We do this as part of our university practical course as well (2 week challenges in teams of 4, sometimes participating also in external competitions). While I agree that this good for learning, I would, however, say it is completary to lectures. It makes no sense if people just learn to overfit some hyperparams to beat a score. So rating should at least be done wisely. Otherwise I think people need lectures to understand the real limits of tech and actually find novel uses.

With many good lecture contents online I think it also would be good to also switch to more live competitions at university to do inverted classroom style learning. I think it is the mix that matters (along with the quality)