They may not right now, but the whole point of Microsoft's Copilot+ PC standard (even though it's somewhat anemic) is to run models locally. Apple Silicon with enough unified memory is capable. Not to mention modern iPhones and Pixels have fairly capable NPUs and routinely run local models. So, we may not be to the point where most normal people have the hardware to run local models, but it is rapidly approaching.
They have it, we just haven’t enabled them. The smart model with a chat box is the wrong abstraction for local. Ideally we would have it built into applications as a clear and easy to use opt-in feature. Like allowing a user to index a folder on their hard drive and then search it semantically via embeddings. You could do that on fairly low end hardware these days. Like 2GB of RAM with any processor made within the last 10 years.