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Do people not use the cloud?

I saw some video not long ago of the cloud being used and it made it so that multiple buildings and millions of collisions could be done and there was no fps drop. Then same PC without cloud activated did the same and it was like 5 fps.

Wasn't the XOne touting the cloud. When is this going to be seen in games? Seems strange that it suffers so much in terms of FPS.