It was only a matter of time before someone responded to Google's ChromeOS. Webian is that response, and looks and acts much like you'd expect a browser-based OS to act.
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Functioning as a Mozilla Labs project, Webian is fully open source, but in the very early stages of development. Still, some of the design ideas at play here are very nice. The tab bar along the bottom is an especially slick looking element to give Webian more of a desktop feel. You can download the early build now at [Webian via Digitizor]