I just taught a two day .net course. Yes, .net will change the face of the internet as web services catch on. If you can figure out an appropriate web service, you can make a ton of money on it (the next .com wave, except it will be the .net wave).
Web services are components that you can call from your web site or program. They reside on the web server. You communicate with them through an open standard called SOAP (simple object access protocol), which is XML over HTTP. This can be done from a linux box to a linux box; it is not Microsoft proprietary. Where Microsoft hopes to win on this is by making it easier to develop web services using their tools and platforms than any other tools and platforms. SOAP is not spyware; it is still peer-to-peer.
Some possibility, although web services will be transparent to most users so they could work through an IP address and not even have a domain at all. Think of web services as internet DLLs. Code can hook to them and call them, except do it across the internet. The calls can be between code written in two different programming languages running on two different operating systems and it will still work.