It supports both local (client-side) operations, as well as remote (server-side) operations, based on how you set it up.
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It can consume data from any of the following sources: oData, WCF, RESTful Domain Data Sources, JSON, XML (with and without namespaces), local arrays, even pre-existing static HTML tables!
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It can be consumed by your own application script to handle your own data access scenarios in mashups and other solutions.
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The Data Source includes support for the WebAPI framework from Microsoft, which is included in Visual Studio 2012 and ASP.NET MVC 4. WebAPI helps you build applications that can reach a broad range of clients (desktop, mobile, and tablet) in a RESTful manner.