If distributed working was a no-brained with no downsides we would all be doing it. However I do believe the upsides are several factors greater than the down, so the cost benefit does win out - if the effort is put in.

I have got most out of distributed working within weeks of physical meetups for sprints, so my view is meetup every quarter for a weeks sprint (somewhere nice of course!)

The benefits of easier to control working environments, focus on deliverables, honesty, greater team choice and flexibility, easier professionalism, all make winning easier