I have run some tests. As I understand reading what Jack_Nichols has written in the post explaining everything, the Files on-demand experience used now in OneDrive uses Appleās File Provider platform, a new api offered by the OS that is replacing an older kernel extension that OneDrive was previously using. Isn't this the same api used by iCloud Drive to maintain the syncing of its contents on macOS with the cloud? Then why does iCloud Drive offer a seamless experience and isn't affecting the indexing of the Spotlight search service on macOS for files stored on it from other devices?
This just looks to me like a very poor implementation by Microsoft of the solution.
Just run a short test if you want to try this:
- Create any text document on iPhone and save it to iCloud Drive (a Word document works fine).
- After this go to the Mac and use Spotlight to search for a word inside that document. As you can see Spotlight shows you the created document on the results. It is not only indexing the document by filename without any problems but also its contents.
Try to do the same with OneDrive and the process fails miserably.