In his post Why Google Apps is a Serious Threat to Microsoft Office, Bernard Lunn argued that the collaboration features in Google Apps are good enough to take on Microsoft. Commenter Karim took him on, with a well-written defense of MS Office. Also check out Bernard's response and the further debate that ensued. This kind of discussion is what we like to see on RWW, so well done Karim, you've won a $30 Amazon voucher - courtesy of our competition sponsors AdaptiveBlue and their Amazon WishList Widget. Here is Karim's full comment:
This is the perspective of a “skeptical, later early adopter”; the sort of person who Microsoft needs to retain and should have been able to retain easily. I don’t spend time on productivity tools that may at some date make me more productive, but which today are just a frustrating time sink. That describes the majority of people. MS Office can be annoying, but it does work. So any serious alternative has to offer a significant advantage and at the same time make adoption a total breeze.
I think Google Apps has reached that point. The significant advantage is collaboration.

A new study from market researchers NPD has found that 73% of surveyed PC users have "never heard of and never tried...online, browser-based office productivity applications like Google Docs, Google Spreadsheets, gOffice, etc." Roughly 4 percent of respondents said they had heard of these apps and sometimes or often used them.
Blogs around the web are freaking out about how low these adoption numbers are, but I don't think there's really cause for alarm.
This article was a joint collaboration between chartered accountant Jonathan Bradford and computer scientist Ian Leader. They blog at Jay Eye Sea.
In September Google added a presentation application to its Google Apps suite, thus creating an online office version of the
"holy trinity": word processor, spreadsheet and presentation tool. So what's next for Google Apps? What might be the next killer app? We think it will be an accounting system and in this article we will outline why. There are strong benefits to an online accounting service in Google Apps – both to users and
to the targeted advertising-driven business of Google. [Ed's note: we are also running a poll at the end of the article]
To date, there have been a number of online accounting systems developed - e.g. Mint and Xero - which
showcase some of the obvious benefits of online accounting:
Web Office vendor Zoho continues its rapid pace of product upgrades and new releases, with the next version of Zoho Show - its browser-based presentations software. The app has a brand new user interface and a bunch of new features.
The UI changes focus mainly on improving the editing of presentations, which Zoho says now "matches that of its desktop counterparts" (by which we assume it means Microsoft Powerpoint). Also importing presentations has been upgraded. The video embedded below gives a good overview of the changes.
I'm not a big user of Powerpoint, but in my tests I was impressed by the slickness of the Ajax. I was told that a lot of work went into that, especially for compatibility with VML (IE browser) and SVG (Firefox and others).

Yesterday I requested some comparative data from Compete about Web Office products, as a follow-up to our 2007 review of the Web Office space. Specifically I wanted to know how Google Docs & Spreadsheets compared to Zoho or ThinkFree's word processing and spreadsheeting products. Also how Google Apps compared to Zoho, ThinkFree and others. The charts below answer both questions:

This shows that Google's word processing and spreadsheet products have a noticeable lead over what may be its nearest rival, Zoho. This is to be expected, seeing as Google is a big Internet company with a substantial 'built in' user base (via search). It does however prove that Google D&S is the market leader, at least with consumer use, something which a couple of commenters in our Web Office round-up questioned.

Over the next few weeks we'll be reviewing a number of Web product categories on Read/WriteWeb, summarizing what's happened in 2007 - and what to look forward to in 2008. We're starting with the Web Office, a market that underwent a lot of changes this year. Our definition of Web Office is: A Web Office suite is a combination of productivity, publishing and collaboration features. A Web Office both embraces the functionality of desktop office suites (e.g. Microsoft Office) and extends it by using Web Native features.
Probably the biggest change was that Google Apps ramped up this year, starting with the release of Google Apps Premier in February. And 2007 continued the trend of acquisitions in this market, which started in 2006 with the likes of Writely and JotSpot. In 2007 Yahoo acquired Zimbra and Google acquired a number of small startups - including GrandCentral (online telephony service) and Zenter (presentations software).
The biggest disappointment of the year in Web Office? The lack of a compelling web-based offering from Microsoft. Perhaps not surprising, given Microsoft's stranglehold on the desktop with Microsoft Office. But disappointing nonetheless.
So let's explore Web Office in 2007 in depth....
2007 was a very busy year for Google in Web Office. They made a number of important acquisitions, and just as importantly developed their product range and continued integration of those into Google Apps. 
In February, Google released a premier edition of its Google Apps package (previously known as Google Apps For Your Domain). They also unified the product range more, including a re-designed online control panel.
A well linked to post over the weekend was Andrew Miller's notes on a Google Apps presentation. The main presenter was Scott Johnston, former VP of Product Development at JotSpot - one of my favorite Web Office apps that was acquired just over a year ago by Google, but has yet to be turned into a Google Apps product. Well apparently JotSpot is being integrated, according to Miller's notes.
JotSpot is/was a very flexible wiki-based product, which had spreadsheeting and other office functionality. Miller reported that it will spawn "Google Sites" in 2008, which "will expand upon the Google Page Creator already offered within Apps." It will be based on JotSpot collaboration tools and will allow businesses to set up intranets, project management tracking, customer extranets, and "any number of custom sites based on multi-user collaboration."
This sounds like an ambitious product and one that may potentially crack open a lucrative market in businesses: intranets and extranets.
When it's time to do some document creation, there are many reasons to look beyond Microsoft Office. Most of the software available outside of what Microsoft offers, though, can fall short of expectations. One service worth looking into is Zoho. Today, this increasingly popular online office suite implemented full offline functionality for the first of its many different services. (Disclosure: In case you hadn't noticed in the right hand corner of our site, Zoho is an RWW sponsor.)
Zoho Writer, the company's word processing tool, can now be used offline, using Google Gears. If you're someone who has grown dependent on the online functionality of Zoho, Google Docs or an other service - you'll find that it's very exciting to be able to go offline with Gears. It couldn't be easier for the user. If you've got Google Gears on your computer, you can download selected Zoho documents to your hard drive with just a click. The pages for those documents will then be accessible inside your browser, even with when you are not connected to the internet. Someday soon, the company says, the other Zoho apps will also be available offline as well. If you've tried Google Docs, you've probably noticed that it's ugly and awkward. Zoho is far less so, and now offers the advantage of being able to go offline as well. (Your collaboration partner probably trusts Google already, though, so it's not a clear case by any means.)
Indian company InstaColl today formally launched Live Documents, a mini-office suite of products similar to Word, Excel and PowerPoint. Live Documents has already received plenty of press coverage, mainly because it was co-founded by Sabeer Bhatia - the man who famously sold web mail service Hotmail to Microsoft for $400 million in 1998.
Live Documents was built using RIA technologies including Flash and Flex, which the company claims gives it a "user experience that is comparable to native Office software applications." In its launch announcement, Live Documents is being heavily positioned as a Microsoft Office competitor - and complement. On the latter, the company says that "Live Documents is available as a optional desktop client application that wraps around Microsoft Office and embeds collaborative capabilities into these hitherto standalone software applications." There is also offline access.
It's also clear that Live Documents is leveraging the Microsoft brand - from the "Live" brand name, to the claim that it has a “Services plus Software” approach (Microsoft's calls this "software plus services").