More specifically - they are making the move to replace the operating system with a browser. Chrome OS is an implementation of the Chrome browser as the "operating system" of a stand alone computer.
This makes it fast (super-fast), instant-on and a real threat to Windows / Mac / Linux.
In order to do that - they took a page from Apple's book by creating an application-store - but instead of limiting it to the phone/iPad - they made it into a store for web-applications - and added a lot of functionality to the web browser that allow it to act like an operating system, specifically better local-database storage and really fast execution engine.
In other words - this might be the first real threat to Windows since, like, forever.