But, I wouldn't want to read a novel that way. The reason e-readers have succeeded (either dedicated devices or as smartphone/tablet apps) is that they provide a truly immersive experience that is very similar to reading a book. The ePub format (using by Apple, Barnes and Noble, and the lesser known Kobo platform) is brilliantly designed to flow text (and occasionally images and charts) into various formats without making it seem chopped up in any way.
I'm not certain Google can achieve this successfully in a browser-based solution, particularly if the company wants to support every PC, tablet, and smartphone on the planet. I'm sure they'll be able to develop something that works, but I'm not sure it will work as well. I also think some users might be put off by the web-based option in the same way that some users prefer to use Office on their PC rather than Google Docs (even though Google Docs is free). The interface is more familiar and they don't have to worry about losing their Internet connection. The fact that e-readers only need connectivity to download books, not to read them also gives them an advantage (yes, browsers can do offline content and Google will no doubt build in support for Gears, but the average user may not realize that possibility exists or think it's too complicated to use).
Even if Google is successful with its design of the concept, I doubt people will rely on Editions on anything other than a smartphone or tablet. Reading long passages on a computer (desktop or notebook) produces eyestrain and is generally neither comfortable nor ergonomic.
As far as a catalog goes, however, I see Google eventually becoming king. The company is actively courting smaller publishers and booksellers (often the people left out of the mainstream e-book market), can probably already provide a staggering amount of free material thanks to its Google Books service, and is in talks with major publishers. Ironically, I think the major publishers might be the hardest source for Google to secure. Publishers weren't happy with how Google handled their titles when it came to Google Books and Google is using an untried business model.
Another challenge is that many e-reader owners have made their choice of platform and are most comfortable dealing with the associated retailer. The difference being iOS and Android devices, where multiple e-reader apps are available (allowing users to select books from different retailers based on availability or price).
One thing in its favor, is that Google doesn't need to make a fortune right off the bat with Google Editions. The company's major source of revenue, despite all its services, is search and context appropriate ads. This gives Google time to test its model, fine-tune it, and make it more successful.