Silverlight brings competition, which is always a good thing.
Some points
Cons:
Pros:
Silverlight isn't a flash killer, it's a tool that allows the vast number of existing Microsoft developers transition to web application development thereby keeping Microsoft in the development game of the future.
I'm a bit skeptical about it. Microsoft doesn't have a great reputation on alternative platforms, since their products on OS X (like Windows Messenger or Windows Media) have mostly been sub-par compared to the alternatives, and on Linux, well, Microsoft has always been the enemy. As more and more people move away from Windows, the chances of Silverlight becoming a defacto Flash replacement are going to keep decreasing.
It also seems to be a trend that more and more sites are eliminating the "unnecessary" use of Flash, in order to support new mobile devices like the iPhone. Instead, AJAX and more JavaScript programming are being used to provide a dynamic user experience, even in extremely interactive websites.
I wouldn't totally discount Silverlight, I see the potential for a "killer app" in websites like Netflix's streaming movies, although nothing that's really caught on yet. I would take a wait and see approach, although if you have a small project where you feel Silverlight would really help I wouldn't worry too much about it.
The biggest problem Silverlight has now is the plugin. It "barely" works on Mac and not at all on Linux.
Also the development tools (Blend and VS) are Windows only. Compare that too Flex (Flash), which runs on Windows, Mac and a Linux beta Eclipse plug-in. Or compare Silverlight to Curl, which runs nicely on all 3 platforms and has development tools on Windows and Linux.
Not to mention, MS is infamous for starting projects and hanging them out to die. So why would I invest any time in Silverlight? I'm a MSDN member. I have VS2008 and I have Blend (running on my desktop). So I'm far from a MS hater. But again, why should I invest the time?
To answer your question: If MS proves that it is really committed to SL and stabilizes the plug-in on all 3 platforms, then I see it as a competitor to Curl and Flash (maybe JavaFX, if Sun can get of it's butt). But until MS releases it's dev tools to other platforms it will remain just another .Net "thing".
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