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SharePoint Online also includes the suite of Office Web Apps, including Word, Excel, PowerPoint and OneNote Web Apps, allowing you to work on slimmed-down versions of the desktop applications to work on documents.
Creating a new document is easy. Simply select the format in which the file should be (Word, PowerPoint, Excel or OneNote) and type in the document name.
Word Web App is a slimmed down version of Microsoft Word 2010, as are the rest of the Office Web Apps. Word Web App is automatically updated by the folks at Microsoft, so as and when new features arise, these will appear seamlessly.