A pediatric patient with a heart valve problem receives an MRI in Columbus, Georgia. The image is read using tele-radiology technology by an expert in neonatal cardiology in Atlanta, 250 miles away.

A 63-year old man presents with stroke symptoms to a Knoxville hospital emergency room at 2 a.m. The neurologist on call is at home, sensibly asleep, and 45 minutes away. Time is everything with a stroke. The neurologist is phoned, he orders a CT scan, and the neurologist, still in his pajamas, reads the scan on his secure laptop using a tele-neurology software application. There is no stroke. The patient is ordered to be held in an observation bed overnight and the neurologist returns to bed. The patient will be released the next morning if he remains asymptomatic.

A primary care doctor seeing a diabetic patient senses she is anxious and possibly depressed. In times past he would hand her off to an assistant to schedule an appointment with a psychiatrist. Most patients never keep such appointments. This doctor, however, has a special tele-video room with a secure link that allows her to receive a remote psychiatric examination on demand with the assistance of a local nurse. The video camera, operated remotely by the psychiatrist, can zoom in on the patient’s pupils or any other body feature.

These three examples of the growing use of telemedicine are important trends in healthcare. They admit the fact that medical expertise and medical need are not always required to be in the same place. With the proper access points, medical expertise can be exported anywhere, bringing healthcare to people who would otherwise be deprived of it, or who need it immediately. The tele-video room mentioned above was used earlier in the day to allow a cross-town dermatologist to examine a lesion discovered during a routine physical exam of a patient and suspected to be melanoma.

Virtual places and remote presence applications are spreading to other industries as well like security, manufacturing, and education. It could potentially revolutionize the delivery of educational content around the world, reaching the poorest and most educationally deprived places on the planet.

One of the most recent innovations in educational content delivery is Massive Open Online Course (MOOCs). They are massive because there’s no limit to how many students can concurrently take a course. Often students are scattered around the world. They are open because anyone with browser access can enroll in the course, most of which are free at this time. Obviously they are online and the courses I’ve taken follow a curriculum. Many of the courses are archived, so a person could take a course that has been completed and closed and go through it at his own pace.

With college tuitions rising faster than inflation, innovations like these are sorely needed. Teaching pedagogy hasn’t changed since the beginning of time and we need to find ways to make students smarter faster and at less cost. Reducing the number of years required to obtain a college degree would reduce the cost. There’s nothing magic about four years, and if colleges operated year-round, it would be possible to graduate in three years. A number of colleges now do that.

Moving courses online that don’t receive a benefit from classroom delivery is another way to cut cost. Faculties howl at this idea, predictably refusing to be insignificant in all content delivery. But it’s hard to make a case that a classroom and professor add much to courses like introductory statistics, basic economics, math, and computer programming whose “learning” mostly involves the mastery of fundamentals.

Online course-taking can be self-paced – a big plus, since the pace of traditional classroom teaching is pitched to the average student, meaning half of them struggle to keep up. Mini-exams could be inserted after each online learning unit, which are computer graded with prompts that help students understand their errors. Until a unit is mastered, the student would not be allowed to proceed. And teaching assistants would be available to help students who need it either in special chat rooms or face-to-face remedial classroom sessions.

MOOC providers like Coursera and Udacity offer these kinds of courses online and free. Students who take them and master the content should be allowed to take comprehensive exams that exempt them from taking the college’s traditionally taught course offering. Some colleges already allow exemption exams. Others, protective of turf and brand, don’t. But the fact is about half of the first two years of college could easily go online.

The curriculum of a college was once a unique differentiator among competitive colleges. No more. Curricula are becoming commoditized and delivery methodology will become the future differentiator. Computer simulation now allows students to experience content impossible with a chalkboard or PowerPoint presentation. In the “old days” the jaw-dropper for an Excel spreadsheet was its ability to show how a model responded to changes in inputs – immediately. With enough computer horsepower, online simulation allows an even more robust demonstration of complex model behavior. Crowd panic behavior, weather patterns, engineering failure analysis – any rule-based model can be integrated into online studies – a functionality unknown in traditional classrooms a decade or two ago.

Open online course critics like to point out that online courses don’t allow the professor-student interaction possible in a classroom. Well, yes. And a person would have a hard time cutting down a tree with a nail file. It’s the wrong tool. Online courses won’t replace every college course taught. Those requiring Socratic give and take are an obvious example. But many courses can be a blend of online and classroom.

An online lecture offers students in colleges too small to attract a faculty steeped in, say, Greek literature of the third century to hear one of the premier lecturers in subject matter speak as a “guest lecturer” via an online presentation, after which the class would discuss the material facilitated by the professor or instructor. An entire semester of guest lecturers could be cobbled together in a course that some colleges wouldn’t otherwise be able to offer.

The main obstacle preventing open online courses from being more of a threat to traditional classroom content delivery is the inability to get transferable college credits for courses taken online. Students would like to take and transfer inexpensive online courses, but college faculties are a hurdle. They assert their resistance is based on quality concerns, but exemption exams are a way around that objection. The real issue is turf and a concern that faculty positions would shrink if more courses went online. The rising cost of college and the crippling debt students or their families must underwrite never rise to the same level of concern among these faculties. Interestingly, their college-age children don’t worry about rising tuitions. If they choose, they may attend the college employing their parent tuition-free or at a substantial discount. That’s a nice bonus in after-tax dollars.

Well, all of the faculty resistance may be changing. Online courses are politically popular because they allow legislators to switch money from college subsidies to other state programs. Governor Rick Scott of Florida signed a bill this past July that originally would have expanded the implementation of MOOCs in the state’s primary, secondary, and college educational systems.

