I have done mixed online/in-class courses and have mixed feelings about teaching online. One of the good things about it, for the students, is that it makes instruction available at more times. Also, it means that instruction and guidance aren't limited to class time or the professor's office hours. On the other hand, it's not such a boon for the student who learns more from, and responds better to, face-to-face contact. Plus, potential employers and graduate schools don't view online courses and degrees as favorably as their counterparts from brick-and-mortar schools.
Whatever the merits and demerits of online learning and teaching, I think it is the direction in which education will continue. Administrators love it because it exponentially increases the number of students who can be enrolled in a course. That means, of course, it is less expensive--for the school, anyway--to run such a course. Whether they'd pass the savings on to the students or not is another story.
Now that I think of it, the day may come when the administrators have no choice but to run more, if not all, courses online, and to lower their tuition. I'm no economist, but I don't see how the current system of financing education can continue for much longer. Of course, it will be of no concern to students from wealthy families. Other than them, very few students can afford to attend any sort of post-secondary school without financial aid, whether it's from scholarships, the checks their parents write for them or the loans they take out.
I don't know whether the number of scholarships will change. However, I would expect that, at some point, parents won't be able to afford to write those checks, or they (or their kids) might decide that a degree won't open enough doors to make school worth those checks. Perhaps most important of all, the governments can't continue to subsidize schools and loans without tax increases or cuts to spending in other areas. And banks that are getting out of the student-loan business won't re-enter that market unless the risks are eliminated. Again, I might be showing my ignorance, but I simply can't see how those risks will be eliminated unless there is a dramatic long-term improvement in the employment prospects for graduates with the sorts of degrees most graduates get, or whether they can pass the risk along (i.e., through derivatives) as they did during the housing bubble. We have seen how that ended!
So, if available funding dries up--and, with it, the educational-financial complex falls apart--the move to online learning could accelerate. That could have all sorts of serious, and possibly interesting, outcomes. The best-case scenario, if schools close down as the money spigot is turned off, is that the learning they provided will still be available online. That could further accelerate the decline of the current system, which might make credentials less important. Then, self-motivated people will go online--or, if they don't have access, will turn to books and people who are knowledgeable about whatever interests them.
On the other hand, the closing of so many schools might lead to the concentration of education in fewer and fewer hands. Stanford Professor Sebastian Thrun has predicted that in 50 years, only ten institutions in the entire world will be providing higher education. That might not be such a terrible thing if, as I've said, the actual education is more valued than the degree that's supposed to represent it. More important, having fewer schools will be a benefit--or, at least, won't limit opportunities--if everyone has access to the Internet or whatever will replace it in 50 years. As best as I can tell, the only people who believe that will happen are those who are technology-savvy and live in the industrialized world.
So, one way or another, online education will probably change, if not destroy, the model of "higher education" we now have. The only question is: Who, if anyone, will benefit?