While it would not be technologically difficult to design most products to not require 'cloud' connectivity to provide full functionality, it would cut the companies out of data collection and they don't want that. How else will Google decide that saving the planet by manipulating everyones Nest to lie about the temperature its actually set at by a degree or two is too irresistable to pass up? One degree for an hour over 100 million people... just imagine the scale of CO2 emissions reduced, power consumption reduced, etc. Honestly surprised it hasn't happened yet.