It's like how nerdy types could easily slap together their own Dropbox, with rsync and duct tape (as per the famous comment), but most didn't - plus the world is not just full of types who'd do it. And then MS can start adding all kinds of collaboration tools built in, from pair coding to bug tracking, time tracking and so on.
I can imagine an enterprise giving devs just this + something like local/Cloud VPS/CI/CD environment to work in. Immediately reproducible, no hassle, secure, and so on.
>The browser version will always be a compromised experience, given the inherent limitation
Well, offline VSCode is a glorified browser as well.