That Swipe Reader

So what does it mean that Vassar has a BlackBoard branded card swipe reader on their elevator? A great deal, actually. During the tech boom companies like BlackBoard and WebCT were setting their sights on virtually minting their own currency as universities became transformed by the Internet. "Bricks to Clicks" was one pet phrase of the digerati. Of course, it didn't happen. One of the more spectacular failures, Fathom, burned through millions of dollars of Columbia University's money, as did similar projects at NYU among others. This isn't to say that it didn't work at all as evidenced by such ventures as the proprietary University of Phoenix, but tranforming education is a tricky business. It isn't just about the delivery of instruction after all. In K-12 we don't just teach kids, but babysit, feed and inoculate them as well. In some school districts most kids might just get their only nutritious meal of the day thanks to a school. In higher education we aren't just teaching kids, but socializing them and providing them with a health club too. I'm not too crazy about the health club part.

Universities do something spectacular that you really can't replicate with an Internet business model: they incubate and produce scholars in a community of practice. This is really the core business of the university, and while a course management system or portal technology can help it doesn't replace the buzz you get when you walk into the cafeteria at Rockefeller University and realize you just spilled coffee on a Nobel laureate. Sure, they all use e-mail, but proximity and the TLC provided to professors is what creates brilliant scholarship and those things that only a university can really do better than anything else. So much for "transforming" higher education.

So BlackBoard isn't printing money and the founders will not be as rich as Bill Gates as they stand over the ivy-covered rubble. You still have to make a living though. If the card swipe is any evidence it looks like now they are getting into the business of not just course management, but also that of running the data infrastructure needed to process financial aid, registration and other such computer-intensive jobs that colleges need to get through the year. How will they do? Considering that much of BlackBoard is cobbled together from shareware and that they aren't really all that big a company I'd bet that Computer Associates, SAP, IBM, Oracle and PeopleSoft probably will not allow them to take a business that they already understand and can do quite well. They'll also want the business that BlackBoard has with China. So I think the future for BlackBoard is to be bought out at some point, especially if it goes public. PeopleSoft or Oracle would be well-served if they killed BlackBoard like a python does a chicken. What is interesting is that Robert E. Grady of the Carlyle Group is on their board of directors, so they might just be so well connected that they might just be one phone call away from some pretty lucrative business. Only time will tell.