Can it happen online? Probably. But proximity vastly decreases friction and increases the chances of success. Even between offices with enterprise-grade fibre and high-end videoconferencing-integrated conference rooms, telepresence isn't that good yet. There's no substitute for unscheduled hallway conversations and impromptu whiteboarding. These things might be unnecessary distractions if your job is to churn out code that fulfills well-defined specifications, but if you're doing something new and innovative and not fully understood yet, or something complex enough to require deep interactions with your coworkers (beyond task assignment and status updates), they are a major boon.