You haven't directly made use of the serial communication between the host computer and the Arduino board. First, I'll describe how to write a basic client/server style program.

To make things easy for the common user, he wrote a library called EasyTransfer which abstracts packetized serial communications between two Arduino boards.

It generates the clock, acts like a serial port, acts like a disk drive, and so on. However, the ATMega32 doesn’t directly have Arduino IDE support so you have to install a toolchain for it.