Commercial bent on the cards for unis

Universities face a period of transformation in the decade ahead, with the likelihood of greater industry engagement and an exploration of disruptive business models.

That’s according to new research from consulting firm EY, which drew on interviews with more than 50 university leaders, policymakers, and industry observers to assess how Australia’s universities will operate in the coming decade.

Its final report, released earlier this month, posited four scenarios for the sector, in which universities would either follow traditional, commercial, disruptive, or virtual models of teaching and research.

Commercial universities were thought to be the most likely model embraced by the sector.

That model would feature less regulation from government bodies, greater competition, greater funding from industry than from governments, and the removal of price caps for degrees.

By contrast, the virtual university model, deemed the most extreme scenario, would feature an active government that integrated higher and vocational education, funded universities at a greater rate than the private sector, and placed caps on degree prices.

Of the four scenarios put forward, the commercial model was thought to be the largest revenue generator, with the number of universities growing from 43 to 60 and overall revenue for the sector rising from $30 billion to $57 billion.

Disruptor universities, which were labelled providers of educational services rather than higher education, would generate just $35 billion but would teach the most students, with learners growing from 1.4 million to 7 million.

The number of Australian universities would shrink in this scenario, however, from 43 to 40.

Dawn Freshwater, who was vice-chancellor of The University of Western Australia between 2017 and 2020, is quoted in the document as saying universities would remain vital places for the development of global citizens while working for the purpose of national and regional development.

“In the future, the university campus will become a precinct that interfaces university and society, with startups, community organisations and social enterprise intermingling with the students: there will be full integration with society and industry,” she said.