First: Almost everything is going to go web based, it is conceivable that eventually even operating systems could go web based. This would require mobile computers to have very little processing power.
Second: Even Microsoft has admitted they are losing ground to Google. The recent attempt to acquire Yahoo shows that Microsoft is deeply concerned about Google.
I believe you're thinking too far ahead. 30% of this country doesn't even have the internet. Even more are withou high speed, always-on, broadband access, yet you expect them to be on internet based apps within even just 10 yrs? Not to mention, the internet - in it's current state - does not have the capacity to handle such a large scale increase in traffic. A forklift overhaul is in order.
when google begins development of large scale business and even just home productivity software and operating systems, then I think Microsoft should worry. Until then, they develop digital marketing technology and largely "gadget" software.
This whole ideology of, "if Google wins, then Microsoft loses" doesn't hold water. I have no doubt Google's
prospects worry Microsoft, as they would any publicly traded company, but they're not the threat (at least, no where near immediate) that everyone makes them out to be.
And if you think that businesses will expose each of their workstations on a global public network through the use of internet enabled applications - maintained by a single company that intentionally sells user info to 3rd parties - I'd say you were crazy and far too ignorant of security issues that would arise. If you think Microsoft is bad - wait until Google truly "owns the internet".
And don't think for one minute that Google is safe from competitors, either. It's a lot easier to switch search engines than it is operating systems and productivity/corporate software. And Google is already finding themselves in a heap of legal troubles and public backlash for some of their activities. That'll increase in time.