For the longest time, pundits said that Google’s Chromebook initiative wouldn’t amount to much because Chrome OS couldn’t run complex applications like Photoshop. Those pundits will have to find another example now, because starting today, Photoshop will run on Chrome OS and on Chrome for Windows (if you are an Adobe education customer).

This new streaming version of Photoshop will be available first for Adobe education customers with paid Creative Cloud subscriptions. Clearly, the company is using this group as its beta testers for this project and its unclear when Adobe plans to launch this to a wider audience. The company is hosting its MAX conference next week, which would be the ideal staging ground for a wider launch, but that would be an awfully brief beta period. Adobe says the project will be available to its education customers for at least the next six months.

According to Adobe, this is the complete version of Photoshop, but it will run in a virtualized environment, so you don’t need to install anything on your local machine. Opening, saving and exporting files is handled by Google Drive. The only thing this version can’t do for now, however, is use any GPU dependent features in Photoshop and it also can’t print.

Any moderately powerful PC and recent Chromebook from the last two years should be able to run this streaming version of Photoshop, but Adobe recommends a 5 mbps Internet connection, so your AOL dial-up isn’t going to cut it. If you ever lose your connection while you are using the service, your work in progress will be available in a recovery folder on Google Drive.

Earlier this year, Adobe launched its Creative SDK, which makes quite a few cloud-based Photoshop features available to mobile developers. This full version of Photoshop for Chrome is based on some very different technologies, but it does show that Adobe is taking the cloud very seriously (and is not just looking at it as a distribution mechanism for its applications). I’ll be interesting to see if Adobe also plans to bring any of Aviary’s technologies over to Photoshop in the browser.

Photoshop is a logical first application for Adobe to test this new delivery mechanism. Running a full video editing suite in the browser is a bit harder, but some of Adobe’s other tools like Dreamweaver of even Illustrator could work quite well in the browser, too, but the market for them is likely smaller.