Google has launched appengine which provides developers with a platform SDK (python based!) and hosting with access to own Google BigTable database! This competes with Amazon.com's SQS , S3 (storage) and EC2 (hosting) services which are used by many startups... The applications will get google's massively scalable infrastructure, failover. Apps would also be able to easily use google's user authentication, analytics and other google API's.
The applications gallery points to some cool goodies... The applications would get a subdomain under appspot.com. So it is possible to run a search on google to find the existing applications.
Here is a python shell web app. You can see the loaded modules, enter and run some small programs...
Both companies are trying to entice developers from hot startups into using their infrastructure, so just in case they start getting bigger, it is easier to assimilate them! Let there be competition!