San Jose Mercury News: April 17, 1998

Microsoft Abandons CSU Venture But plan to link up college campuses still on drawing board
Pamela Burdman, San Francisco Chronicle: April 17, 1998 file=/chronicle/archive/1998/04/17/BU104630.DTL

Not-So-Distant Competitors: How New Providers Are Remaking the Postsecondary Marketplace
Ted Marchese, American Association for Higher Education Bulletin: May, 1998

Public Policy on Distance Learning in Higher Education: California State and Western Governors Association Initiatives
Gary A. Berg, Education Policy Analysis Archives Volume 6 Number 11: June 12, 1998

Solutions for *Techno-Shock* in Education
Joseph Auciello, CVU Conference Room: July 6, 1998

Virtual U.: 'Surfers' site opens college doors
Sacremento Bee, Editorial, July 16, 1998

"Virtual University" gets boost
Courtney Macavinta, CNET July 29, 1998,4,24735,00.html

A study in success: State's virtual "university' graduates to a new level
George Raine, San Francisco Examiner: July 30, 1998 file=/examiner/archive/1998/07/30/BUSINESS15111.dtl

Real Education and Common Course Numbering
Alan Buckley, CVU Conference Room: August 11, 1998

Stay Home and Go Back to School
Beverly Hanly, Wired News. September 28, 1998

Asynchronous Learning Trends
Bob Jensen at Trinity University, web site. Last Revised on February 26, 1999

California Virtual University Has a Collision With Reality
Kenneth R. Weiss, Los Angeles Times: April 8, 1999

The Intelligent Use of Technology
Sir John Daniel, address to TARA, Halifax, Canada: April 12, 1999

Re: Problems With Calif. Virtual University
Dave Balch, post to WWDEV, April 12, 1999

Re: Problems With Calif. Virtual University
Terry Anderson. Post to WWWDEV: April 13, 1999

Re: California Virtual University
Eugene Rubin, post to WWWDEV: April 13, 1999

Adoption, Appropriation and Evolution
David Jones and Teresa Lynch, web site. Last revised April 14, 1999

Technology is the Answer: What is the Question?
Sir John Daniel, address to TechEd99: April 21-24, 1999 (sic)

All sites viewed April 14, 1999

Stephen Downes Stephen Downes, Casselman, Canada

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