Right now there seems to be two poles of debate about the injection of technology into higher education. On the one hand there are the MOOCthusiasts who think Internet-based learning will disrupt the traditional college paradigm. On the other hand, there are the MOOC-fearful who worry that Internet-based learning will disrupt the traditional college paradigm. I'd consider myself on a third axis—skeptical that we really understand all that much about why people go to college or what it is exactly that videos on the Internet could possibly substitute for.
It's always helpful, I think, to step back from the question of education and just think about learning. Suppose you're curious about something. Like maybe articles about the recent banking crisis in Cyprus have made you curious about the island's history. The best first step, by far, is to go to the "History of Cyprus" Wikipedia page and read it. If you're still interested, maybe follow up with a book or two. Watching a person stand up and talk about Cyprus is pretty far down the list, whether you're watching the person live or on a video. It's true that if you want to learn how to tie a bowtie or to properly flip a Spanish tortilla, you may want to watch a video. The visual information is very helpful when you're talking about demonstrating a physical action. But to convey information? Reading is faster than listening, and buying a book—or checking one out from a library—has always been cheaper than paying college tuition, in part because when you go to college you still have to buy all these books.
Or, rather, book-buying has long been cheaper than college. College lectures arose at a time when books were very expensive and having some stand in front of a room and read a book so students could copy it down was a cost-effective way of conveying their contents. From a certain point of view it seems as if the printing press should have been the disruptive technology that put universities out of business. Surviving universities would reconfigure themselves as libraries staffed by people who are good at helping you find the right book. Then the relevance of the Internet would be that it makes the dissemination of text even faster and easier, letting us replace physical stockpiles of books with digital catalogs and search algorithms.
Obviously that's not the world we live in. But the question you have to ask about all this online coursework is why is it better than reading? I tried to prod Evan Soltas—who's an undergraduate at Princeton but could clearly get a professional writing gig in 15 minutes if he wanted to drop out—why he thinks people go to college since he, personally, clearly doesn't need it for either signaling or human capital purposes. The answer he came up with is that it's largely cultural, which I guess is right, but "culture" often serves as a kind of phlogiston in various discussions. I think the "weirdo factor" counts for a lot here, and it's not obvious to me how you would overcome it.