Sell-off jeopardises e-university venture

New owner of the US partner in global e-learning scheme may withdraw cash support, reports Geoff Maslen

The future of an online university established by the Universitas 21 international consortium is uncertain because its American partner, Thomson Learning, is being split in three and the divisions sold off.

U21Global was set up five years ago to deliver masters and graduate diploma courses over the web. It launched its first MBA in 2003 and has 3,000 students based mostly in India, China and the Middle East.

It is a joint venture between Universitas 21's 19 research-intensive universities and Thomson Learning, owned by the giant Canadian-American company Thomson Corporation, with both sides contributing $25 million (£12.7 million) each.

It is unclear whether the future owner of the higher education division will want to invest in U21Global - which is not expected to make a profit until 2008.

Universitas 21 was initiated in 1997 by Alan Gilbert, vice-chancellor of Manchester University, when he headed the University of Melbourne. Four UK universities are members: Birmingham, Edinburgh, Glasgow and Nottingham.

Professor Gilbert floated the idea of a virtual university to tap into what was claimed to be a $200 billion a year industry of unmet demand for higher education from 32 million students.

Six years ago, he predicted that by 2011 the e-university would enrol more than 500,000 students, with Melbourne alone earning $40 million a year from the sale of courses.

Melbourne has so far contributed more than $15 million to the venture but has yet to see any return on its investment.

Mukesh Aghi, chief executive of U21Global, said he was not concerned about the sale of Thomson Learning. He said: "Thomson Learning sees us as one of the crown jewels in its assets."

* The University of Sydney has clinched a deal potentially worth as much as A$75 million (£30 million) to host a new American studies centre.

Australian Prime Minister John Howard has committed $25 million to the centre and substantial sums are expected to come from industry.