"The system then uses a variety of machine-learning techniques to train itself to be able to grade any number of essays or answers automatically and almost instantaneously.
The software will assign a grade depending on the scoring system created by the teacher, whether it is a letter grade or numerical rank. It will also provide general feedback, like telling a student whether an answer was on topic or not."
It's true that I'm somewhat tempted by this; I'm looking at a very large stack of papers to grade this weekend. But this sounds like a bad idea for two reasons: The first is that offering feedback about whether a paper is "on topic or not" is not particularly helpful for a student who needs to learn critical thinking skills. Mastering a particular topic or some information is far less important than mastery of logic and rhetoric; additionally, the latter are ultimately transferable from one kind of task to another, unlike the former. The second reason is that I don't think the increased automation of education is a good idea. Or, put a different way, I don't think it's a good idea for learning anything other than basic content.
Not only is human-graded student work going out the window, but those entire pesky universities are, too. EdX is also teaming up with Pearson, the educational testing service, to offer proctored exams for certificate credit to MOOC enrollees. Yes, the for-profit education testing service is now going to be in the business of accrediting MOOCs for students who want to get academic credit. And the Minerva Project offers the promise of a "hybrid" model--MOOCs and a residential college experience. Pay for both experiences, but without getting as much as either has to offer by itself. The privatization of college education is here to stay.