The big question for Microsoft is how potent can Windows Vista remain as a desktop platform if the whole web becomes an alternative? The company has countered this threat by beefing up MSN, its web portal, moving into VoIP, increasing its migration toward services through Software Assurance licencing, and a variety of Web 2.0-like utterances.

Its two cash cows, however, remain Windows and Office. The company has too much invested in its thick client base to be able to move out onto the web with any ease. Questionmarks must remain over its dominance in the years ahead.

Google has scooped Microsoft too often for comfort recently. As WinFS was removed from the initial release of Vista, Google launched its Desktop Search web-based app, which had a lot of WinFS’s functionality. The contrast was too raw for comfort.

Google Talk moved quickly into a niche that’s likely to expand rapidly in the months ahead. With free Google WiFi offered in San Francisco and wide area WiMax due next year, Google will offer much of the Windows and Office functionality free online. Google’s RTG feature already contains 70% of MS Office’s functions.

The prospect must terrify Bill Gates and Steve Ballmer. Even Scoble seems uneasy, begging his bosses to give him a checkbook for Web 2.0 acquisitions. Signs of panic? … or does the Kraken wake?