In the old days, we had a system called NFS (Network File System) where, yes, you may decide to use only remote disks. There were several advantages apart from lowering the cost of disks, mainly that you could centrally manage boot images for a fleet of machines. Then we got the web and everyone seemed to assume you could do the same thing over the internet.

I agree with you, I would prefer a local disk to one with 100+ msec of latency and local storage prices are at the point where the right answer is probably "just add local storage."

But I watch with some sympathy the small army of sys-admins (something like 15-20 people) responsible for managing the 3000+ Macs our company uses and remember the 2 person staff which supported the 1500+ diskless workstations from my years at a sadly defunct mini-super-computer manufacturer. It was quite nice... you could go to any machine and log in and your desktop would follow you. I'm told doing the same thing with MSFT requires 10-20 people just to manage the AD hardware (though as a unix-fan, I hang out with other unix-fans who are notoriously rude to MSFT, so maybe it's only 5-10 people needed to manage the AD instance.)