Will Web-based office suites beat Microsoft at its own game?

In defending its decision not to field (at least so far) a Web-based version of Office, Microsoft officials often play the "offline" card. No one will want to use Google Apps, Zoho, Zimbra or (insert your favorite Web-based productivity pack here) because they don't allow users to work offline.

It looks like that argument is about to fly out the window (no pun intended), given recent announcements by Zimbra et.al, that they are releasing offline-capable versions of their suites/browsers/tools.

So what will be Microsoft's retort? Will Microsoft bow to pressure and lob a Web-ified version of Office into the crowd? After all, Microsoft already has an offline office solution (Microsoft Office). Microsoft has the opposite problem that its competitors do: It needs an online offering that will sync up with its fat-client product.

In spite of the growing raft of announcements around offline-Web-office solutions, I still don't think Microsoft is going to release a Web-based version of Office. (A Web-ified Microsoft Works -- maybe; a Web-ified Microsoft Office -- no.)

Instead, as noted last week, I think the Softies will espouse a different solution: Release hosted versions of Exchange Server and SharePoint Server. This will give users -- primarily small-and mid-sized customers -- who are interested in Web-based hosted email, document-management and portal wares.

Supplement these with some of the Office Live services that are out there, mix in some of the Windows Live products (instant messaging, blogging tools, etc.), toss in a hosted version of Microsoft's Live Meeting conferencing service, and Microsoft would be able to claim it has an online/offline solution just as robust, ifnot more so, than those of its competitors.