Microsoft has announced it's plan to offer their Office suite as web applications for as low as $6 per month.  http://news.cnet.com/8301-13860_3-20020029-56.html  They're calling the new service Office365.
The first thing that jumps out at me is the implication that this service could cost more.  That suggests to me that the $6 monthly subscription will be lacking somehow, and users will find themselves having to upgrade to get the functionality they need.
Personally I recommend Google Documents if you're considering online office apps.  It's free, and offers great collaboration features.  http://docs.google.com/
Here's a couple reviews comparing the two services (Note that the second one is over a year old and some information has changed, like the price):
http://en.onsoftware.com/office-web-apps-vs-google-docs/
http://www.pcworld.com/article/168309/microsoft_office_vsgoogle_docs_a_web_apps_showdown.html