And this is why it tugs at me. So for 5 years I grew a company that built an 'internet appliance' for the Small/Medium business market. Even am named on the patent we filed for lights-out / noconsole operation. The goal was to make a server that was dead simple for the end user (they just plugged it into their ISDN or T-1 connection and turned it on). All of the 'hard stuff' was done under the covers and far away. When I left I joined NetApp and spent 5 years making their storage appliances more scalable. The notion of an appliance, in the face of all that programmability, is hard to hold on to but its possible.
Most of the people today who use "computers", "running a computer" doesn't make sense. They turn it on, it works, the load apps, they use them. That is their entire experience. Tablets and smartphones are even more along this route. Few users of 'smartphones' think of them as computers they could open up a shell on, code up some program, compile it and execute it.
So from my history I can imagine this "thing" perhaps it looks like a furnace or a water cooler, its in grey industrial steel, has fins on it, and where a breaker box would have circuit breakers it has a box that holds disk drives, 10, 20 or 30 of them. And the drive boxes have a light that is either red, yellow, or green. "Technicians" can come to your house and swap out all of the units with red lights (or red/yellow) lights periodically like you change the filters on your furnace.
From an application perspective you have a web based email client (gmail like but running on your own appliance), you've got flickr, facebook, twilo, icloud, all those services you have now where the machine is in someone's data center, that machine is in a closet in your house somewhere. These things have uptime measured in years. You buy "service apps" and push them to your "home server" and "poof" you have access to that. It has all your media, it can send it to any device in your house.
From a policy perspective this makes things very clear, this unit is running in your house and is your property. There is no legal theory that allows someone to demand its contents without a warrant. From a media perspective it ties you to your media, there is no ambiguity about licenses or rights. You bought a movie, you can watch that movie. It 'servitizes' things which today are shipped as hardware, smart TV's set top boxes, game consoles, phones, etc.
I feel like this sort of server is certainly possible with today's software, and with a gigabit to your house it will make more sense than having your 'stuff' out there where someone like the FBI can accidentally take it down because there are other services running in the same rack they want.
The only thing missing from this picture at the moment is that folks don't see a value (well most folks) and until these are wide spread, the value proposition is primarily consolidation of your media and better privacy guarantees. That combined with the fact that it is hard to make a really lean hardware start up and that leaves you with slow to no adoption. Weirdly, Oracle could do this with their Sun assets but not sure they would want to.