Tara Hunt is following the Steve Gillmor gravy train by saying "x is dead" when they really mean "x ought to be dead". I'm sensitive to this because of G. E. Moore and his naturalistic fallacy. If you want to say ought just say so. It's easy. Come on - Windows ought to be dead - Windows' value proposition for is already dead for anyone who isn't snorting the Outlook or DirectX crack - but the body has yet to catch up. 
Anyway, Tara's point is that offline applications aren't all that bad after all.
I agree. One of the things I like about the OPML Editor (and Frontier) is that it's an offline application. What would be really amazing is if someone could make a really powerful, extensible desktop application. The technology that needs to be made much simpler are all the little pieces that everyone has been bitching about for years: synchronisation, offline browsing and so on.
The application would do things like keep your files in sync with all your different web services, provide a neat offline bridge to web services, and do synchronisation with calendar, events, mapping and so on.
I use Flickr and I use blip.tv. Both have offline apps to easily upload content. They are both doing the same thing - taking data from my hard drive and putting it on the web. I have an FTP client (the excellent Interarchy). I have ssh. I have a group of hacked-together shell scripts. Bundle all that crap together, make it look nice and make it all sync nicely with all my devices.
The bridge between online and offline is still far too much hard work. It needs to be like my iPod - I just drop my iPod in to the dock, all the podcasts that are on it that I've listened to gets pulled off and all the new stuff gets dropped on there without me having to do anything. Why can the same not be true for everything else I do on the computer?
I have iCal - but it doesn't update my calendars unless the application is open. This means that if I want to find out what's going on, I have to open iCal, sync all my calendars in there, then open iSync and sync my calendars with my Palm and/or iPod.
I use loads of web applications that use a mixture of SOAP, XML-RPC, REST and other XML-based pieces. Tie them all together and make them look pretty. And make them work when I'm in a tunnel. No amount of AJAX will fix the fact that radio waves don't penetrate railway tunnels.
Bandwidth is currently nicely built up in two places - the home and the workplace. It's easier to access in the former (the latter has firewalls and IT department bullshit to deal with). Bandwidth in the gap is going to be far, far more expensive for a long time. Mobile networks are still too expensive and too slow (it's only affordable for me because I use GPRS instead of 3G) - and wi-fi is £25 a month (the same as a standard cable or satellite subscription). I'm not confident that the geek masturbation fodder of high-speed wireless connectivity everywhere is anything but a fantasy for at least a decade.
There aren't easy answers. I'm hoping to hack little possible solutions in to what I'm doing with my forthcoming online services platform.
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