How can an AI agent, that is usually running on some machine in the cloud, even run without actually pulling in the data into the cloud to work with it ?

Is there an idea some sort of fixed localy running code does filtering on the data before it is sent to cloud?

Still seems like it would not work very well if it actually did any safe filtering - as the model can't "think" without seeing the data and it won't see the data unless the data is loaded to cloud.