Transnational education one of the great growth industries of the future


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Higher education has become a major global industry. While the number of students studying at universities outside their own country continues to grow, the most dramatic development has been the increase in the number of students studying for a foreign degree without leaving their home country. So-called ‘transnational’ higher education, which embraces universities offering their degrees by distance-learning, through franchise partners and validated centres, as well as by setting up ‘international branch campuses’, is increasingly seen as one of the great growth industries of the future. This presentation, based on qualitative interviews with senior university administrators and higher education experts from a number of countries, provides an assessment of the growth prospects for this rapidly evolving, and largely unregulated, international market sector.

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Transnational education one of the great growth industries of the future

  1. 1. Transnational higher education: “oneof the great growth industries of thefuture”?3rd QS-MAPLE Annual Conference8 May 2013Professor Nigel HealeyPro-Vice-Chancellor (International)Nottingham Trent University
  2. 2. Introduction• ―Demand for higher education is growing worldwide... Increasingly,emerging economies want to educate their students at home, andthe UK - a global pioneer in developing educational facilities - is wellplaced to help… This is one of Britain’s great growth industries ofthe future‖ (UK Minister for Universities and Science , 2012)• So:– What is transnational education?– How big is the global market?– Will it really be a ―great growth industry”?17 May 2013 2
  3. 3. What is transnational education?• ―Any teaching or learning activity in which the studentsare in a different country to that in which theinstitutional providing the education is based‖ (GlobalAlliance for Transnational Education, 1997)• ―All types of higher education study programmes, setsof study courses, or educational services (includingthose of distance education) in which the learners arelocated in a country different from the one where theawarding institution is based‖ (Council of Europe,2002)17 May 2013 3
  4. 4. General Agreement on Trade in Services(GATS) and transnational education17 May 2013 4GATS terminology Transnational education variantMode 1 — Cross bordersupplyProgramme mobility: distance oron-line educationMode 2 — ConsumptionabroadStudent mobility: export educationMode 3 — CommercialpresenceInstitutional mobility:franchise/validated partner andInternational Branch CampusesMode 4 — Presence ofnatural personsStaff mobility: fly-in/fly-outprogrammes
  5. 5. 17 May 2013 5
  6. 6. How big is the global market fortransnational education?• No clear data on scale of the global market• Many countries do not record the overseas activities of theiruniversities• Some countries record enrolments of foreign franchisees andcampuses…• …but they cannot capture distance-learning• The UK and Australia do require their universities to reportoverseas enrolments• Use UK data to provide insight into the market17 May 2013 6
  7. 7. Relative growth of export and transnationaleducation in the UK17 May 2013 7Source: HESA
  8. 8. Surge in students studying for UK degrees abroadThe Guardian, 15 February 201317 May 2013 8•―International offshoots ofUK universities, partnershipswith foreign institutions andonline study mean there arenow more students on UKuniversity courses abroadthan there are internationaland EU students coming tothe UK to study‖―Look, there‘s one of those old-fashionedinternational students getting on a plane!‖
  9. 9. What kinds of transnational education?17 May 2013 9Source: HESA/SIEM2007/08 2008/09 2009/10 2010/11Overseas campus 7,120 9,885 11,410 12,305Distance, flexible anddistributed learning 100,345 112,345 114,985 113,065Other students registered atHEI 59,895 68,595 74,360 86,630Overseas partnerorganisation 29,240 197,185 207,790 291,575Other students studyingoverseas for HEIs award 70 35 50 125Total 196,670 388,045 408,595 503,700
  10. 10. But one kind is growing especially fast…17 May 2013 10Source: HESA/SIEM2007/08 2008/09 2009/10 2010/11Overseas campus 7,120 9,885 11,410 12,305Distance, flexible anddistributed learning 100,345 112,345 114,985 113,065Other students registered atHEI 59,895 68,595 74,360 86,630Overseas partnerorganisation 29,240 197,185 207,790 291,575Other students studyingoverseas for HEIs award 70 35 50 125Total 196,670 388,045 408,595 503,700
  11. 11. Caveat 1: the ―Oxford Brookes effect‖17 May 2013 112007/08 2008/09* 2009/10 2010/11Oxford BrookesUniversity870 163,295 162,045 239,945Source: HESA• Students enrolling part-time or online on ACCA level 3 courses areautomatically enrolled as Oxford Brookes students for 10 years• Once they have passed ACCA, they can write and submit a Researchand Analysis Project• If they pass, they are awarded BSc (Hons) in Applied Accounting• 16,554 students have graduated since 2000* Began reporting ACCA students as registered at Oxford Brookes
