Entrepreneur Whittle Unveils Plans To Create Chain of For-Profit Schools

May 22, 1991 8 min read

By Mark Walsh

Washington--Chris Whittle, the media innovator who launched the controversial “Channel One” television news program for schools, last week announced plans to develop a nationwide chain of for-profit private schools that will be redesigned from the ground up.

Whittle Communications, of which Mr. Whittle is chairman, plans to spend more than $60 million over the next three years on a new division that will conduct research resulting in a “new American school,” he said, echoing some of the rhetoric used by President Bush in his recently announced education-reform proposals.

The firm later will seek $2.5 billion to $3 billion in capital to open some 200 private schools in major urban areas across the nation by the fall of 1996 that would incorporate the innovations developed by his research team. By the year 2010, Whittle expects to be serving as many as 2 million pupils at 1,000 school campuses.

“If it works, it is going to change American education,” Mr. Whittle asserted in an interview before his announcement here.

The 43-year-old media entrepreneur has faced scorn from many educators for introducing television commercials into high-school classrooms with Channel One, the 12-minute news program that includes two minutes of paid advertising.

Initial reaction to the Whittle schools plan was generally less hostile.

“From my perspective, it’s not automatically a terrible thing,” Bill Honig, California’s superintendent of schools and a major opponent of Channel One, said of Mr. Whittle’s plan. “If somebody wants to spend big bucks on how to make schools better, that’s fine. The dangers are if you have a profit-making institution, who’s to say that cutting costs and cutting corners won’t be undertaken to increase profit margins.”

Albert Shanker, president of the American Federation of Teachers, said, “Chris Whittle has a right to do this. He might just come up with something that is damn good. But [the schools] also could be crassly commercial.”

‘A Complete Redesign’

The proposed “Whittle schools” would serve all children, including the handicapped and others with special needs, from “age 0 to 18,” Mr. Whittle said. There would be no admission requirements; if demand for a school exceeded available space, applicants would be selected randomly.

As part of its three-year research effort, Whittle will devise ways to offer this education less expensively than the average per-pupil cost in the nation’s public schools, currently estimated by the Education Department at $5,638 per year.

The tuition charged for each school would be just below the per-pupil cost of public education in its community, he added. Over all, 20 percent of Whittle students nationwide would be on full scholarships, he said.

One way to achieve the goal of underpricing local public schools, Mr. Whittle said, is to “harness student power” to reduce support staff and bureaucracy. Thus, as part of their schooling, students would work somewhere in the facility, and likely would be called on to teach younger pupils.

A Whittle school may well look nothing like today’s, Mr. Whittle said. He envisions a school in which each student would have his or her own computer workstation and would learn from software and video texts developed by the firm.

The Whittle research team would have free rein to redesign the school buildings, to dissolve the traditional boundaries between subjects, and to re-evaluate traditional grade levels.

“We need a complete redesign of the way we teach our children,” Mr. Whittle said. “This means we cannot begin with the system we now have.”

Mr. Whittle stressed that while the proposed Whittle schools would be a profit-making venture, they would be undertaken with a larger public purpose--to demonstrate a reshaped notion of schooling unburdened by multiple layers of educational bureaucracy or by unwillingness to veer from the status quo.

Public or other private schools would be invited to copy the Whittle approach or to purchase the firm’s software. Whittle would also be receptive to offers to manage public schools or entire systems, Mr. Whittle said.

Mr. Whittle has dubbed his research effort the “Edison Project,” an allusion to the revolutionary shift from candlepower to the light bulb.

The effort, expected to involve some 100 educators, business leaders, scientists, and others is similar in many ways to one of the major pegs of Presi8dent Bush’s America 2000 plan to reform education, which calls for a $150-million effort to award research and development grants to redesign American schools.

Mr. Whittle’s firm will not seek one of the grants, he said.

Roger D. Semerad, head of the working group that is establishing the New American Schools Development Corporation that is backed by President Bush, said he welcomed Mr. Whittle’s research.

