Despite the power and rich UI that desktop applications offer, it's obvious that the move to Web applications is accelerating. For many people, the ability to access their data through any browser clearly outweighs the benefits of desktop software.
However, if you get away from techie circles and speak with mainstream users, you'll find that many of them don't care about the ease of accessing their data. They only need to access their data from one location, so it makes no difference to them whether they can get their email at Starbucks. In fact, some of them don't even like the idea of their data being "out there somewhere."
Yet they're still moving to the Web.
Why is this? There are many reasons, but fear is a big one. Downloading and installing software is scary.
When you try to download something, you're presented with a security warning about how the software could potentially harm your computer. If you install the program despite this warning, your firewall often displays an intimidating dialog asking whether you really want to trust this application enough to let it talk to the outside world. It's a one-two punch that's driving away many would-be users of desktop software.
Sadly, I don't see any signs that this will dramatically change for the better, at least not in the Windows world. Despite the enormous graphical improvements and other advances in Windows Vista, downloading and installing software is still too scary for non-technical users.
It's great that Microsoft is concerned about security - given the past few years of spyware-ridden desktops, they have to make security their priority - but I sure wish they could make Windows secure without scaring away customers.