This means you can upload a rails app and scale it to reasonably large deployments with literally no effort.
For startups (like mine) that's gold. We've been using a variety of server deployments for MyTripScrapbook, most recently a VPS with RapidVPS.com. We hosted out own apache2, mysql and mongrels on debian linux. We had no problem keeping 8 mongrels running in production with 512 MB RAM and this worked great with our Beta test customers and internal staff. However we knew that our first big customer would add 10,000 users in no time. 10,000 users who all wanted to use the application every day for sessions that are about an hour long.
Morph seemed like the best offering available. But it was a different direction than we'd been planning. The biggest change for us was the architecture change to replicated app servers. In later posts I'll describe some morph-specific changes we had to make, but for this post, I'll focus on moving all static assets to Amazon S3.