The journal Nature posted a special section on the current issues facing the doctorate in today's marketplace.
The technologies that have transformed financial markets and the publishing, news and entertainment industries are now disrupting the education system. In the coming years, growing global competition for the multibillion-dollar education market will increase the pressure on US universities, just when public and private funding is decreasing.
This seems reminiscent of the recent debate about higher education on TechCrunch prompted by Peter Thiel's drop-out-of-college entrepreneurship program. Thiel argues that higher education is in a large bubble, mostly because we value undergraduate and graduate degrees more than they are intrinsically worth. Thus, dropping out and starting a company might be a better approach to teach useful skills and prepare students for the workforce.
My personal take on the whole debate is that higher education is about to be disrupted, but it is not a bubble. The value of further education is not overestimated, either in terms of pure economics like income over the life course or more generally as a means to provide contentment in one's life. High school graduates don't seem to have much pull in the marketplace, regardless of their actual skill set. I will leave the debate about whether that should be the case for another time.
However, the means by which we will acquire education are going to change dramatically, and quicker than most in higher education realize. Programs like the Khan Academy or iTunes U (and other web-based learning approaches that are getting started) can provide most of the learning available in the classroom at a university, in convenient bite sized chunks with plenty of additional material for assistance. Are university lectures with 400 students really better than these alternatives? The answer is flatly no.
What then will universities be for? Well, everything else that a college education (colored by my experience at Stanford of course) provides: access to faculty for research and seminars as well as a peer group of students who have their own educational value. Education is fundamentally a social process, a transfer of knowledge and experience from one individual to another. You can't get that level of social on the web just yet (and no, discussion forums are not as useful as a live conversation). I have always learned more from seminars and independent research projects than I have learned in lecture classes (and for the most part, I can the latter information from books). That is why doctorates will continue to grow in popularity, even if there is increasing concern about the issue of undergraduate degrees.
Universities need to adapt to the changing market. They might become a bubble if they fail to do so, but until then, let's worry about the Chinese housing bubble before the value of a college diploma or doctorate.