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the web browser has now come full circle to being a very weird virtualized operating system, whose APIs rival Windows in size, idiosyncrasies and complexity

Er, I don't think so (on any of those three counts).

Along with ChromeOS, NaCl, Chromebooks and a web app store, Google's plans to kill the conventional Operating System is coming along nicely.
I don't like to use buzzwords, but this looks to be disruptive.

Let's take a trip back to 1996 in the Wayback Machine:

"Later this summer, Netscape will roll out a comprehensive Internet strategy that will position its servers and browser as a next-generation Internet-based operating system.

...The only difference technically between Netscape's Navigator browser and a traditional operating system is that Navigator will not include device drivers, [Marc] Andreessen said."

http://web.archive.org/web/19990428173124/http://www8.zdnet....