I think the question is even a bit more nuanced than that. Even if frontier models can maintain a big gap that gap has to actually _matter_. If a local model satisfies my everyday use cases adequately then I may not really care that a frontier model is 5, 10, 100x better at ultra high order reasoning tasks.

I think that reality is probably not all that far off for a huge swath of use cases.

This is exactly the mainframe vs PC dynamic.