The best "agile" experience I've had was with a team spread across the continent. Good communication & process != co-located. (And if your customer is external, it even puts them on a more equal footing)

Ok it might be "good" but its not the best "communication & process " you get with collocated teams.

The skunkworks teams the developed the Apple MAC is one very good example.

Try to sell that to corporations with distributed teams, on the RFP answer.

The majority will rather pick other vendor that doesn't propose such change into their internal processes.

Unless they are asking for consultation on how to change work processes, that is.

That would not be Agile then - Agile trades off almost every thing for speed.

Hence why it is in its current adoption state.