Mike Chambers has an interesting posting with links to articles and discussions going on about the Flash Communication Server and bandwidth discussion. Mike has some good points and does a good job balancing the whole discussion.
The problem is that this is something that the end product (connected flash movies) is something that can be done with XML today (and thus is not as sexy). However, it is much, much easier using the Flash Communication Server (no need to parse XML, send and receive ActionScript data types, etc…), as well as much more efficient. In fact, for large multiuser projects, you will probably save on bandwidth costs using the Flash Communication Server verses using XML (mostly because XML is so verbose).
Which is a good point. Not having to parse XML on the client side will make any data displaying application run a whole lot faster, and it will require transmitting less data than you have to with XML.