Udacity's Sebastian Thrun, Godfather Of Free Online Education, Changes Course

There's a story going around college campuses--whispered about over coffee in faculty lounges, held up with great fanfare in business-school sections, and debated nervously by chain-smoking teaching assistants.

It begins with a celebrated Stanford University academic who decides that he isn't doing enough to educate his students. The Professor is a star, regularly packing 200 students into lecture halls, and yet he begins to feel empty. What are 200 students in an age when billions of people around the world are connected to the Internet?

So one day in 2011, he sits down in his living room with an inexpensive digital camera and starts teaching, using a stack of napkins instead of a chalkboard. "Welcome to the first unit of Online Introduction to Artificial Intelligence," he begins, his face poorly lit and slightly out of focus. "I'll be teaching you the very basics today." Over the next three months, the Professor offers the same lectures, homework assignments, and exams to the masses as he does to the Stanford students who are paying $52,000 a year for the privilege. A computer handles the grading, and students are steered to web discussion forums if they need extra help.

Some 160,000 people sign up: young men dodging mortar attacks in Afghanistan, single mothers struggling to support their children in the United States, students in more than 190 countries. The youngest kid in the class is 10; the oldest is 70. Most struggle with the material, but a good number thrive. When the Professor ranks the scores from the final exam, he sees something shocking: None of the top 400 students goes to Stanford. They all took the class on the Internet. The experiment starts to look like something more.