Online programs may not be accredited by national credentialing bodies. Many STEM degrees require lab courses that can't be performed online. And non-STEM programs are based around the seminar (classroom discussion) model, where on-site attendance is always superior to a Zoom meeting.

Forcing students to live on-premises also makes universities money through student housing and amenities. Universities have concerns that opening their programs to online instruction would lead to an exodus from the campus. You could have 70% of a 20,000 strong student body attend online, and all the expensive real estate of the campus would mostly be a waste of money.