For now, the Google docs will only allow editing a doc offline, but future releases will allow creating new docs/presentations/sheets as well.
Quite a milestone if Google Apps allows users to create docs offline. Why would you need MS office then?
MS Office’s Live suite, to me is more of a lip service and doesn’t really have any differentiating feature.
The bigger question why is it taking Google to eat it’s own dog food (i.e. use Google gears for other apps, like Gmail, calendar etc), while competition (like Zoho) is able to do it fast?
If the answer starts with B-word and spells Bureaucracy, MS will be a happy company!