(NOTE: This is the original version of my Reddit post. Since I have made a major revision to the post in order to clarify issues that were left somewhat unclear in the original version, and to address some complaints about minor factual errors, I am preserving the original here just so that no one thinks that I'm trying to pull the wool over anyone's eyes. The updated version is available here. It can probably be left unsaid that this parenthetical comment was not in the original post, but I've learned the hard way that unless you spell everything out in explicit detail and accuracy, someone or another will post a complaint.)

TLDR: In Destiny 1, there are three types of servers: mission servers, zone servers, and physics servers. The first two run in Bungie's server cloud, but the physics server runs on a player's console. The physics server runs on a console in order to save mone