Latency is mostly a solved problem though when it comes to high speed connections though. Early when cable was released in my area there was high burst rates but bad latency - so back then I went with a dsl connection that had lower band width but better latency. These days though the latency is low enough on the cable connection in my area that I can play FPS perfectly fine.

From the article it sounds like the were able to play an FPS like Crysis just fine. FPS seems to be the gold standard, if you can run an FPS you can play any other type of game because they don't have the same type of split second reaction times.

It definitely sounds like an interesting system to try. I can't see how they could possibly stream HD content fast enough to make an FPS playable - but maybe that only works on a fiber connection.