In a NY Times article, the victory of the walled garden is predicted:

But a kind of virtual redlining is now under way. The Webtropolis is being stratified. Even if, like most people, you still surf the Web on a desktop or laptop, you will have noticed pay walls, invitation-only clubs, subscription programs, privacy settings and other ways of creating tiers of access. All these things make spaces feel “safe” — not only from viruses,  instability, unwanted light and sound, unrequested porn, sponsored links and pop-up ads, but also from crude design, wayward and unregistered commenters and the eccentric ­voices and images that make the Web constantly surprising, challenging and enlightening.

...

The far more significant development, however, is that many people are on their way to quitting the open Web entirely. That’s what the 50 million or so users of the iPhone and iPad are in position to do. By choosing machines that come to life only when tricked out with apps from the App Store, users of Apple’s radical mobile devices increasingly commit themselves to a more remote and inevitably antagonistic relationship with the Web. Apple rigorously vets every app and takes 30 percent of all sales; the free content and energy of the Web does not meet the refined standards set by the App Store. For example, the Weather Channel Max app, which turns the weather into a thrilling interactive movie, offers a superior experience of meteorology to that of Weather.com, which looks like a boring cluttered textbook: white space, columns of fussy bullet points and thumbnail images.

In a word, poppycock. This only holds true because people are revisiting the download and run locally phenomenon -- just like in the BBS days. And it may remain as the best user experience until the web standards catch up. The exception being native hardware performance tricks, like the accelerometers in the iPod/iPhone/iPad, but the "good enough" standard of web apps will eventually surpass this shortfall.

Basically, open always wins out over closed.