It is all about what the market is willing to bare. If the market accepts the academic abilities of on-line courses they will begin to compete with physical universities. I think the major advantage that an online university are two fold. First it is easier to do online and work, I know I had to work my way through college the driving alone is hell. Second the online courses allow for less need of traditional Overhead costs. For example you don't need to pay for internet access the student covers that cost, you don't need to pay for security the student covers that cost ect.