The biggest weakness for online schools is a lack of government funding, a select committee has been told.
The Education and Workforce Select Committee is considering a bill that would scrap legislation to formally recognise online schools and give them access to government funding on the same basis as regular schools.
However proponents of online learning told the committee the government was right to drop its predecessor's plan for Communities of Online Learning (COOLs), but it needs to develop a regulatory and funding framework to replace the scheme.
Michael Barbour from Touro University in California told the select committee the lack of guaranteed government support put schools' efforts in danger.
"While no plan is better than the plan that had been put in place under the original amendment, I don't think no plan is a good route forward in the long term. This sector needs some sort of framework in which to operate under, otherwise it will just eventually cease to exist, which would be a real shame," Dr Barbour said.
He said the biggest strength of online learning in New Zealand was the way schools cooperate, and the lack of government resources for those efforts was its biggest weakness.
Dr Barbour studied online learning in New Zealand and was on the governance board of the Virtual Learning Network Primary School, which helped more than 55 schools provide online learning to 1200 children.
The VLN primary school's e-principal Rachel Whalley said the network had a contract with the Education Ministry that provided $100,000 a year.
But she said it was not enough.
"It's calculated on 450 learners from back in 2013 and as you heard today we are now 1200 learners," she said.
Ms Whalley said the network was still waiting to hear if the contract would be renewed for next year, and it needed greater certainty about its funding.
"A lot of our schools are very small schools and they've got a limited amount of funding that they can contribute to operationalise online learning across their schools. They all contribute to a teaching fund but these things need professional support and leadership and that's where we need the ministry to step up," she said.
"We need to have some sort of strategic regulatory framework for online learning within mainstream public education. It's been happening for more than two decades, under the radar in many cases, but it provides lots of opportunities for our learners."
Ms Whalley said nearly half the network's enrolments were children learning te reo Māori.
She said the network's model was not about putting children in front of videos or online programmes, but about teachers actively teaching children over the internet.
"Online learning, in the way that it's currently happening in our VLN clusters, is about groups of students and teachers getting together in virtual environments and learning together," she said.
The Ministry of Education said it was in the process of re-procuring services from the Virtual Learning Network for 2019.