There isn’t really anything more that a browser can do right? Well, I think we will be laughing as we look back at this question in the future. We have already seen the network define the desktop experience, but there is still a clear chasm between desktop applications and web based services. One of the chief issues seems to be the location of the files. You can tag photos in Flickr, but they have to be uploaded first. You can create a document in Google docs, but you have to save it to your machine as a separate instance when you want a copy to send to someone as an attachment. This is time taken away from the user to do a menial task. Why would I go through the trouble of uploading a file to edit in Google Docs when I can just double-click it and it opens in Microsoft Word? That is THE barrier to overcome.
This can very well change soon. Take a look at what Google is offering (although currently with the Google toolbar only):
Sorry for the massive screen capture size earlier!