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given that signaling is one of the biggest challenges in online ed, and these are two of the best brands in edu, i hope they're coming together with some kind of credentialing system for their online offering. getting more backing behind mitx could go a long way
We're gonna have a little East Coast vs. West Coast competition here, it looks like.

It's good the leading universities are splitting like this, it'll advance things even faster.

agreed, and this is something that is lacking from all online ed. unless you learn python and js and html and then build some amazing website, there's no way to tell how valuable you are. In fact, coding seems to be the only thing you can learn online with some sort of measure of success available (ie, you build a webapp).
I think this has the potential to revolutionize higher education given enough time. With two of the most prestigious institutions in the country offering knowledge for free, it will get harder for other universities to rationalize the exorbitant cost of their education.

Once full fledged video of lectures and ways to interact with others who have knowledge in the field comes into play, this will really become a heavy hitter.

A little lacking in detail...
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FAQs

What is edX? An organization established by MIT and Harvard that will develop an open-source technology platform to deliver online courses. EdX will support Harvard and MIT faculty in conducting research on teaching and learning on campus through tools that enrich classroom and laboratory experiences. At the same time, edX also will reach learners around the world through online course materials. The edX website will begin by hosting MITx and Harvardx content, with the goal of adding content from other universities interested in joining the platform. edX will also support the Harvard and MIT faculty in conducting research on teaching and learning.

Who will lead edX? EdX is a priority for the leadership of both Harvard and MIT, and it will be governed by a board made up of key leaders from both institutions, appointed by each university’s president. MIT Professor of Electrical Engineering and Computer Science Anant Agarwal will be the initial President of edX and will report to the board.

What technology will edX use? An open-source online learning platform that will feature teaching designed specifically for the web. Features will include: self-paced learning, online discussion groups, wiki-based collaborative learning, assessment of learning as a student progresses through a course, and online laboratories. The platform will also serve as a laboratory from which data will be gathered to better understand how students learn. Because it is open source, the platform will be continuously improved.

It seems universities administrators in East Coast is more open to the idea of online education.
This whole online education trend was started by Stanford 9 months ago. Then, the professors who started two of the first three online classes created 2 separate startups (coursera and udacity). MITx was 6 months late to the game.
This is very cool. The competition is heating up: Coursera, Udacity, edX. That can only be good for us consumers. Can't wait to see where this will lead us.