I saw that Kenan-Flagler School of Business at the University of North Carolina Chapel Hill is starting its new online MBA course this week.

From what I know, this is the first of the really top tier schools to introduce a distance learning program. It could bode well for more competition in this space.

However, at $89,000 (the same price as their class based program,) this could start pushing prices up. Now schools like Columbia or Haas could be justified in charging as much or more for similar offerings.

The question is, would they be worth it? I think in the long run, the overhead for conducting these courses compared to being in classes could be substantially cheaper (relying on video taped lectures, developed online infrastructure, etc.) I'd think that online students should get a break, but I guess that's not going to happen.

This looks like a great MBA, with a weekly synchronous study-group method very similar to the Cornell-Queens MBA. If they can overcome the limitations of distance learning by adding in group work and residential sessions (as they seem to be doing) then that can erode the EMBA market.

Indeed.

Today's Wall Street Journal has some good coverage of the program - although the writer calls it "risky." Glowing quotes from a Capella rep, obviously - but others talk about the "less than glowing" reputation of online courses in general (although schools like UNC jumping into the game could change this perception.)

The writer does bring up an interesting point - that for an employer who wants to sponsor his employees to take an MBA course, an online version of a top tier program (say at UNC) would be beneficial because the students don't have to move all the way to North Carolina from wherever they are from.

Of course Indiana, Thunderbird and a host of excellent European schools also do distance learning. I think the MBA@UNC is really competing with executive MBA, not full time programmes.

Don't know about that - I think that the UNC program represents a new top tier in full time distance MBA programs - because although Thunderbird, ASU etc. are great - they don't carry the name brand that UNC does.