> in fact for many people their daily commute will get slower as autonomous cars will follow all the laws (no sneaky 10 KPH over in light traffic)
That's not what causes rush hour traffic. What causes rush hour traffic is 20 cars at a red light each waiting .5 to 1.5 seconds for the car in front to observably start rolling through the light before the next one starts. When the cars can do that in .05 seconds, a lot more will make it through the traffic light.
On the highway many jams are "phantom" traffic jams caused by idiots spiking brakes and not allowing for proper following distances. Both of which SDCs will eliminate.
You are making a whole raft of incorrect assumptions. 500ms for an automated car to react to a car in front of it braking? Seriously? The cars are already constantly observing through both cameras and radar/lidar all other vehicles around them and tracking their positions. I would be astonished if the car couldn't react in 10ms to a change in one of the other cars' velocities. Hell, my dad's Acura has automatic braking that does better than a human if needed. It observes the car in front through radar and if the meatbag behind the wheel doesn't respond within a sufficient threshold to brake, the car does it for them.
You say "processing needs to be on-board". It already is. And nobody is even talking about centralized network control of cars. That's going to be a long time off, if ever. Centralized car control would make a really juicy terrorist target if nothing else - "Hey let's have every 4th car cross the centerline and have a head-on at 12:14pm". There will NOT be a "server" for the foreseeable future, if ever. The most you're going to get is cars communicating with each other short range within a couple hundred meters and stating their intentions and possibly negotiating minor alterations to those intentions like 'This vehicle needs to use the turn off in 600m, request clearance for lane change' and the like.