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On using the kernel I guess I made an assumptions that I should have been clearer on.

My assumption, based on their limited press, is that Google won't be allowing/encouraging local applications (other than I'd assume Gears/HTML5 local storage apps). If Google allows for local apps then there's really no point to what they're doing.

So my theory is that it really will matter because programmers won't have access to the underlying OS.

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I'm not clear on this -- how can it be open source without allowing programmers access to the underlying OS?

Also, I would be surprised if the OS doesn't allow for running any local apps but you may be right.

Also, I guess some Linux folks (like myself) are upset because we wanted to see a full-on competitor to msft with Google branding, i.e. Goobuntu. There have been rumors for years about a Google-branded Linux distribution coming out and its a bit disappointing that its not the whole hog.

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