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Xcerion has continued to work toward the general release of its XML-based "Cloud OS," a service based on Xcerion XML Internet Operating System/3 (XIOS/3). The announcement of an official name for the service brings the company a step close to that goal; it also certainly reassures investors like Lou Perazzoli, one of the core architects of Microsoft (NSDQ: MSFT) Windows NT, and Terry Drayton, founder of HomeGrocer.com, that Xcerion's technology is almost ready for prime time.

Icloud relies on an XML virtual machine for local (and offline) operation. It thus combines the advantages of remote computing -- a central point for software distribution, storage, and updates -- with the advantages of local computing -- execution speed and user control without a bandwidth bottleneck.

Icloud offers an intriguing technology that Xcerion is calling "gesture-based computing." Jonas Thornholm, CFO of Xcerion, believes it may be the service's "killer app." Gesture-based computing is essentially real-time content sharing. It allows users to drag and drop documents from their computer to a friend's computer in real time, as if they two machines were dual monitors powered by a single machine.

Meanwhile a Mountain View, Calif.-based startup called CherryPal just released a new mini-PC, known as the CherryPal, that is designed to operate solely via a Firefox browser. While the new machine, which will run on just 2 watts of power, has an embedded Linux-based OS, it's hidden from the user and is used mainly to boot up the browser to access common applications.

Several startups and open-source projects have built cloud-based operating systems, also known as WebTops, such as DesktopTwo, EyeOS, G.ho.st, and YouOS. To date these have mostly been of interest to the open-source development community, but the advent of browser-based "thin clients" like CherryPal and of projects like Midori indicates that fully cloud-based computing could make its way to the masses. Google is also said to be at work on a cloud OS, while a Swedish startup called Xcerion has gained attention for its hybrid, an XML-based system called iCloud.