How cool would that be, your files are in iCloud so you know they are safeMy open-source stuff is on Github, sure, but none of my private code is. I run a Redmine+gitolite instance on a physical box in my house for my private and private collaborative projects (one on-site backup, taken daily and rolled over three days; one off-site backup, stored every week). My code stays local and on machines I control, and the same is the case for many other businesses. It's for that reason that I don't think what you're describing is likely to be so commonplace as to make local development "fall by the wayside" in the near future.
While I get where you're going, I admit I had to restrain an eye-roll at the idea that this will be "the thing" anytime soon if only due to inertia. A development environment for Android in the cloud would be "cool," until it breaks. I have a very overpowering need to control my toolchain and my environment and that doesn't mesh with what you describe. I find the situation you are describing to feel really fucking oppressive. Unsettlingly so.
(I don't see Apple locking down the Mac, by the way. I see Mac sales being cannibalized by iPads, but I do not see Apple, at least in the near future, killing its most attractive feature--flexibility. Both for developers and for consumers. I think Microsoft has a much better chance of offing the traditional desktop/laptop with WinRT, though I'm personally not a fan.)
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I fully agree that something similar will eventually happen for a certain subset of development; there are certainly some developers to whom this no doubt sounds really awesome. But I think that, and I don't say this to be either insulting or patronizing, this may be a bit of projection on your part. This feels like a "Valley bubble" idea, a "wouldn't it be cool if" that ignores a lot of real-world use-cases. Even aside from the "ew, remote" factor for me personally, I think there are enough infrastructural hurdles to make this really difficult to do in the sort of timeframe you're suggesting.
But I am not the target market for such things anyway. I find "always-on" technology overwhelming. I find that my best development time is when I turn off the Internet and go sit outside and write code; I keep local copies of the Python manual, the Java APIs, and the MSDN library for that reason. (And my Mac is silent when I'm doing development work, FWIW.)
Perhaps I am wishcasting, but I don't think so. Here's hoping you're wrong. =)