I don't get what's unique about this. splashup.com and picnik have similar services.
If you go to http://pixlr.com/app, you immediately get a Photoshop interface.
If you go to http://www.picnik.com/app, you get to wait for a minute while the app 'fluffs clouds' and then you get a screen full of buttons and text ... when do I get to edit my photo again?
I had never heard of splashup.com. Their app execution seems good compared to picnik, comparable to pixlr. Perhaps marketing failed?