I see the desktop disappearing completely in the not too distant future in favor of full client integration of the net via technologies like Google Gears http://gears.google.com
However, my gripe with Google Gears - apart from the fact it does not support SAFARI yet - is that the integrated db is Sqlite.
This is plain wrong in my mind. It really should be and XMLDB. So I hope that the Yahoo YUI people are taking note because a client side persistent XMLDB that supports XSLT, XPath and XQuery (with Update extensions) is certainly the way to go.