In line with its software and services strategy, Microsoft Corp. on Monday announced new services such as Microsoft Office Live Workspace, a new Web-based feature of Microsoft Office that lets people access their documents online and share their work with others.

The new strategy departs from the company’s current model of selling licenses for software that runs locally on computers, and takes it a little closer to competitor Google Inc. which offers online versions of its productivity applications suite Docs, which includes spreadsheet, word processor and presentation software.

Another competitor, Adobe Systems Inc. announced Monday that it has signed a definitive agreement to acquire Virtual Ubiquity Inc. in Waltham, Massachusetts and its online word processor, Buzzword.

Adobe also added a new file sharing service to its current online document services. Codenamed “Share,” the beta service will make it easier for people to share, publish and organize documents online, the company said.

Buzzword was built with Adobe Flex software and runs in the Adobe Flash Player.

The announcements by Adobe and Microsoft signal the online office productivity market is heating up. IBM Corp. announced last month its Lotus Symphony productivity software, which boasted 100,000 downloads in its first week of availability. The software is based on open-source office productivity software from OpenOffice.org, and is available as software running on the desktop only.

Microsoft’s Office Live Workspace is currently in a beta phase, and open to any user to register.

Available free, Office Live Workspace is among the first in a new wave of online services from the company. Users can save more than 1,000 Office documents to one place online and access them through the Web, and share the documents with others in a password-protected, invitation-only online workspace. Other users who don't have a desktop version of Office software can still view and comment on the document in a browser, Microsoft said.

If users want to edit the text, they must open the document using an installed copy of Office.

Microsoft also announced Monday it will sell its Exchange, SharePoint and Communications server software as online services over the Internet to enterprises with 5,000 or more users. The company also opened Monday Exchange Labs, a research and development program for testing next-generation messaging and unified communications capabilities in high-scale environments. The Exchange Labs program will initially include select universities and school districts.

The IDG News Service is a Network World affiliate.