Adobe is trying to remain a force both on the desktop (thanks to the ubiquity of the PDF standard) and in the browser (thanks to Flash), and is hoping AIR can be the tie that binds.
But it's difficult being all things to all people. As Shankland notes,
there's a risk to choosing a hybrid strategy: gains in flexibility often come at the expense of specialization, and specialized applications often work better. Sun Microsystems tried for years to get Java to catch on as a cross-platform runtime, but 13 years after its launch, it has yet to catch on with mainstream computing applications.
Of course, Adobe isn't the only company offering ways to pair the cloud and the desktop; Google Gears and Microsoft Silverlight are two notable competitors.
Of the two, though, Google is probably the biggest threat to Adobe. Microsoft's recent SaaSy announcements notwithstanding, Google has offered customers a lot of cloud-based apps to choose from, and Gears allows developers to tie them to the desktop to some extent.
Microsoft impressed everyone with its Olympic performance, but that hasn't translated to recurring business.
In the battle for RIA supremacy, what counts is being ubiquitous enough for developers to become so familiar with your app dev environment that it becomes the default choice. When the battle was for the desktop only, Microsoft was Adobe's biggest foe.
But as the battle switches to a hybrid browser/desktop model, Google will emerge as Adobe's biggest threat.