That's basically what Chromebooks already are. I think it's the future too. The only problem is that it moves away from the "upgrade your device every X years" paradigm that makes consumer electronics manufacturers money. They'll have to switch to a subscription model and people may not like that (and personally I'm terrified of the alternative situation where a company would rather I give them my personal information than pay them $1000 every 4 years)

One way to approach the latency problem is with more aggressive colocation. For example, an apartment complex could have its own AWS or Google servers for local computation or video streaming.