The University of Phoenix, once the largest online university in the US, has been trying without luck for two years to sell itself to a traditional higher education system.

The 47-year-old for-profit institution, which once neared $5 billion (?4 billion) in annual revenue from 500,000 students at more than 130 campuses, has been trying since early 2021 to convince prospective buyers that it represents a valuable model of online institution reborn to dominate adult-oriented higher education.

Phoenix, now down to about 80,000 students, almost all online, has been aiming its sales offer at state university systems, warning them in a marketing pitch that its offer represents a best and final chance at gaining an experienced partner for making a large-scale move into online education.

¡°The number of scaled institutions with the technology infrastructure and experience to thrive in online education is limited, and the space will only continue to further consolidate,¡± Phoenix argues in its marketing brochure.

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The so far unsuccessful attempt by Phoenix will likely stand as a landmark moment for US higher education, said policy analyst Barmak Nassirian. ¡°It says as much about the sorry prospects of public higher education in the US as it says about the fate and fortune of for-profits,¡± Mr Nassirian said.

US public universities have lost so much state funding in recent decades that many appear desperate to find new revenue sources, said Mr Nassirian, vice-president for higher education policy at Veterans Education Success. And yet so far, none appear to have accepted Phoenix¡¯s entreaties, perhaps having seen similar mergers faulted as attempts to bolster traditional universities by?perpetuating for-profit models?that exploit minority non-traditional students.

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The effort by Phoenix came into public view with reports that the University of Arkansas system is among the prospective buyers. Documents released by Arkansas illustrate the wider sales campaign by Phoenix,?dating to the very beginning?of the Biden administration, which took office promising?a renewed crackdown?on the for-profit sector.

Arkansas¡¯ negotiations with Phoenix suggest a sales campaign that¡¯s foundering on issues of trust in the company and its business model. The chair of the Arkansas system¡¯s trustees, Cliff Gibson, is a leading sceptic, based on Phoenix¡¯s poor reputation and his system¡¯s previous online ventures.

The Arkansas system created its own online unit, eVersity, a decade ago, with $5 million provided from its campuses. ¡°And here we are, basically 10 years later, and the money has not been paid back,¡± said Mr Gibson.

Arkansas expanded eVersity in 2021 with the $1 purchase of the distressed online for-profit Grantham University, adding 4,000 students to its 800-student online-only unit. But Mr Gibson said he has not been provided with enough information to judge the results. ¡°That caused me some concern,¡± he said, ¡°and it¡¯s more concerning now that we¡¯re thinking to jump off in the deep water.¡±

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The idea of buying Phoenix has been pushed by the Arkansas system¡¯s president, Donald Bobbitt. A spokesman said that exploring the offer fits the system¡¯s mission ¡°of providing affordable, relevant education to a broad range of students and introducing the UA system to new educational markets¡±.

US public institutions that have made major jumps into the online realm include Purdue University, with its purchase of Kaplan University in 2017, and the University of Arizona, which bought Ashford University in 2020. They and others have been following Southern New Hampshire University, which over the past two decades has grown from a small regional private institution to an online giant of more than 170,000 students.

Phoenix argues in its sales pitch that building such an entity from scratch now looks exceedingly difficult.

¡°Universities with scaled and effective online platforms like ASU, SNHU and the University of Phoenix will remain leaders in the market,¡± it says, ¡°while smaller and newer online programmes will struggle to differentiate and gain traction.¡±

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paul.basken@timeshighereducation.com