Shortly after the birth of world wide web came the inevitable online revolution in logo design. Unlike something like, say cell phones, logos and other design work can be digitized which makes them a perfect online commodity.
Online logo design differs in many ways from the traditional logo design services offered by ad agencies, but probably the biggest difference is price. Online logo designers often sell their services globally, so it's simply not possible for them to visit clients and research the company and industry in the way ad agencies usually do. If you cut the research out of the process you also cut out most of the work - so online logo design firms don't need to charge as much.
Logo designers following the traditional approach will of course argue that "you get what you pay for" - that online logo design firms can never really rival traditional ad agencies when it comes to quality. Judging purely by the number of online logo design firms it would seem that many companies today are ok with that and happy to pay less for a logo where the designer provides only the talent while the client provides the direction.
