As of last night, you can now edit your YouTube videos in the browser. Just visit the YouTube 'idea incubator', TestTube, and click Video Editor.
http://www.youtube.com/testtube
It's a simple editor -- attempting to do anything more complicated is still a year away, I think -- but it does spell the beginning of the 'final cloud frontier'. Video has long remained one of the few formats that shies away from cloud processing: it's not only too large for standard Internet connections, but it also requires a lot of CPU cycles to edit. Still, it seems YouTube -- Google -- has found a way to offer rudimentary editing to its millions of users.
By virtue of its limited feature set, it's incredibly simple to use. Just drag and drop videos into the timeline, trim those clips if you like, and then choose an audio soundtrack -- you can't splice together different audio tracks unfortunately!
It's a great start, but I really wonder what the YouTube team has up its sleeve in terms of future features... we might be seeing video transitions (fades, swipes, etc.) and other basic effects like the ability to add credits and titles.
