This will be awesome
We all have our opinion about this, but I will share mine.
To the naysayers, I offer you this. Apple is targeting the majority, not any given minority. There will always be someone who wants full control, or secrecy, and that is fine. A MacBook Air with a TimeCapsue and a few terrabyte drives should cover your bases.
As for internet speeds, let be honest about file need. Most people work with small files. In addition they work with only a few small files. Not all, but most. Multiple succesful models for PaaS and SaaS exist. Look at Salesforce.com and Amazon's scalability. Google Documents is another one. For many, a reliable program that works and is fst enough is all they need.
Of course massive BluRay rips, DV footage etc. is not meant for broadband consumption. Sort of. We can stream HiDef and massive files, but it has limitation.
If you own an Air, or possibly future iOS devices, I am sure there will be ways to access external storage without the cloud.
So, here is one possible view of why this is a GOOD thing.
Imagine a world where all of your devices act as one extension of your workflow. My phone, tablet, home, and work PC, mobile or desktop allow me to access the same files, applications, and there is no synching or sending files, they are just instantly updated. In a business setting, you have share groups, and colloborative files. At home, photos and music and video can be shared among friends and devices. All of this driven with encrypted files and a combination of 4G cellular and WiFi. That or something close is the future.
Many major Fortune 500 firms already use cloud storage for their employees, both internaly and externally. Many Fortune 500 firms and universities already use off site facilities for data storage. There is no reason to fear your home data is any less secure than your bank statement with Citibank. That said, there is no foolproof security, but all the tinfoil hats in the world cannot protect you from every possibility.
Steve typically think in leaps and bounds. He plays the long game. Yes the Air is a nice machine and will work great for many but not all. Just as the iPad, various iPods and nearly any other consumer device in history. However, he is urging us towards a unified infrastructure where our lives are easier. I welcome the day when my home folder and files are always available and backed up and encrypted.
What are the limits of this technology. Broadband and access. Most of America is woefully behind the times for broadband. It is a fact and a sad fact. How do you combat this? Well, some level of local storage, and the fact the majority of people use small files. Even at dial up speeds, a typical word or excel opens in a few seconds. Cached on ever increasing sized SSD drives will alleviate much of the problem for many. The few that NEED large files at all times will have options open to them for local storage. It is not like they can take away your existing drives.
If I am out and about, we all know there is horrible high speed cellular ability, and when it does exist it is capped, limited and $$$$. Much like cable when it first started in the 1980's, the need and demand will reach a critical mass and the service will follow. Of course it will suck for some and be great for others. I myself have a FAST FIOS line and love it. Remember, Steve is playing the long game. 5 years from now and beyond. If you recall, 5 years ago we lacked much of the iOS lifestyle we have now.
When the first iPod was released, most people wondered why on Earth you needed a 5 gig device for songs. A decade later, we have iPhones, nanos and the like.The cloud will be ubiquitous and it won't just be Apple. We as consumers will have to adapt and business models will change, and change is hard. But we will and wonder how we lived without it all those years.
Yes, there will be hold outs, some for valid reasons and there will always be options for them. Maybe not an Apple option, but an option. They still sell mobile CD players. Why? Who knows, for those that refuse to go MP3 perhaps. There will always be local storage devices but as the world and society go to the cloud, you will find yourselves left behind.
Everyone thought Steve was insane for ditching the floppy. When did anyone last use one? Good riddance. Next, optical media. It is a dinosaur. Sure its common, but all digital is better. I love being able to download my apps and not wait for the UPS truck.
Your opinions may differ, but Apple has a solid long term plan here and will make the iOS/OS X platform very competetive in thie future marketspace.