Engadgets says:

"So, should developers invest in local apps for Android or is the future Web apps delivered via the Chrome browser?

When the T-Mobile G1 was launched, Switched On discussed Google's growing rivalry with Apple. But now Google itself an even more formidable threat to the Android than Apple or even Microsoft. Growing out of the group that created the Chrome browser, Google's Chrome OS creates a relatively lightweight layer of hardware management code primarily for the purpose of running one native app, the Chrome browser. While Chrome OS can take advantage of local processing and resources, the OS foregoes local applications, citing a need to preserve speed, security and simplicity.

That argument resembles one Apple made in the early days of the iPhone with web apps before it committed to releasing an SDK and launched the App Store – a reversal that's created one the most vibrant mobile software ecosystems ever seen. And unlike iPhone apps, Android apps can operate in the background. Indeed, Android's multitasking, alerts, and upgrade notifications are among the most elegant in the industry; clearly the OS development team has put a lot of thought into how to deliver the benefits of local applications in the stringent smartphone environment."

Source:http://www.engadget.com/2009/11/24/switched-on-chromes-shine-could-blind-android/