Stations May Suffer In For-Profit Schools Fight

I remember when I was a teenager and heard radio commercials predicting that within five years or so, there would be “a critical need” for 20,000 new disc jockeys. This could have never been true, and I’m really sure of that now that I found out Glenn Beck once was one.

But back then, had I gone to disc jockey school, I probably couldn’t have received federally-backed financial aid like the kind offered by all kinds of schools now.

In recent years, so called “for-profit” colleges, teaching topics like law enforcement, nursing skills, court reporting, computer programming and other professions can entice students with offers student loans. The trouble is that many students get in deep and later don’t snag that high-paying job they were counting on.

These schools happen to be very good advertisers. On buses. Online. And on TV.

You’ve seen ads for Kaplan University, DeVry Institute, the University of Phoenix and many other smaller operators. Whether you will see more may depend on how hard a new crackdown by the Department of Education and the Senate Health, Education, Labor and Pensions Committee is on the schools.

The government thinks the schools are making empty and expensive promises and want to do something about it. Students who wash out at these schools — and that may be more than half of them — begin careers at low wages, owing tens of thousands of dollars.

In the vanguard, the DOE last summer proposed a number of rules designed to tighten academic standards and protect students from overly aggressive recruiters. The rules would also require schools to provide prospective students with graduation and job placement rates.

Early next year, when this debate gets going again, look out. For broadcasters, the fear factor is that if some of the schools go away or get regulated more closely, hundreds of millions in ad revenue may be in jeopardy.

“That’s a lot of our money,” said one general manager who didn’t want to be quoted.

According to data from Kantar Media, for-profit colleges have spent nearly $148 million on TV ads from January to June in 2010. That’s just about the pace they spent in 2009, when Kantar data said they spent just over $294 million for the whole year.

And it turns out that government aid accounts for $24 billion of the revenue the career colleges got last year, according to a congressional study. Viewed another way, at 14 for-profit schools, federal dollars totaled 87% of revenue in 2009, according to a report presented by the Senate committee.

But defenders — and there are some surprising ones including Operation PUSH’s Jesse Jackson — argue that new rules would deprive minorities, the poor and immigrants of a path to the middle class. Others say traditional nonprofit universities also should be required to prove they’re doing a good job and just not overwhelming poor students with massive debt.

The for-profit colleges, of course, say they’re the right place for students, young and old, who need to develop marketable skills in a tight market.

Corinthian Colleges operates in several locations nationwide and has more than 100,000 students. Spokesman Kent Jenkins says Corinthian has no plans to change its college-specific advertising to students — 73% of which, he claims, leave Corinthian with a job in their field. “In a down economy like this, schools like ours do very well with people who are trying to improve their skills.”

“At traditional schools, people are groomed from birth that they are going to college,” says Bob Cohen, the spokesman for the Association of Private Sector Colleges and Universities, which until last month was called the Career College Association. “In the case of our students, many of them have been told since high school that they aren’t college material. It’s only after a few years that they hear a message or get the idea. The commercials are generating that awareness.”

Television is a perfect medium for the marketing of these schools because education is sold, unabashedly, as a product, just another thing that can improve lives. The ads offer a path to a career to people who may have never considered higher education before.

It’s hard to say what impact the closer government scrutiny will mean to the schools’ TV spending.

So far, it doesn’t appear to have had much impact. In the near term, you might expect an expansion of image-building campaigns by the bigger schools. The University of Phoenix acknowledges it just began a new flight of ads featuring success stories — just the kind Washington thinks for-profits don’t have many to tell.

But, long term, if the government tightens regulations and the amount of its money flowing out to schools, the money flowing into TV will likely slow, too.

Market Share by P.J. Bednarski, all about TV sales and TV sales people, appears every other week in TVNewsCheck. Bednarski is a longtime TV reporter and a former top editor at TV Week and B&C. If you have comments on this column or ideas for future ones, contact him at [email protected].