  12. 12. Caveat 2: headcount not full-time equivalent• Almost all (85%) of international students in the UK are full-time, paying fees of £10,000+• Most (>70%) transnational education students are part-time,eg:– 48% are Oxford Brookes/ACCA– 22% are distance-learning• Many course can be very part-time, allowing ‗study holidays‘and long completion times• Tuition fees for transnational courses are much lower (that isthe point!)• Revenue from transnational education is much lower thanfrom export education17 May 2013 12Source: HESA
  13. 13. ―Enrolments x tuition fees = revenue‖.Discuss.• The 239,945 ACCA students pay Oxford Brookes £135 tosubmit their projects, about 1% of the annual tuition paid byinternational students on campus• Oxford Brookes has 3,200 international students on campus• The revenue is equivalent to 260,000 ACCA studentssubmitting each year17 May 2013 13
  14. 14. Outlook for transnational education17 May 2013 14• S(domestic) =ƒ(domesticHE capacity)• D(domestic): ƒ(populationand GDP growth)
  15. 15. All other things equal• Demand for transnational education will increase:– If population (especially 18-22 years) grows– Per capita income grows• Demand for transnational education will decrease:– If capacity/quality of domestic higher education increases• In many developing countries, population and per capitaincome are growing…• …but governments are investing in major expansion ofdomestic higher education17 May 2013 15
  16. 16. The Higher Education Act, No. 101 of 1997• Promoting quality and developing capacity• Past and present projects:– Capacity Development and Training– Conversations on Quality and the Quality Assurance Fora– Good Practice Guides– Special Quality Promotion Projects– Student Participation in Quality Assurance (SPQA)17 May 2013 16
  17. 17. Balance will change by country and overtime17 May 2013 17Populationgrowth,GDPgrowthDomesticHEcapacity,regulatoryregimeHiLoTNEmarket
  18. 18. What about the supply-side?17 May 2013 18Interviewees Institutional AffiliationA Pro-Vice-Chancellor Russell Group university 1B International Director Russell Group university 1C Dean 94 Group university 1D International Manager 94 Group university 2E Pro-Vice-Chancellor University Alliance university 1F International Director University Alliance university 2G Associate Dean (Int.) University Alliance university 3H Dean Million+ universityI Director British CouncilJ Senior Manager UK HE International UnitK Senior Manager Northern Consortium UK
  19. 19. Attitudes to expansion of transnationaleducation: positive themes1. Broaden the market for UK higher education– ‘never will be more than a tiny minority [of students] who can gooverseas… There is going to be an increasing need for TNE because of thegrowing numbers going into higher education’.– ‘TNE is also becoming a core recruitment tool…some big universities havethe majority of their international students coming from TNE programmes’2. Build a global brand for UK universities– ‘any good research university needs to be globally connected… [TNE] hitsthe soft power agenda’3. UK government is driving TNE across all ministries– ‗[government] see TNE as a key part of export education, which doesn’tneed international students coming here’– ‘the British Council, the International Unit of UUK, UKTI, the new BIS unit,Education UK, they are all trying to get us to do TNE’17 May 2013 19
  20. 20. Attitudes to expansion of transnationaleducation: negative themes1. Risk aversion– ‘There have been lots of issues and there has been a reduction in theseprojects [franchising and validation]. They are very one sided’– ‘too many failed IBCs, like UNSW Asia and George Mason University’2. Some TNE activities are not scalable– ‘most [academics] do not understand or care…they want to concentrate ontheir research’.– ‘people see [TNE] as a pain in the arse’– ‘the QAA is so overstretched, how can we ensure that quality ismaintained?’3. Some forms of TNE are not sustainable– ‗[This] is not a sustainable model, you’re just plugging the gap until theirown sector fills it‘17 May 2013 20
  21. 21. Attitudes to expansion of transnationaleducation: negative themes (cont‘d)4. No pot of gold– ‘if it’s about making money, there are more interestingthings to do — you’ll never make money in themedium term’– ‘always a mismatch between promise and delivery…Projections in terms of numbers never materialise’– ‘the costs of tutors, academic overheads, etc are nottaken into account. If you included everything, youprobably dont make money’5. Internal resistance– ‘it is not our core business, we shouldnt be doingsomething that takes up resources that could be usedelsewhere’17 May 2013 21Oxford undergraduateshead for class
  22. 22. Conclusions• Transnational education wifely being seen as a growth industry• Data on scale of global market is spotty• UK data suggests that the market is large and growing, but datacurrently overstate the financial significance of the market• Balance of population/GDP growth vs investment in domestic highereducation will mean uneven and changing patterns of demand• For universities in UK study, most are cautious about expansion oftransnational education, with a number of inhibiting factors at work• Final thought: beware disruptive technologies likes MOOCs (fad orgame-changer?)17 May 2013 22