A Netflix-Style Tuition Model at Boise State University

The sticker shock of higher education prices hits students early. First-generation college students in particular may not anticipate the total expense of the university experience. Tuition, living expenses, transportation and books add up quickly.

Plus, students can feel anxious about the benefits awaiting them on the other end of a bachelor’s degree, having heard from alumni who wish they’d made more cost-effective choices. The whole system leads students to ask, “Are the costs of a college degree worth it over time?”

Peter Risse, Associate Dean of Extended Studies at Boise State University, joined the podcast to talk about how they’re following Netflix’s lead at Boise State with a subscription-based tuition model option.

What Is Passport for Education?

“Passport is our attempt to introduce some better predictability in terms of time spent and needed to approach somebody’s educational experience,” Peter said. “It gives us a chance to provide greater predictability related to budgeting, and it gives the student cost certainty over time.”

Fundamentally, Passport to Education is a monthly subscription commitment by Boise State students and their partner credit union to help adult learners build education into their busy lives.

Student Retention Benefits of a Subscription-Based Tuition Model

“We built Passport to Education with two different levels that a student can pursue,” Peter said.

The first is Passport 6, which is six credits available for fall, spring and summer semesters, and the second is Passport 9, which is nine credits, fall, spring and summer.  Passport 6 costs students $425 a month for every month during the course of that year, and Passport 9 runs $550 per month during every month of that year.

Students save 19% using Passport 6 and 30% using Passport 9. “We anticipate that that savings will increase over the course of the next year as tuition rates are expected to increase,” Peter explained.

Many enterprise companies choose subscription-based models because it creates steady and renewing revenue, and it often improves customer retention by removing the constant choice required from the customer. In higher education, by contrast, we are asking students to recommit and re-decide every term if they want to keep going with this very hard thing — earning their degree. So we asked Peter, “Do you anticipate seeing improved retention rates because of the psychological benefits of this subscription-based model?”

He said it’s helpful to think that we can help a student predict and budget their time and financial commitments for their degree. If they can look at their education in the long term rather than on the semester-by-semester basis, and see the benefits for finances and life planning. It’s a huge benefit.

Future Plans for Passport to Education

Boise State is still in the startup phase of this program and is working to prove the concept.

At this stage, Boise State is using two adult-focused programs — the bachelor of arts in multidisciplinary studies and the bachelor of applied science program. These two degrees are purpose built to serve adult and non-traditional audiences.

“The multidisciplinary studies program itself is for those students who have some college but no degree yet,” Peter said. “It’s highly customizable, and allows students to design their program based on what their personal and professional goals are.”

The bachelor of applied sciences is really built for folks who have earned a technical degree, including students coming out of the military, who might already hold a community college degree. These students can apply up to 40 technical credits to an applied sciences degree.

“So they really get a jump start,” Peter said, “rather than having to start from the beginning”

Early Student Feedback for the Subscription-Based Tuition Model

“The students really like the level of student support that they’re getting from the advising staff and their faculty,” Peter said. “They like the quality of the online experience that they have.”

Boise State has invested a great deal of time and effort to build out these programs so that they’re adult focused and friendly. And adult students appreciate the opportunity to move through their educational experience more quickly. In fact, the students that are coming in are making use of the nine-credit option far more than Peter and his team anticipated.

“About 54% of the students that are currently involved are in the nine-credit option,” Peter said. “So they’re moving through very quickly.”

Next-Steps Advice for Institutions Considering Subscription-Based Tuition Models

“Gaining early buy-in is essential,” Peter told us. “We’re fortunate here at Boise State to have an innovative mindset, and people are able to wrap their head around taking a chance on something like this.”

It takes more than interest or even buy-in, though. You need the right technology, too. Are your systems capable of accepting monthly auto deduct payments? Can you move a large system into a new phase?

Each situation is different, but a senior leader who wants to try this can make a big difference.

This post is based on a podcast interview with Peter Risse from Boise State University. To hear this episode, and many more like it, you can subscribe to Enrollment Growth University.

If you don’t use iTunes, you can listen to every episode here.