WEB APPZ Vs. DESKTOP APPZ

"ThinkFree Online is, simply put, Office without the Microsoft, a collection of free online apps that support and contain most features found in Word, PowerPoint, and Excel. ThinkFree has just released a major upgrade to its features, bumping its online storage to 1GB for each user and adding a lightweight AJAX-based collaboration feature. ExtremeTech has an interesting review of ThinkFree Online's applications and features which reveals a lot to like about this improved webware and, while it may have its occasional quirks, can be great for those who want to edit and create documents on the fly." [via /.]

...To what extent and under which circumstances are web applications going to replace desktop applications?