Here's what it boils down to:
Microsoft and Google are both getting ahead of the game of online applications.
As cellphones become smart phones and we are looking to UMPCs, the market for software is not just limited to high speed desktop workhorses. Not to mention, how many devices now have internet access? Your phone, game console, laptop, PDA and computer?
We live in an age booming with connectivity. Every new technological device wants to communicate with something. So what's the answer? Release 25 different versions of MS Office? Office 2006 Toaster Edition? No, just make the device with a browser and let the web sort it out.
That's the mentality they are approaching with. Everything can run a browser reguardless of it's CPU, method of connectivity, or manufacturer. So what happens when you make an application like Office entirely web based? Well, now you can update those sales figures from the Staples Center while you watch a basketball game.
Not only that, but how can you pirate a software that you don't have? Web based software isn't loaded on a machine, so it can't be copied. This way if you want to use Office from 10 different computers, Microsoft knows it. Right now, you can buy a copy of Office and load it on 10 machines and Microsoft won't be the wiser.
This is just the beginning. You will start seeing more and more applications move to the web. Eventually you will be able to have a bare system that just fires up a browser and connects to the internet on boot. No hard drive, minimal RAM and a smaller CPU. Like the thin-clients of today, but on a much more practical and widespread level.
You will then see these 'Internet PCs' spring up for next to nothing. $100 or less as the price of LCDs drop.
But that's just my 2 cents on the matter. I could be completely wrong.
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