commentary Forget Google and Zoho, it will be Microsoft that takes the online word processor to the masses.
By making their Office 2010 applications available as regular client applications and as web applications, Microsoft has made Office completely cross-platform in one movement. It's a cunning ploy that will entrench Office to an even greater extent within organisations and push its SharePoint infrastructure.
Time is running out for users that survive as an island of non-Word usage in a sea of Office users. Anyone that doesn't fit in with the enterprise Office hegemony will be pushed onto the web versions of Office.
The web versions do not need to be hosted in some far-away datacentre, they can be hosted on-premises in the same way that SharePoint is now — same hardware, same sysadmin. (Should you want it though, you will be able to have your Office applications hosted in a large datacentre managed by someone else.)
One issue that has inhibited large deployments of web-based applications is trust. It's unlikely that a banking organisation is going to be uncomfortable having its large spreadsheets in a vendor's datacentre. But with an on-premises Office web app server, it will be no different to saving to SharePoint now. Online Office documents will also come with the full gamut of DRM that is available in client Office documents.
It's not exactly the same thing as uploading your balance sheet into Google Apps, but it is a first step away from the desktop experience.
Office is hardly a product that needs to get increased marketshare in business, but this release comes out swinging at its competitors that up until this point might have thought that they were getting somewhere.
Will an IT decision maker seriously choose Google Apps over Office 2010? I just can't see it happening. There is an enormous amount of inertia and investment from organisations in Office and simply being a web app word document is not going to cut it any more if Office is perfectly capable of that as well.
The one place where Google and other applications will be able to have the upper hand is price. But free alternatives have been around for a long time and barely put a scratch on Office's marketshare.
This version of Office has cut off the current angles of attack from its competitors and looks to once again rule over the productivity landscape. And that's a sad thing. This version of Office is a response to competition, and if Office can again rule unchallenged, it will likely stagnate and create a new run of feature-bloat.