IN AUGUST, THE University of Arizona (UA) in Tucson announced that it would acquire Ashford University, a for-profit institution providing fully online education. UA will purchase Ashford from Zovio Inc., an education technology services company formerly known as Bridgepoint Education. Ashford currently serves approximately 35,000 students, enrolled in 50 associate’s, bachelor’s, master’s, and doctoral degree programs.
The acquisition of Ashford’s platform will support the creation of the University of Arizona Global Campus, which will allow UA to expand educational opportunities to underrepresented and nontraditional students. The partnership will expand both institutions’ existing capacity to track and assess data related to the preferences, behaviors, and achievements of online students. UA touts the creation of the campus as a measure that “embraces the opportunity to serve more international students—regardless of geographic location—who will benefit from [the Global Campus’] enhanced learning environment and resources.”
Unlike Ashford, the University of Arizona Global Campus will be a nonprofit entity. It will operate as a separate institution that manages its own academic programs and hires its own faculty. It will maintain its own accreditation through the Western Association of Schools and Colleges Senior College and University Commission.
With its creation of a new nonprofit online university, UA follows the lead of Purdue University, which completed its acquisition of for-profit Kaplan University in April 2018. The online education arm that resulted, Purdue University Global (PG), also acts as a separate campus within the university system. Purdue created PG as a means “to further the online education offerings in support of Purdue’s land grant mission,” according to its 2018 financial report.
UA’s announcement did not come without controversy. Inside Higher Ed recently reported that many University of Arizona faculty were angered by what they perceived to be a lack of transparency; most did not have an opportunity to weigh in on the decision prior to the August announcement, and those who did take part in the planning leading up to the acquisition were required to sign nondisclosure agreements. Others feared that any association with the for-profit university, which in the past has been accused of predatory recruitment practices, would tarnish UA’s own reputation. Many also worried that the acquisition came at a time when the university already had announced a potential US$250 million budget shortfall due to the impact of the COVID-19 pandemic.
UA has created a page of frequently asked questions in answer to these and other concerns. Regarding the financial impact of the deal, UA leadership notes that the university paid only $1 to acquire Ashford. That deal is similar to the one between Purdue University and Kaplan. In return, Zovio and Kaplan each receive a percentage of future profits generated by their respective partner’s online campus.
According to UA’s leadership, the acquisition of Ashford’s assets will generate “significant revenue for the University of Arizona and opportunities to substantially increase Arizona Online enrollment through transfer pathways.” However, whether either UA or Purdue will see their new online global campuses pay off in the long run remains to be seen. In its 2018 report, PG reported a net operating loss of $38.3 million. According to Forbes, PG experienced a $16 million operating loss in 2019, driven primarily by spending on marketing to attract new students. To many, these numbers suggest that both Purdue and UA are playing the long game with their creation of large-scale online campuses designed to serve a global audience of learners.
What the launch of the University of Arizona Global Campus means for UA’s Eller College of Management also is uncertain, says Paulo Goes, Eller’s dean and Halle Chair of Leadership. There will be a clear separation between the degree programs in business offered by the Global Campus and those offered by Eller, he explains. This is largely because Ashford’s programs are accredited by the International Accreditation Council for Business Education, while Eller’s are accredited by AACSB International. However, Goes views the larger university’s move to expand into the online education market as one that could benefit the Eller College in the future.
“While many details still are being finalized, we are seeking the right balance between separation and collaboration to ensure these two entities do not encroach upon each other and, in fact, come to complement each other,” says Goes. Once the new institution has launched, he says, there could be “tremendous opportunity” to advance Eller’s online programs.
The official launch of the University of Arizona Global Campus is planned for 2021. As part of the agreement, Zovio will provide services related to student enrollment and support, information technology, and financial aid services to the newly created institution.