<p>Is it in best interests of the software development industry for one framework, browser or language to <strong>win the war</strong> and become the de facto standard?  On one side it takes away the challenges of cross platform, but it opens it up for a single point of failure.  Would it also result in a stagnation of innovation, or would it allow the industry to focus on more important things (whatever those might be).</p>

I believe whenever there is only 1 option, it will definitely stagnate innovation.  If all we had was 1 language, then we wouldn't be able to solve anything but what that language was designed to solve.
Imperative languages like Java and C# solve a certain set of problems pretty well, but it also helps to think in a functional manner sometimes, such as with Haskell and Lisp.
Furthermore, cross platform issues are not an issue if you are talking about a web application, because you control the hardware and software (note, I am talking of the server side code of course, the browser cross platform issue is separate).
Paul Graham wrote a
great essay
on how the Web lets you as a developer use the tool you think will solve the problem best.