I think that there will be real advantages to using Konfabulator style widgets as alternative access points to web services (can maintain local state, etc.) - HTML and AJAX is great, but also supporting widgets seems like a low cost way to extend the value of web servics. I am working (when I can break away from my consulting business) on a knowledge-intensive healthy food/recipes web portal and adding a Konfabulator widget interface seems like a good idea but with one problem: no way to generate revenue from advertisements (at least not easily like adding Google Ads).
Anyway, Konfabulator will be great for Yahoo as a new way for users to access their information sources and web utilities. I must say that Yahoo has been generally impressive lately. I am considering switching to their calendar web portal for organizing business and personal events. When I was exclusively using Macs, iCalendar did the trick, but I am looking for something more cross platform.
I also looked at MSN Virtual Earth this morning: lots of fun inspecting my local hiking trails while in bed with a cup of coffee :-)
Several years ago I wrote a book on J2EE ("Sun One Services") in which I hyped-up the possibilities for developers to think in terms of developing web portals instead of fat client applications. With more use of AJAX, things like Konfabulator widgets, and with a lower latency (more important than more bandwidth to me) Internet, web portals are looking to be a less expensive approach to running information-intensive businesses and a great way to start a small company for relatively little money.