Sounds like the rebranding of existing technology. Back in the late 90's it was called Application services. Many ASP's provided solutions like e-mail and productivity tools (i.e. Office) via Citrix. Yours truly even worked at a start-up that provided bio-tech applications to customers this way. Many of these did not survive because bandwidth would not allow the robustness some of the applications required (T1 was pretty much the norm for most companies) - not to mention a lack of support for terminal environments.
I do think however, that the technology and connection speeds may help this out moving forward. You have Google with their office products, and with virtualization, you can have an entire infrastructure (desktop, storage, processor etc) served to you via a broadband connection.
The only downside is security.... as mentioned above, there are some companies that would never be able to adopt this. The risks and/or mitigating controls used by the providers would be so great, the costs savings to the customer would most likely be minimal.
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