The moment Google acquired YouTube (around October 2006) I thought they would add a video editing tool to go with it, immediately.
Time went through and nothing. Good tips about what software to buy, but no tool online. Finally around June/July they start offering a 'Remixer' in Beta and while the tool is pretty decent, is not an in house development but a tool powered by Adobe, that it is still on Beta. You can find it at TestTube.
Now, this weekend I got an email from Huffington Post, inviting people to do a candidate's mashup video, using the new tool from Yahoo, called Jumpcut, another pretty decent tool so far.
There are not the only free tools available online, of course. You have also Eyespot and Mojiti but the last one seems to be more useful to subtitle or make comments than to 'mashup' editing from different videos at the same time (still, a very useful tool for websites like mine, where I know that if I can have some of the videos with captions in Spanish part of my 'readers' will thank me for taking the time to include them).
Going back to the main issue of this article: we have now at least 4 tools for editing videos online for free! So start playing, friends acquaintances and readers! Use your creativity and show the world your ideas editing videos, either yours or using the ones online. There are no more excuses!
As I haven't used any of these programs enough to recommend one over the other one, if you play with them and have any tips on which one worked better for you and why, we are all ears! (well, eyeballs in this case...)