There's a great discussion going on at a student nerds' post (not mine) http://www.studentnerds.com/blog/2008/12/give-google-docs-try.php
About cloud computing and Open source. Andrew H makes some great points, but I still am a proponent of Open source and the cloud.
I got my new netbook almost a month ago, and promptly uninstalled the MS Works skeleton application that it came packaged with. I installed Open Office.org's suite of applications, and uploaded a lot my previous files to Google docs. I have been nothing but happy. The applications are powerful, flexible and free.
This is the way computing should be. Facebook, twitter, google itself, all these tools are free, and are changing the way the world works. This is the future. I think that the business model certainly needs a little work ( I personally like the free+premium model as I indicated in the comments) but that will come.
I understand that standard software is embedded and it's hard for people to change. But they do, especially in the face of a vastly superior product that I believe open cloud computing is.
Sent from my Verizon Wireless BlackBerry