Some universities may close as a result of political and financial change in the sector, suggests a survey of senior leaders.
The study by a management consulting firm predicts further cuts in public funding to universities. Some 60 senior university leaders from across the UK responded to the survey, around a third of the total.
"It is clear that we are witnessing a sea-change in the dynamics of higher education", said co-author Mike Boxall.
Declining government grants, limits on undergraduate numbers, higher student fees and cuts to research funding have resulted in a dramatic shift in priorities for university leaders, argues the report by PA Consulting.
The authors detect signs of a switch among university leaders away from "their historical obsession with outlook for government policy and funding".
Instead the focus is increasingly "the competitive battle for fee-paying students", with a "new imperative" to offer "attractive and rewarding learning experiences", including better student access to academic staff.