Lord knows there are many, many choices for video editing software. Most of them follow the "timeline and bins" model popularized by Avid almost 20 years ago. Avid and similar platforms from Apple (Final Cut Pro) and Adobe (Premiere Pro) now dominate professional video and film editing. And, up to the YouTube era, even consumer editing software looked like Avid (Pinnacle Systems, one of the leaders in the consumer business, is actually owned by Avid.) However, there's a dawning recognition that most video editing programs are simply overkill for consumers.
Apple's iMovie 8 and Adobe's Premiere Elements 4, the most recent versions of each company's consumer editing software, have adopted a much simpler user interface. They're both a lot easier to use than previous versions, but they're also much less flexible.
On the other hand, Pinnacle's latest package, Pinnacle 11, has gotten even more sophisticated; the Ultimate version comes with hundreds of special effects, noise reduction, music composition software and even Chroma Key capabilities with an included green screen.
The job of a video editing package, or any tool, is to make it as easy as possible to get the results that you want. Any director or editor will tell you that they actually use a very small number of video transition--fades and cuts--when they're editing. Yet, the sophisticated consumer editing packages have hundreds of transitions (wipes, 2D and 3D effects,) the vast majority of which never get used. They add to the complexity without adding any real value, but they look great on the box.
Pick up a copy of any consumer-oriented video magazine, and you'll see dozens of articles and ads that assume that readers want to be the next Spielberg. but I really don't think that's the goal of most videomakers in the YouTube era. If the continuum runs from Daddy and Mommy wanting to show how cute their new baby is on one end, to the next Steven Soderbergh on the other, most people are somewhere in the middle. They want to entertain and communicate, and they want their videos to look and sound good. For them, the "easy" software (including online services such as Adobe Premiere Express, Eyespot, Flektor, Jumpcut, Kaltura, Motionbox and One True Media) isn't enough and the "complex" software is too much.
Thus, the opportunity that I see is for editing packages that work the way real editors do, with enough functionality to produce good-looking results in a minimum of time, but without all the unnecessary "gingerbread" of the high-end consumer packages. Could someone "de-feature" an editor such as Pinnacle 11, write it in Flash or Java, and make it an online service? At IBC, Forbidden Technologies launched a service called FORscene, which is a step in the right direction, but there's lots of room for innovation.