I think it can be successful in a niche, but won't go too far. Universities have two main components: teaching and research. Udacity has a quite competitive te

I think it can be successful in a niche, but won't go too far. Universities have two main components: teaching and research. Udacity has a quite competitive teaching model -- there are cons compared to traditional schools, but also some pros. But they don't have a research model. For a professor to leave their school and work somewhere like Udacity, they have to pretty much give up their research in favor of the opportunity to teach many students (online), and the money. Some may be willing to make the tradeoff, but most of the best professors won't and probably never will. That's why I think the most successful online teaching programs will be affiliated with traditional universities. In CS, you could argue that the monetary resources needed to do research aren't as high, and you don't need specialized facilities. Maybe so. But you still need colleagues and collaborators -- especially in other fields like biology or engineering -- and you need grad students. And trying to do an online PhD doesn't sound very viable or desirable. And in other fields than CS, where you absolutely need facilities, centers, etc to do research, it will be even harder to attract good faculty to a place that has none of these. You could build them all and bring in grad students, but then you're just a copy of a traditional university with no undergrads, and it's not clear why you didn't just partner with a traditional university in the first place. So, this model may attract large numbers of students, but because of the research angle I don't see schools like these gaining the prestige and reputation necessary to draw students away from most traditional colleges.