Online program managers, commonly referred to as OPMs, are dramatically down in funding, investment and buy-in from higher education and related stakeholders, according to a quarterly update from Validated Insights, a market research company.
From 2019 to 2024, the proportion of colleges and universities reporting interest in partnerships with OPMs has declined eight percentage points to 34%. And while the number of new partnerships formed in the first half of 2024 has declined by 56.1% since 2023, the speed at which partnerships are ending or are being terminated is accelerating. A record 147 OPM partnerships ended this year.
Following 2U’s bankruptcy filing due to limited cash flow and high debt, Fordham University’s decision to object to the OPM giant’s restructuring represents one of the latest institutions attempting to terminate a partnership. The private New York City University claims 2U failed to deliver on its promise of gaining students access to internships, Washington Business Journal reports. This isn’t the first time the company, once prized for its $800 million purchase of edX in 2021, has faced criticism for its instructional quality.
Clemson University’s partnership with Coursera and Hawaii Pacific University with Beacon Education represent two of the most popular new partnerships of 2024. Hawaii plans to use the OPM to deliver programs to its Chinese audience, according to Validated Insights.
Investment in OPMs has also shockingly decreased. Since its peak in the second half of 2021 and the first half of 2022, total funding for these companies has declined 97% up through the first half of 2024.
Why did the OPM hype freeze?
Validated Insights attributes the decline in the number of institutions willing to partner with OPMs to three reasons. For example, institutions frustrated with unmet promises are now focusing more on internal capabilities to jumpstart their online programs.
Secondly, delayed guidance by the Department of Education has left many OPM providers in limbo on knowing how aggressively they can be monitored and audited. The presidential election will significantly determine whether federal regulators will be able to deem them third-party services, which would subject them to tighter regulation. Minnesota has decided to altogether ban its public institutions from striking partnerships with OPMs that agree to revenue-sharing models due to the “pernicious, deeply deceptive approaches” they take to enrolling students, Nathan Coulter, a Minnesota House lawmaker, told New America.
Lastly, there may be fewer colleges in the market willing to partner with OPMs simply due to there being fewer colleges open today.
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