This requires a built in H.264/AVC encoder on the GPU, currently only the GTX 650 and higher have this feature. While it would be possible for AMD to add this to the Radeon, it is unlikely that Nvidia will support this as the Nvidia Experience software is required to run as the server for the thin client in the Shield. I am currently contemplating a remote service that would enable those without systems capable of running the games still use the remote play feature, there are some tests to be worked out once I get my hands on a unit, but I believe with a fast enough internet connection and a VPN, I would be able to host Nvidia shared VMs and someones Steam account on the VM to enable them to use the service remotely. Let me know if you would be interested in such a service.
They have stated it will only support Nvidia Kepler based desktop GPU's. I have it working on a kepler based mobile GPU with a registry hack. If the Radeon supports on the fly h.264 encoding it may be possible. Basically you are seeing a video stream in h.264 on the shield.