Hi all
Actually I think if you look more deeply into this issue I think it looks like Google will want to get more involved with "Cloud Computing".
With high speed always on Internet connections all you theoretically need on a computer as an OS is just basically an Internet Browser which can connect to the appropriate server and run your applications, drivers for screens, local printers and some local storage. The OS would be far simply than Windows 7 assuming all the add ins to the browser were available so there's no reason why Google (or Fred and his dog under the railway arches) couldn't do it.
My MOBO actually has a small browser built in to its BIOS -- you can download updates and patch the BIOS without even booting the the OS (Windows / Linux).
The modern business model is going to be about pay by access unfortunately -- it's beginning already to trickle through as daily newspapers are charging more and more for some or "premium" content access. The same is true with a lot of libraries and decent scientific databases which used to be free.
Some local computing will always be required for specialized processing but for a HUGE majority of users the Cloud could actually work provided "Corporate Greed" doesn't price the model off the face of the planet -- no more worry about apps to install, correct versions etc etc.
Security could be a problem here but I'm sure that will be solved as well. Incidentally one of the "benefits" (??) of the Cloud is that it would be very easy to stop Torrent downloads etc since unless your browser had the P2P application built in you couldn't get access to the files.
Once I see the music industry pushing "Cloud Computing" I'll know what they are after -- but thats another topic.
Cheers
jimbo