Large scale "render farms" that exploit both already exist and are in commercial use in the VFX industry.
There are some tools that allow you to render a frame quickly by using many hosts to parallelise the task. This is usually only practical when the data that generates the frame is relatively small, in other words not gigabytes of fluid simulation voxels. It's also not realtime, by any stretch!
A renderfarm is usually not technologically any different to local rendering on a workstation. We generally don't parallelize across hosts within a single frame, but at least you can render lots of frames simultaneously!
Another thing that doesn't seem to have been mentioned on this post is that raytracing can be accelerated massively (where applicable) by using instancing. A single object can be used many times in a scene, only differing in its transformation. This allows the geometry to be stored in ram once and re-used, incoming rays that are incident on an instance's bounding box can simply be transformed into the local space of the instance. Of course this is of no help in an extremely complex scene full of unique objects, but in practice you can make great savings (and create very complex scenes that are cheap to raytrace) this way.
You're also forgetting about the flip-side. A classic benefit of scanline renderers was that a scene could be split into multiple parts, which (via a z-buffer) could then be combined without any further rendering. A raytracer, on the other hand, has to have access to the whole scene (if you consider reflections, which make culling objects essentially impossible) to calculate any given pixel sample.
I don't know whether this is still an issue, but for a while it was a barrier to raytracing scenes on a Pixar level.
Something like this would really help with things like raytracing. But then again, as Carmack mentions, the huge disadvantage are the acceleration structures which need to be discarded and rebuilt per frame for dynamic objects. It's like saying that raytracing is by it's nature inferior(or at least very wasteful) from performance point of view. It's like a problem to which you simply don't say "Just throw more hardware at it!".
I wrote a ray tracer once, but it was primitive. So I'm not completely talking out of my butt, just mostly.
Yeah but surely not for the geometry itself. In rasterization, we may use simple low-overhead acc. structures to efficiently traverse a relevant sub-set of the whole (but coarsely described) scene for some fancy culling, collision detection (OK that's not really rendering) ... but geometry (vertices, polygons, vertex attributes) does not need to be traversed like that and thus does not have to be stored as individual triangles in an octree or bounding-volume hierarchy or what not. Quite a difference in overheads here. In GPU terms, with rasterization you have geometry neatly stored in vertex buffers and an awesome Z-aware traversal method with vertex shaders. In a simplistic current-gen fragment-shader-based raytracer, each pixel traces a ray traversing through your acceleration structure which may be stored in a volume texture (ouch, so many texel fetches...) since vertex buffers are not sensibly accessible in a frag shader.
> scenes that are indistinguishable from reality
This would also require a high dynamic range output device. Looking directly into perfectly raytraced sunlight still won't glare and blind me like the real world does, but indeed, by 2050...
You could try to look directly into a beamer instead of onto the screen, if glare is all you want. ( And by 2050 I would suspect that the scene is directly copied into the frontal lobe, bypassing the visual cortex.)
But that's from my simple understanding, possibly there would be other problems too...
I am 90% sure that the eventual path to integration of ray tracing hardware into consumer devices will be as minor tweaks to the existing GPU microarchitectures.