Higher-ed IT costs continue to rise

Technology spending among colleges and universities has swelled in recent years, but experts project only minimal increases from 2009-13, according to a report documenting a wide range of trends in higher education.

The Software & Information Industry Association’s postsecondary market report, released this month, details changes in college enrollment, the number of types of postsecondary schools, demographic changes, and fluctuating technology spending among institutions of all sizes, among other trends.

U.S. campuses spent $6.94 billion on education technology during the 2005-06 school year, marking a 35-percent increase from the $5.15 billion spent in the 2004-05 year, according to the industry report. Nearly every aspect of IT spending jumped in 2005-06, including a 23-percent hike in contracting outside services and a 50-percent rise in hardware costs.

Nicole Engelbert, a senior analyst for Data Monitor, a New York-based data analysis provider, said projections show that higher-education technology spending will slow to a rate of 1 to 2 percent annually from 2009-13, with many campuses seeing a drop in IT spending.

In 2008 and 2009, IT directors saw their campus operating budgets trimmed as the economy plummeted and colleges were forced to rein in costs during the current recession. IT chiefs’ expectations showed the change in fiscal attitude. Forty-five percent of technology administrators were expecting budget cuts in fall 2008, a marked increase from 16 percent expecting budget cuts one year earlier.  

With half of universities’ technology costs dedicated to new and updated hardware, experts expect cloud computing to help decision makers trim those costs in coming years by outsourcing some IT services. Mitchell Weisburgh, co-author of the SIIA study, said linking campus computers to a larger off-campus network will help schools slash costs associated with eMail and other services once provided by every college.

Forty-two percent of campuses included in the survey had converted to outsourced student eMail services, according to the survey, while 15 percent of colleges said faculty eMail had been outsourced. Google eMail –also known as Gmail– was the most popular option, with 56 percent of campuses choosing Google.

The SIIA study said this trend is expected to gain traction in higher education laregly because "unlike their predecessors, today’s students arrive on campus with an email addresses and established email identities and preferences."

Weisburgh, a managing partner at Academic Business Advisors in New York, said IT directors would have to make their case for new technology budget items in the next few years, since higher education operating budgets are expected to stagnate.

"You’re going to have to show that it will be something that will attract more students, reduce costs for the entire institution … or that it’s absolutely necessary for security on campus," he said. "You have to tie your request to something that will actually bring value to the university. … It’ll be a lot more like it is in corporate IT."

The postsecondary market report also showed that private institutions have spent more on IT in recent years, catching up to their public university counterparts. In 2003, private colleges spent about $70 million on administrative IT, compared to more than $200 million on public campuses. By 2005, private schools were spending more than $100 million, and public institutions’ average administrative IT costs fell below $200 million.

The SIIA data show a growing urgency for campus emergency alert systems, which often consist of text messages or eMails sent to students and faculty during a campus shooting or cases of extreme weather. A 2008 report conducted by the Campus Computing Project showed that 5.5 percent of U.S. postsecondary schools do not have an "operational emergency notification system." That number was 25 percent in 2007, according to the study.

Community colleges are more likely not to have an emergency notification system, with 13 percent reporting that they lack such a system. Only 2.8 percent of public four-year colleges did not have an emergency notification system. Every public university included in the survey reported an operational system.

The SIIA report said the growing frequency of emergency text message and eMail systems was spurred by horrific campus shootings in the past two years. These systems have become so common, in fact, that the market survey predicts that emergency notification companies will have to alter strategy to attract higher-education customers.

"These statistics should come as a surprise to nobody–after tragic shooting incidents at the Virginia Polytechnic Institute and State University (Virginia Tech) and Northern Illinois University, communicating to campus users instantly became a top priority," the report said. "Campus notification is thus reaching market saturation, and companies looking to grow in this area are going to need to steal market share through features, integration with other systems, or cost reductions."


Software & Information Industry Association

Campus Computing Project

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