Google's entire ecosystem is distributed. Failovers are built on the true cloud - redundancy and availability. Connectivity is an issue, but it can possibly originate anywhere. What will always stay an issue is input lag, the processing isn't done on the client-side since there isn't any, and I guess that the developers will work on input error-correction which will be an AI guestimate system. The problem is congestion, obviously, this will improve as hardware and connectivity options improve, but the more players in an instance the worse the input lag will be.
Then input... as long as you can upload there will be hacks. There is no way around it. Albeit these hacks are services which is expensive.