> Why can't they work on the local network? That would take no resources from Google

I'm guessing since the generations being shut down are explicit, I'm assuming there are more generations that aren't being shut down, so the simple answer is that they want to sell more of those devices, basically force people to upgrade.

So indirectly, letting people still use the devices locally, would mean they'll sell less of the newer devices, which probably have better margins, slurp up more data and will eventually be shut down too.