The later-phase, heading-to-market end of application model innovation is screaming along.
Sun and Microsoft have announced their intent to get into cloud models that improve scalability and manageability. We don't know for sure how pleasant the programming will be, but it seems reasonable to assume it's at least as good as ASP.net 3.5 or J5EE. Microsoft seems to be aiming center-of-the-road with stuff like ASP.net, the MVC flavor, and "dynamic data" pieces, while Sun is putting a big chunk of its chips on the Java side, and another big piece on JRuby/whatever-is-next-that-they-can-get-to-run-in-Glassfish.
Amazon is offering persistent disks for EC2, acknowledging that the RDBMS-backed app is not immediately going to disappear in favor of a S3 or SimpleDB layer. 'Cause syncing RDB stores usefully on S3 is a hassle (see slides 10-14 here).
Or, you can also buy all the missing pieces of the Amazon stack from RightScale.
Then there's Passenger (mod_rails) for Apache, and a Glassfish gem, which both aim to improve Rails deployability and incrementally bump performance.
But all this got me thinking about an alternate universe, one of those hindsight 20/20 things, that's interesting to imagine:
For Sun and Microsoft, I believe the missed-opportunity-of-the-decade was not open sourcing the JVM and CLR respectively (and their core libraries and infrastructure), from around 2000.
In the late 90s, Java was a beautiful thing, and aside from a few anti-OO diehards, it was clear that if the perf issues and minor hassles could be overcome, virtualized apps in an elegant environment (Smalltalk, oh wait, did I say that out loud?) were the future.
By 2000, Java legitimized VMs for server apps. As for GUI apps, graphics, printing, language neutral JIT, all manner of easy native interop, module loading, and the other parts Sun didn't get to ... Microsoft had those problems licked even if CLR was still in beta.
If all this IP had gone open at that time, a few major projects -- maybe 2 or 3 -- would probably have come out of it, and these projects would be the de facto runtimes for everything we want to run today. These few projects would spawn native bindings for all manner of OSes according to the existing APIs, so it would be even easier to really write apps that run on all kinds of devices, or in a cloud facility, or in on local elastic virtual infrastructure.
Performance, security, deployability, management -- these problems wouldn't magically go away, but with a more modest universe of options, they become infinitely more tractable.
In hindsight it seems that keeping these technologies proprietary (Sun's moving along; you can see Microsoft's code now, but you can't change it and re-release your own variant) was about fear and ego and control, defensive maneuvering.
I find it hard to see how either of these players would have made a dime less money in the scenario here; actually they would probably have made more money and have even more mindshare than they do now.