The evidence is phenomenally consistent that the online self-paced stuff works great for professional people who've mastered college-level skills in reading, writing, and math... but falls on its face for people who don't have that. For example, every attempt at getting the horde of people who need algebra remediation through online course has been a disaster. UDacity tried it at San Jose state and was suspended after one semester. Community colleges in Philadelphia tried it and concluded "The failure rates were so high that it seemed almost unethical to offer the option". So I highly doubt you can replace elementary/secondary schools with this method; at that level, most student need a personal face and hand-holding through the material, especially with technical stuff like using, interpreting, and debugging online resources in the first place.
http://www.angrymath.com/2013/06/online-remedial-courses-considered.html
http://www.angrymath.com/2013/...
I think there is a bit of selection bias here. Each course has pre-requisite knowledge, and I suspect a large part of the reason people can struggle with a course (and therefore need a remedial course) is because they don't have a solid grasp of the assumed knowledge. This is especially true for subjects like math, where all the different subdisciplines are inter-connected (e.g. consider how often log and trig laws turn up in calculus).
This problem arises partly because students are not held back a year if they perform poorly in one or two subjects, but are then assumed to have the same knowledge as everyone else in the year. The primary advantage of an online system is that the content can be tailored to each student. e.g. you can force a student to re-do a unit of math until they are able to pass without impacting their ability to take higher level units in other subjects.
Of course, this doesn't in any way negate the need for one-on-one time with remedial students. But by automating the more repetitive parts of the knowledge transfer process, it frees up the educator to spend more one-on-one time with struggling students.
There are also issues with the increased need for students to have self-motivation and drive, but I suspect it would be beneficial to imbue them with those traits from a young age anyway.