If you look at the vast majority of MOOCs, they frankly kind of suck. Usually they're just a collection of poorly edited videos with maybe a forum where students can comment. They're on a fixed timeline where assignments need to be done linearly at set intervals, just the same as you would get if you were taking the course in person.

Compare that to something more dynamic like Khan Academy, where the subjects all build on each other like a directed graph. Students learn at their own pace, and gamification techniques get them to come back for more. Subject mastery isn't based on tests, but is constantly checked using heuristics which can determine whether a student needs help in a particular area. Oh, and grades get thrown out the window since everyone achieves complete mastery in the subject.

If you think of replacing teachers with a traditional Udacity style MOOC, yeah, I can't really see it happening. The only benefit they offer is that you don't have to be at the course in person. Could something like Khan Academy replace teachers? Clearly not entirely, however there are so many more benefits to learning this way, that it certainly is in the realm of possibility.