Online Colleges Surge with Marketing to Military

For-profit schools now account for 29% of active-duty enrollments. But critics say the shift leads to educational shortcuts and hyped marketing

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By Daniel Golden

(Bloomberg) — Marine Corps Corporal James Long knows he's enrolled at Ashford University, one of at least a dozen for-profit colleges making money off active-duty military with subsidies from American taxpayers. He just can't remember what course he's taking.

The 22-year-old from Dalton, Georgia, suffered a brain injury that impaired his ability to concentrate when artillery shells hit his Humvee in Iraq in 2006, he said. Long signed up for the online college, a unit of Bridgepoint Education (BPI), after its recruiter gave a sales pitch this year at a barracks for wounded Marines at Camp Lejeune in North Carolina. Under base rules, the barracks are off-limits to college recruiters, said Robert Songer, director of lifelong learning at Lejeune.

For-profit online colleges are taking over higher education of the U.S. military, lured by a Defense Department pledge of free schooling up to $4,500 a year for active members of the armed services, costing taxpayers more than $3 billion since 2000. The schools account for 29 percent of college enrollments and 40 percent of the half-billion-dollar annual tab in federal tuition assistance for active-duty students, displacing public and private nonprofit colleges, according to Defense Department and military data.

The shift is leading to educational shortcuts and over- zealous marketing, said Greg von Lehmen, chief academic officer of the University of Maryland University College in Adelphi, the adult-education branch of the state system and one of the earliest and biggest providers of military education.

Faster, Easier

"In these schools, the rule is faster and easier," von Lehmen said. "They're characterized by increasingly compressed course lengths and low academic expectations. One has to ask: Is the Department of Defense getting what it is seeking?"

Some online schools offer free laptops or fast degrees. At Apollo Group's (APOL) University of Phoenix, the biggest for- profit college, active-duty military personnel can earn an associate's degree, which typically takes two years of study, in five weeks.

Apollo fell 84 cents, or 1.4 percent, to $61.22 at 10:20 a.m. in New York in Nasdaq composite trading. The company's shares are down 19 percent this year through yesterday.

Taxpayers picked up $474 million for college tuition for 400,000 active-duty personnel in the year ended Sept. 30, 2008, more than triple the spending a decade earlier, Defense Department statistics show. Any college degree provides a boost toward military promotion, said James Pappas, vice president for outreach at the University of Oklahoma. Credentials from online, for-profit schools are less helpful in getting civilian jobs, especially in a tight labor market, Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers in Washington, said in an e-mail.

Disappointed Grads

"I'm afraid that the ease with which these outfits hand out diplomas is matched only by the disappointment of their graduates when they find out how little their degrees are actually worth," Nassirian said.

Mike Shields, a retired Marine Corps colonel and human resources director for U.S. field operations at Schindler Elevator Corp., rejects about 50 military candidates each year for the company's management development program because their graduate degrees come from online for-profits, he said in an interview. Schindler Elevator is the North American operating entity of Schindler Holding AG in Hergiswil, Switzerland, the world's second-largest elevator maker.

Broader Experience

"We don't even consider them," Shields said. "For the caliber of individuals and credentials we're looking for, we need what we feel is a more broadened and in-depth educational experience." He does hire service members with online degrees for jobs on non-leadership tracks, he said.