>The basic idea is this: an Unhosted app lives on a web server and contains only source code. That source code is executed on a user's computer and encrypts and stores data on another server. That data never passes through the app server. Therefore, the app provider doesn't have a monopoly on your data. And since that data is encrypted, it can't be exploited by the data host either (or at least, it probably can't).
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>The data can be hosted anywhere. "It could be in your house, it could be at your ISP or it could be at your university or workplace," says de Jong.
I really hope this Unhosted model takes off. Letting me host my own data for use by 3rd party services could help prevent lock-in. Imagine if my Delicious bookmark data was already hosted on my own server, and Delicious shutting down only meant I had to point a compatible app at the same self-hosted data store I'd been using all along?
from *[Unhosted: Breaking the SaaS Monopoly - ReadWriteCloud](http://www.readwriteweb.com/cloud/2010/12/unhosted.php)*