The primary and secondary teacher unions were able to reduce the scope of the original bill and the college faculty union was able to delay it – at least for a while.

The United Faculty of Florida were quoted as mounting an “intense and feverish” opposition to a generation of “cheap and dirty” online courses offered to students before they entered college. “No matter how many times they use ‘quality,’ this is a cheapening of what higher education is all about.” Luddite leaders probably said something similar.

But Florida college leaders have been given two years in the bill to come up with rules to grant credit for online courses, and K-12 students are required to use open online courses in four subject areas beginning the next academic year.

This past May, Georgia Tech announced it would get in front of the MOOC movement rather than fight it. Next year it will begin offering an online Master of Computer Science degree in partnership with AT&T, which ponied up $2 million for the project. Those who don’t want to earn the degree may take the MOOC Master of Computer Science courses free. For those who want a degree, the cost will be $6,600 compared with the $45,000 price tag for the on-campus model. AT&T will use the course to train employees and recruit candidates for its jobs.

Initially, enrollment will be a few hundred. But it’s expected to expand to over 10,000 annually, many of them students in other countries who can get a graduate degree but don’t need a visa to attend. Degree candidates will take proctored exams. Tutoring will be available as well as online office hours and other help.

An estimated three million STEM (science, technology, engineering, math) positions must be filled in the next half dozen years in this country. It’s hard enough to find STEM graduates because of the poor job public education does in preparing high school graduates for college in STEM curricula. Therefore, it’s stupid to throw cost obstacles in the way of students who are qualified to enroll in STEM degrees but can’t afford them. Georgia Tech has shown itself to be a leader in solving the cost barrier problem, while other college leaders and faculties are more concerned about college revenues and job security trotted out under the red herring of “quality.”

Last November Clay Shirky, an NYU professor, issued a warning to his colleagues in a blog entitled “Napster, Udacity, and the Academy.” He said it was fish or cut bait time for faculties to get onboard with online education. They had best take a lesson from Napster, which proved that music file sharing was a big market to Steve Jobs who developed iTunes to legitimize it. The music industry previously forced consumers to buy CD-based music they didn’t want in order to get the one or two tracks they did want. Along comes iTunes and cuts a pay-by-the-song deal with the record industry, which received two-thirds of 99¢ price of a song. A two-thirds cut is better than nothing, but the music industry could have owned the download business if they had only gotten out in front of the 10X trend driving file sharing instead of fighting it. The same thing will happen to traditional universities which fight online course offerings instead of adapting.

I’ll add my own two cents worth to Shirky’s warning.

A surprising number of innovations in business come from outside an industry. That’s because the industry is so wedded to its current business model that it considers everything that threatens it “the enemy” instead of “the future.” If the new business model cannibalizes the current one it’s bad. Or so the traditional thinking goes.

Example.

The music industry was wedded to vinyl records, which went through a succession of improvements from 78 rpm to 33 rpm and from high fidelity to stereo. You’d have expected the compact laser disc would have come from the vinyl record industry’s search to put more music on a smaller medium with better fidelity. It didn’t. The CD came out of the computer industry which stored data in digits. The record industry, preoccupied with vinyl, was replaced almost overnight.

Another example.

Nortel and Lucent were the leaders in the voice communications where parties spoke with each other through a telecommunication network that connected them via a sequence of switches. Once connected, the hook-up of phone lines and switches was “in use” until the call ended. Reliability was everything – telecom engineers spoke of “five nines” meaning 99.999% of the time, everything worked perfectly.

Data was a different matter. Users don’t connect to each other. They connect to a network through which data is broken up into packets and sent. These packets get mixed up with packets of other people’s data messages, but each packet has an address that allows the data message to be reassembled at its destination. Speed and the capacity to handle high volumes of data traffic are more important in data transmission than the reliability so important in voice transmission.

Data, however, was the red-headed stepchild of the telecommunications industry in its early years and voice was king. Then a little company, Cisco, came along. Their router wasn’t good enough for voice so they staked out territory on the data end of the market and continued to improve their product’s performance and quality.

Then the Internet became mainstream. The world of communications changed forever. No longer were users pushing data through private corporate networks within their building or to the building next door. They were pushing data to a computer on the opposite coast through the worldwide web, a network of servers connected through public telephone lines and switches. The telecommunications system – designed to handle an average voice call of three minutes – was paralyzed by long Internet data sessions.

Telephone networks began carrying more data than voice traffic. In time it was discovered that voice could be broken into packets like data. The quality was not as good as the traditional telephone voice call, but that would come with technical progress. Nortel and Lucent refused to play the data game. They chose to fight it. Cisco continued to improve to the point that voice-over-Internet Protocol (VoIP) became free phone service.

Then, in the 2000s, cell phones became mainstream and today half of the homes have no landline – the once rich domain of Nortel and Lucent. Lucent, a shell of its past glory, was acquired by a Canadian company. Nortel filed for bankruptcy and was disassembled for parts.

Oh, how the mighty have fallen.

In 1975 Theodore Levitt published an article in the Harvard Business Review entitled Marketing Myopia. It was profound for its time, and some of his ideas still are. The railroads, Levitt observed, were replaced by airlines because the former saw themselves in the “railroad” business rather than the transportation business.

Nothing prevented newspapers from creating eBay or Craigslist, which gutted their classified sales. But they saw themselves as being in the newspaper business. There is no reason that Wikipedia couldn’t have been created by Encyclopedia Britannica, which is no more, except the way Britannica defined itself.

Universities had best take note that history shows disruptive innovations almost always come from other industries. They blindside unsuspecting industries wedded to old business models and who have defined themselves too narrowly. And they usually win.

University faculties should be asking themselves what business they are in.