Disclaimer: I work for a storage vendor.
> FTA: The real fix must be based on new technology such as OSD, where the disk knows what is stored on it and only has to read and write the objects being managed, not the whole device
OSD doesn't change anything. The disk has failed. How has OSD helped?
> FTA: or something like declustered RAID
Just skimming that document it seems to claim: only reconstruct data, not white space, and use a parity scheme that limits damage. Enterprise arrays that have native filesystem virtualisation (WAFL for example) already do this. RAID 6 arrays do this.
Lets recap. Physical devices including SSDs will fail. You need to be able to recover from failure. The failure could be as bad as the entire physical device failing, or as bad as a single sector being unreadable. In the former case a RAID reconstruct will recover the data but you'll hit RAID recovery errors due to the raw amount of data that needs to be recovered. Enterprise arrays mitigate the risk of recovery errors by using RAID 6. They could even recover the data from a DR mirrored system as part of the recovery scheme.
And when RAID 6 has a high enough risk that it's worth expanding the scheme everyone will start switching from double parity schemes to triple parity schemes since their much less expensive in terms of spindle count than RAID 6+1.
One assumption is, at some point in the future, reconstructions will be a continual occurring background task just like any other background task that enterprise arrays handle. As long as there is enough resiliency and performance isn't impacted then it doesn't matter if a disk is being rebuilt.