I feel like a broken record here: it is not an engineering problem. Local-first and decentralized apps haven't become popular because SaaS has a vastly superior economic model, and more money means more to be invested in both polish (UI/UX) and marketing. All the technical challenges of decentralized or local-first apps are solvable. They are no harder than the technical challenges of doing cloud at scale. If there w…
I don't know. I think it's a lucky coincidence, but I genuinely think that cloud based solutions are better. Local first tends to suck in practice. For example, Office 365 with documents in the cloud is so much better for collaborating than dealing with "conflicted copy" in Dropbox. It sucks that you need an internet connection, but I think that drawback is worth it for never having to manually merge a sync conflict.
That has nothing to do with where the code lives and runs. There are unique technical challenges to doing it all at the edge, but there are already known solutions to these. If there was money in it, you'd have a lot of local first and decentralized apps. As I said, these technical challenges are not harder than, say, scaling a cloud app to millions of concurrent users. In some cases they're the same. Behind the scenes in the cloud you have all kinds of data sync and consistency enforcement systems that algorithmically resemble what you need for consistent fluid interaction peer to peer.