Excellent - thanks!
Next thing is to confirm your suspicion that iCloud-only files updated by another device are re-downloaded by any other Macs to allow for Time Machine to create a snapshot with the new version of the file.
Hi all - I came across this thread as I am thinking of switching on "documents in iCloud" as one measure against the recent announcement by CrashPlan to close it's consumer service.
Is it now proven that an optimised file that is edited elsewhere is downloaded across all devices and therefore becomes available for Time Machine (or any other backup service)?
...incidentally, even if the answer to this is "yes", optimised files that are no longer local would wreak havoc on any cloud-based versioning backup service that has a short file retention policy (Backblaze 30 days, Carbonate 30 days...). The backedup version would be deleted 30 days after the file became "optimised" and removed from the local drive. For example, Backblaze and Carbonite would both consider the file deleted and their 30 days countdown clock starts before they remove the backup as well.
thanks,
James.