The one thing I will bet on for an improvement in .mac is push EMail for the iPhone. This seemed like such a natural.
I could also see lower prices and a free "back to my Mac" for all Leopard users.
Basically, much closer integration with Mac, iPhone, AppleTV. This - personal Internet storage - is the nexus that brings them all together regardless of physical location. It's not really how MUCH Internet storage you have, it is that this storage is available to all your Internet-connected devices no matter where they are in the world, and that they are available 24 hours even if some or all of your devices are temporarily offline or asleep.
It's like EMail. I can send you an EMail anytime, even if your computer is offline, because 'the Internet" stores it until you get back on and check it. This can be extended to many other kinds of services. If all your devices are on .mac, shouldn't I be able to transfer a file to your laptop or phone immediately, even if it is offline at the moment, using .mac as intermediate, transparent storage. I've uncoupled my uploading to you from your downloading from me. Or, using .mac as a transparent buffer, I can quickly upload a huge file (seemingly directly) to your phone, which (in reality via .mac) slowly trickles into your phone through EDGE and/or WiFi. Syncing and Time MAchine backups could be helped through this as well. This sort of transparent cache or buffer has tons of possibilities and I hope Apple will exploit some.