Dive Brief:

• The University of Massachusetts System plans to launch a national online college focused on adult learners in order to stave off projected enrollment declines across higher ed and respond to growing competition, its President Marty Meehan announced Monday evening.
• Meehan said during his annual State of the University address that the system will use revenue from the online college to stay financially stable, with the aim to "lead through the coming disruption and emerge stronger on the other side."
• The system may partner with an online program manager (OPM) or other universities to build the online college's brand, The Boston Globe reported. Meehan cited national competitors in the online space, such as Southern New Hampshire University (SNHU) and Purdue University Global, as successful models it could emulate.

Dive Insight:

Meehan didn't mince words in his prepared remarks, which the Boston Business Journal obtained. "With the demographic decline, rising costs and limited access to new funding," Meehan wrote, "our ability to meet the future needs of the commonwealth and its economy are again in question."

Issues the UMass System faces mirror those of colleges across the country. Undergraduate enrollment, which is already on the decline at some institutions, is expected to plummet around 2025 due to low birth rates during the Great Recession.

But the situation is expected to be particularly dire in the Northeast, which is home to a large number of colleges. "Make no mistake — this is an existential threat to entire sectors of higher education, and New England is, unfortunately, ground zero," Meehan said.

Budget pressures have already caused a spate of closures among smaller colleges throughout the region. That follows a nationwide trend of college closings and consolidation, which analysts expect to pick up in 2019.

Large college systems like UMass may have more protection from the issues that lead to closure at small institutions, but they and other public systems face growing competition online from out-of-state competitors. 

"They're worried these big players may soak up market demand and that there won't be any room if they don't move quickly," Michael Feldstein, a partner with ed-tech consulting firm MindWires, told Education Dive.

That appears to be an area of concern for UMass. Meehan noted SNHU enrolls about 15,000 Massachusetts residents, mostly online, while the state system only enrolls about 5,600 students online.

UMass is not alone. This past summer, the State University of New York (SUNY) put out a request for information on ways to grow its online presence within the state and across the U.S. At the time, system Chancellor Kristina Johnson wrote in an email to SUNY presidents that it "cannot be left behind" while other colleges gain ground in online education.

Likewise, the University of Missouri System is eyeing online education as a way to provide a major boost to its enrollment before 2023.

Colleges that don't find a way to become relevant nationwide risk being bulldozed by larger entities with more "appropriate cost structures," wrote Matt Unterman, a principal at Grant Thornton, in a recent report.  

To achieve such scale, some colleges are turning to OPMs, which can help an institution quickly expand online, often without a large capital investment. Although OPMs used to be considered a one-stop-shop for colleges venturing online, more have taken on specialty roles as institutions demand a greater degree of flexibility in the relationship.

UMass may partner with an OPM to get its own national online college off the ground, the Globe reported. SUNY, for its part, is also considering such partnerships to help it achieve scale online.

"The time for us to act is now," Meehan said. "Over the next several years, there will be four to five major players in online education with strong regional footholds, and we intend to be one of them."