The reason this is good for privacy is because we don't need a new smart device to send other (like video) data away for heavy processing in the cloud.
We might instead be able to just update wifi routers to create local functionality.
Then it will depend on the router and the user configuration what actually happens with that data.
The user can have full local control…. Except neighbours wifi could be spying and so could someone with a wifi device in a car. But if putting a faraday cage around peoples exterior walls (combined with an underground physical cable to an internal extender for phone and roaming while insid) becomes a thing then it looks it could be a great system theoretically.
Gotta wait to see how it might look in practice though.