One of the most striking things to me about the higher education side of online learning is how poor these classes are. It's really not that incredible that a tiny percentage of students ever finish a class. Now at this point, university people are saying, "Hey, this is no worse than our classes have ever been!" Exactly!
The big change here is that universities previously were built on the research reputations of their faculty. The fact that they actually had to teach was a burden. Believe me, my wife was a professor for many years. She actually loved teaching, but she was far from the norm. Think back to your college experience, how many professors would you give an "A" to? It was probably strikingly small. Going through engineering school, I would give an "A" to many more of my TA's than the professors and many more of my peers than my TA's. So what the universities have put online is literally their worst work - the work of professors who often know nothing about teaching.
I was on a panel a few weeks ago with a couple of MOOCs. I got tired of hearing about how millions of students were taking these classes. It's nice to have this much low hanging fruit, but your product can still suck. So I finally asked my other panelists what they did about students in their classes that were struggling. The most honest one actually said, "That's the student's problem, our job is to make sure we explain the content clearly." This insight into what higher ed thinks teaching and learning encompasses is incredibly illustrative. For the other 99% of students (not the ones the elite universities are used to "teaching"), every student in your class will have large gaps in their knowledge that keeps them from understanding what you are presenting, no matter how clearly you present. They won't be able to scurry around and fill all of those gaps quickly enough on their own to finish your course. Filling those gaps is actually what you do for a living.
I strongly encourage everyone in the higher ed space who has a broad mission to educate the students of the world (and not to just educate the ones they already educate, but do it online) to go out into the real world and figure out how to teach the other 99%. Udacity's work with San Jose State will be the greatest asset they develop for that company if they make it out alive. It is extremely likely that if they really get it, they will end up completely redesigning the process of teaching and learning in their system. I really hope others and the universities themselves do the same.
Here is the ironic part of the whole situation. The education schools at universities, often the ugly stepchild of higher ed, actually have people who spend their time understanding how the other 99% need to learn. It would be really great for people to walk over to the ed department and ask for help. I'm not saying ed departments are founts of knowledge, but they at least understand that the type of teaching happening for kids in k-12 gets much closer to what it takes for students to actually learn.