I'm excited about this work. Traditionally it's been hard to bridge local files and cloud documents, meaning that cloud data tends to stay siloed in specific editing UIs. This seems like the right first step towards letting traditional file-based editors work with realtime-collaborative cloud data.
Ultimately, in the long term, I think the filesystem probably provides the wrong abstraction for this use case though. The API we really need is "make these changes", (w/ changes represented thoughtfully in a mergeable way) not "here's the new final state." For now, diffing filesystem states is a reasonable workaround.