“Between the Whittle effort and America 2000, I am more encouraged that some group is going to come up with very practical yet ambitious plans for designing these new learning environments,” said Mr. Semerad, who is also the president of the rjr Nabisco Foundation.

Mr. Whittle said U.S. Secretary of Education Lamar Alexander had no formal role in developing the firm’s schools plan, despite his close ties to the Knoxville, Tenn.-based company before joining the department.

Mr. Alexander, the former governor of Tennessee, was a paid consultant to Whittle Communications after leaving office. He transferred an option to purchase $10,000 in private Whittle stock to his wife, who bought it and sold it later for a large profit.

The Education Department’s official statement on the Whittle plan came last week from Deputy Education Secretary Ted Sanders, who said that, “with more than 110,000 elementary and secondary schools in this country, there’s room for everybody on the reform bandwagon.”

“Ted Sizer, James Comer, Henry Levin, and Chris Whittle are among those who have proposed the kind of break-the-mold schools called for in America 2000,” he said, referring to several notable reform advocates.

Born of Anger

Until last week, Mr. Whittle’s name was associated more with innovative forms of media than with school reform. Beginning with a publication for incoming freshmen at the University of Tennessee that he co-founded in 1970, Mr. Whittle has built a communications empire that has rescued Esquire magazine (since sold) from extinction; installed advertising-supported wall posters in thousands of schools, doctors’ offices, and hospitals; and developed ad-supported books and commercial-television systems for high schools and doctors’ offices, among other projects.

Mr. Whittle said he became intensely interested in transforming schools during his efforts in recent years to promote Channel One, which has been received negatively by many state education officials despite its use in 9,000 schools across the country.

“We got angry at some of the bureaucracy of education,” he said.

The initial $60 million for research will come from Whittle Communications, which is half-owned by Time-Warner Inc., the media giant, and one-third owned by a British newspaper publishing company.

If the decision were made to proceed with building schools, Mr. Whittle said he could attract the $2.5 billion or more needed for the first phase from banks and other investors, including companies with an interest in selling products to the schools, such as the major computer companies or food-service firms.

What is more uncertain is the marketplace that Mr. Whittle would face by opening his schools in an arena in which many not-for-profit institutions are already struggling.

No major corporations are involved in for-profit elementary and secondary education on the scale proposed by Mr. Whittle, although numerous companies offer services around the edges of basic education, such as child care and after-school supplementary education for remediation and college preparation.

A number of corporations are said to have explored the possibility of opening for-profit schools, only to be daunted by high start-up costs and other factors.

Fear of Advertising

Mr. Whittle plans to begin by serving pupils under age 1 through age 6. For this age group, many parents are already paying $5,000 or more a year for child care, so they may be more willing to continue with a school with which they are comfortable, Mr. Whittle reasons, even as free public education becomes available for their children at about age 5.

The schools would then add one grade a year through 12th grade.

“He’s a smart guy, and he has probably found a niche that may be a profitable future industry,” said John Kaegi, senior vice president of Kinder-Care Learning Centers Inc. of Montgomery, Ala., the nation’s largest child-care chain. “But we have found that parents don’t want schooling for their preschoolers. They want their children to learn, but they don’t want formal schooling at that age.”

One major fear of educators is that a school developed by Whittle is likely to have a liberal exposure to advertising, from Channel One to advertisements in the hallways and textbooks to curricular materials sponsored by corporations.

“Whittle’s plan is profit-motivated and depends on the sale of advertising, tuition, textbooks, and who knows how many other allied products,” said Gary Marx, associate executive director of the American Association of School Administrators. “Both public and private educators, and certainly the American people, should be wary.”

Mr. Whittle said that, indeed, his schools would more than likely show Channel One, and expose students to other advertising. But tuition, not advertising revenue, would be the primary source of funding, he asserted.

A version of this article appeared in the May 22, 1991 edition of Education Week as Entrepreneur Whittle Unveils Plans To Create Chain of For-Profit Schools