Interesting piece by Lee Gomes in MIT Technology Review.

Harvard, by many measures the most prestigious college in the U.S., has been at it for nearly 400 years. Ben Nelson, founder of an online education startup called the Minerva Project, says he can do equally well in just three.

Minerva is one of the least-publicized but also most well-funded and audacious of the current crop of online education startups. Funded with $25 million from Benchmark Capital—one of the well-known venture-capital firm’s largest-ever investments—Minerva says it will begin accepting applicants in 2015 for an entirely Web-based college program. The resulting undergraduate degree, it promises, will have all the prestige of anything the Ivy League can offer, but at half the cost.

Many people would dismiss Minerva’s notion of some sort of instant online Harvard as the fever dream of someone who had sat through one too many TED talks. But the for-profit company’s assumptions about how the Internet will change education can be found, to varying degrees, in most of the scores of startups now getting venture money to do instruction online.

The level of venture-capital investments in education has nearly doubled in 2011, and now rivals figures last seen during the dot-com boom. Representative of the crop is Coursera—formed by two Stanford computer scientists—which offers a growing list of free online classes (see “The Technology of Massive Open Online Courses”). Even though Coursera has no clear plans for how to make money, an investor involved in its initial $16 million financing said other top VCs pleaded by phone and e-mail to get in on the deal, regardless of the price. It’s the sort of enthusiasm that often signals a tech investing bubble.

Hmmm… I think I’d read this as Round Two of the 1999-2000 fantasies about online education. It smacks of Fathom.com. But the movement started by Peter Norvig and Sebastian Thrunn will eventually have a disruptive effect on Higher Ed. The $64B question is how MOOCs will eventually start to disrupt conventional, lower- and middle-range HE providers. The Harvards, Stanfords and Cambridges of this world will be largely untouched by these developments, largely because they are really selling positional goods as much as an educational experience.