There is also the possibility of having the best of both worlds. In one sense, this is the whole idea of SOA -- having loosely-coupled services, so that if I change or remove a service it shouldn't break the system (in an ideal world) -- and it allows me to gradually add services to the composite application over time.
Your example with an Excel application is especially interesting because it is a very common problem on Wall Street. We at GigaSpaces have joined forces with Microsoft to develop a solution for this. We call it Excel that Scales. It allows users to use the Excel they know and love as front-end, but maintains data and business logic centrally.
I blog about it here and you can find more info on the solution on Nati Shalom's blog - here.
A white paper we co-wrote with Microsoft on this solution should be published any day now on our web site, and on MSDN. So stay tuned.
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