Apple thinks they can get a best-of-both-worlds approach with Private Cloud Compute. They believe they can secure private servers specialized to specific client devices in a way that the cloud compute effort is still "client-side" from a trust standpoint, but still able to use extra server-side resources (under lock and key).

I don't know how close to that ideal they've achieved, but especially given this announcement is partly baked on an arrangement with Google that they are allowed to run Gemini on-device and in Private Cloud Compute, without using Google's more direct Gemini services/cloud, I'm excited that they are trying and I'm interested in how this plays out.