NYUonline set to fold, poor revenues to blame

By By U Wire

By U Wire

NEW YORK?New York University is pulling the plug on its for-profit Internet education venture, NYUonline, because of lacking support from investors in the struggling economy, according to a report in Friday’s edition of The New York Times.

NYUonline is a private company run in conjunction with the university that offers non-credit online classes to business and professional clients.

In an NYU press release addressing the shutdown, University Provost Harvey Stedman said that because NYUonline is less profitable in the current economy, the company’s most successful programs will now be taught through the School of Continuing and Professional Studies (SCPS).

“Economic conditions have shifted, and the benefits of having a separate for-profit enterprise have diminished. Now the university is reassessing NYUonline’s technology and operations and is determining which activities will be managed by NYU’s School of Continuing and Professional Studies,” Stedman said in the release.

NYUonline’s specific programs are still being evaluated to determine which will actually survive the restructuring, University Spokesman John Beckman said.

Although the university invested about $1.5 million to start the company in 1998, which was the first of its kind for a major research university, NYUonline never actually turned a profit, Beckman said.

A “substantial portion” of NYUonline’s workforce is being laid off as part of the restructuring, although some staff members are being retained to “address the issues that remain outstanding,” Beckman said.

In the NYU press release, NYUonline CEO Gordon Macomber touted the company’s accomplishments, and said the progress made by NYUonline in the field of online education will be seen in retrospect as valuable.

“We have accomplished a great deal in our efforts with NYUonline. We have developed cutting-edge technology for delivering e-learning. We have served important clients in a new and exemplary manner. We have offered some insights as to how post-secondary education can and may be delivered in the future,” Macomber said.

“But, as we know all too well, the economic tide has shifted, and the enthusiasm for the capital markets for e enterprise has diminished. These forces have not been especially discriminating between those businesses, like ours, which are well-run and offer good services, and those which do not. I believe that the value of our work?will become even clearer with time,” Macomber continued.

In addition to the academic content of NYUonline that will be carried on by the university, Macomber said in the release that some non academic portions of the company’s work may be acquired by third parties, although he did not go into specifics.

U Wire