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How will this work?
For MS Office, though, I have to wonder about the client. I doubt that Microsoft wants to code Office clients in Java.
If they go with some wicked DHTML, scripting, or whatever, it will be a ton of ASCII to transfer. It also could make the source visible to the world. Finally, it still leaves developers with some real headaches maintaining application state.
This leaves ActiveX. Ok, I don't mind it too much for intranet use, but in the wild-and-wooly outside world, I worry about the security. The approve/download/invoke process is a little cumbersome and scary to new users ("This content may be harmful. It has a signed digital certificate. Are you sure?")
Finally, this is OFFICE, folks -- the ActiveX client controls are likely to be sizable. Think about all those whiz-bang user interface features in Word. Good luck downloading the components with your 28.8 modem. You might want to start that term paper early.
All in all, it will be interesting to see how they solve these issues.
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