As big boys form alliance, writing is on the wall for small players

In over three decades of working in higher education, the author has never witnessed such a challenging atmosphere. In the United Kingdom, the Office for Students has predicted that approximately 43% of institutions may face deficits in 2025–26, with 24 providers potentially closing within a year. Mergers are already occurring, such as the formation of the London and South East University Group by Kent and Greenwich universities.

Similarly, in the United States, EY-Parthenon reported 442 vulnerable private nonprofit colleges and universities, with about 26% of more than 1,700 institutions expected to close or merge within a decade. Japan's demand for university places could drop to 460,000 by 2040, only 73% of the current capacity, and over 40% of private universities are currently operating at a deficit.

In Malaysia, the number of private institutions fell nearly 15% from 436 in 2019 to 371 in 2025, primarily due to mergers, changes in status, and registration adjustments. This decline is attributed to demographics, costs, gig-economy opportunities, and the growing influence of artificial intelligence (AI). As students increasingly favor cheaper, flexible learning over expensive, generic programs, only trusted brands and institutions with strong finances or donors, distinctive programs, industry partnerships, personalized learning, flexible credentials, and lifelong learning will survive in this highly competitive market.

The new Triple Alliance between Sunway University, Monash University Malaysia, and Taylors in Bandar Sunway aims to address these challenges by pooling academic, technological, and infrastructural resources. The alliance enables shared research grants, facilities, and cross-institutional programs, breaking down internal silos and fostering entrepreneurial and management best practices.

However, it consolidates market share and prestige among elite member institutions, posing a significant challenge to smaller private universities that must form strategic alliances, mergers, and takeovers to survive.