I will reply to your points eventually, Billy, I'm just adding fodder for now. 



Frighteningly Ambitious Startup Ideas
http://www.paulgraham.com/ambitious.html

3. Replace Universities

People are all over this idea lately, and I think they’re onto something. I’m 
reluctant to suggest that an institution that’s been around for a millennium is 
finished just because of some mistakes they made in the last few decades, but 
certainly in the last few decades US universities seem to have been headed down 
the wrong path. One could do a lot better for a lot less money.

I don’t think universities will disappear. They won’t be replaced wholesale. 
They’ll just lose the de facto monopoly on certain types of learning that they 
once had. There will be many different ways to learn different things, and some 
may look quite different from universities. Y Combinator itself is arguably one 
of them.

Learning is such a big problem that changing the way people do it will have a 
wave of secondary effects. For example, the name of the university one went to 
is treated by a lot of people (correctly or not) as a credential in its own 
right. If learning breaks up into many little pieces, credentialling may 
separate from it. There may even need to be replacements for campus social life 
(and oddly enough, YC even has aspects of that).

You could replace high schools too, but there you face bureaucratic obstacles 
that would slow down a startup. Universities seem the place to start.

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