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Mike,
I don't think that what Mark Birbeck (and increasingly myself) has been calling xH - XQuery/XSLT/XHTML+XForms, etc - is going to seriously challenge ASP.NET or PHP for supremacy any time soon, but that's due at least as much to the fact that most server-side languages (Ruby not so much) are imperative rather than declarative, and as such are closer to the C++/Java/C# paradigm that many developers are used to.
Frankly, that's fine. However, one of the key aspects that continues to confound developers is the realistic workings of data binding. Microsoft's approach is to bind at the control level, and to work with a wide variety of data formats to do so. The xH model, on the other hand, assumes an extant and independent business data layer of which the component is only a reflection.
XML is increasingly becoming the lifeblood of most enterprises, and this is one area where I see the xH technologies gaining significantly over other approaches, especially when combined with a cogent schema mapping technology. XML databases play a big part in that.
It's a solution, one that may not necessarily be perfect for every occasion or developer, but invaluable for those developers who are already halfway into the XML space themselves.
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