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Online U. Is a Lesson in Supply and demandA University of Phoenix Site in Omaha Moves Forward Despite Colleges' Concerns.The University of Phoenix

Posted on: Monday, 22 August 2005, 18:00 CDT

The nation's largest for-profit university is planning to open classrooms in west Omaha.

Representatives of some Omaha-area businesses, including Union Pacific and PayPal, say they welcome the new University of Phoenix campus center, but officials from Bellevue University and other institutions question how they'll compete with the chain's marketing budget and recruiting tactics.

The University of Phoenix, which specializes in online courses for working adults, has won approval from the Nebraska Coordinating Commission for Postsecondary Education to offer degree programs. An application for a permit to operate at 15858 West Dodge Road is pending with the City of Omaha.

"We go into communities where we're wanted and where we're needed," Debra Baldwin, a University of Phoenix senior vice president, said from Denver. "Students from Nebraska have been enrolled online for some time, and we've been contacted by people in Nebraska wanting us to be there.

"Our marketing research showed there clearly was a void we could fill."

The permit application and coordinating commission records say that the university plans to lease a 10,000-square-foot space, employ seven staff members and five instructors and provide a handful of classrooms to serve 80 to 100 students at a time, primarily in the evening.

Under a model the university started three years ago, Omahaarea students will meet the first and last nights of five- or sixweek courses and, in between, do their coursework online.

The university plans to offer 24 programs leading to six degrees, including bachelor of science in information technology and master of business administration.

The Omaha center would be the latest for a university founded in 1976 and accredited two years later.

One of the first to offer Webbased courses, the University of Phoenix has grown to more than 170 campuses, including a yearold one in West Des Moines that Baldwin said has fewer than 300 students enrolled.

Founder John Sperling is credited with being among the first to foresee a growing demand for adult learning and the potential of reaching more students by putting the curriculum online.

Sperling also is criticized for establishing what detractors call a "McUniversity" that strips college learning to bare bones and charges students more to get less.

In a March hearing before the Nebraska Coordinating Commission, representatives of about a dozen Nebraska colleges and universities urged commissioners to reject the University of Phoenix because they said it would duplicate existing programs and compete for a limited number of students.

Some also expressed concern about how the University of Phoenix competes for students, pointing out that it paid $9.8 million to the U.S. Department of Education to settle a dispute over how recruiters were compensated.

Mary Hawkins, Bellevue University's provost, urged the commission to protect Nebraska students from "predatory marketing."

She cited a legal skirmish over Google links that said "Bellevue University" but led people to a University of Phoenix site. The university said it was a mistake and apologized after a lawyer got involved, she said.

Thomas O'Neill, president of the Association of Independent Colleges and Universities of Nebraska, told the commission: "I am concerned that the entry of the University of Phoenix into the state will have a detrimental impact on the history of fair competition by the colleges in Nebraska."

University of Phoenix officials admitted no wrongdoing in the settlement with the Department of Education and say they paid to avoid a lengthy distraction.

Susan Mitchell, the university's vice provost and vice president for regulatory affairs, told Nebraska commissioners there was room in the state for more programs focused on working adults.

If there isn't, she said, "the risk is ours to assume since we take no state dollars. We are willing to take this risk."

Three Omaha-area businesses -- Union Pacific, PayPal and Signature Performance -- were among those submitting letters of support.

PayPal Vice President Ryan Downs praised the university's "tremendous flexibility" and faculty of "real-world practitioners."

"With today's mobile work force and ever-changing environment," Downs wrote, "educational institutions must have the ability to switch gears quickly and respond to the evolving needs of their students and the companies who hire them. The university has a proven track record of doing that."

A Union Pacific senior vice president, Robert Turner, praised the "portability" of the university's programs when students move from one state to another. As an employer of 50,000 people in 23 states, with the largest concentration in Omaha, it would be a big advantage to have the university in Omaha, he said.

Last week, Turner said in an interview that the University of Phoenix would be one more strong addition to the area's already strong list of postsecondary institutions.

"Our support shouldn't be seen as a criticism of anything here," he said.

The Coordinating Commission concluded that its authority to prevent duplicate programs was aimed at preserving public funds, and none were at risk.

Fred Scott, a Coldwell Banker Commercial World Group consultant, said the University of Phoenix is in the final stages of negotiating a lease at the Millennium Plaza office building.

Baldwin said the university hopes to begin offering classes as early as January.

The University of Phoenix

What is it? An accredited university owned by the Apollo Group Inc., it is a publicly traded corporation. It was among the first to offer online courses and in recent years has set up classrooms to offer hybrid programs combining online and on-campus courses. Founded in Phoenix in 1976 by John Sperling, a former history teacher and union organizer. The billionaire most recently was in the news for financing a dog-cloning experiment.

How big is the university? The company reports an enrollment of 295,500 students, with 141,000 students attending onground campuses in 39 states, Puerto Rico and Canada. The average student is 34 years old, and two years of significant work history is required for admission.

What degrees does it offer? In Nebraska, the plan is to offer 24 programs leading to six degrees: bachelor of science in business, bachelor of science in management, bachelor of science in information technology, master of business administration, master of management and master of information systems.

How does it work? Three-credit undergraduate courses meet for five weeks and three-credit graduate courses meet for six weeks. Students attend class the first and last night of the course and, in between, do coursework online, logging in a required number of times each week. They also work with a learning team of students who replicate the work environment by teaming up to complete assignments. Students take one course at a time.

Who makes up the faculty? The university employs a core faculty for a term of at least one year to teach, do administrative work and handle other duties. The university also employs part-time practitioner faculty, or members who teach at night what they work at during the day. Faculty members have a minimumof a masters degree.

What does it cost? Tuition is adjusted to the local economy. In Nebraska, tuition is anticipated to be about $300 to $330 per credit hour for undergraduate courses and $390 to $430 per credit hour for graduate courses. A major portion of students have tuition- reimbursement programs through their employers, and the university participates in federal financial aid programs, including the Stafford student loan, the PLUS loan and the Pell Grant.

Sources: Nebraska Coordinating Commission for Postsecondary Education, University of Phoenix and Apollo Group Web sites

Source: Omaha World - Herald

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