Google spreadsheets are here, bloated office suites will soon be dead!
Dead-easy realtime collaboration (as in "grandma would get it") is included, and I think this is going to be the killer feature of such connected applications, the one that will prompt people to switch.
Such lightweight tools will finally help people realize that most functions of the common office suite (a concept that dates back to...a long time, not?) are YAGNI. Yet many people use those features (or at least try) because they're here, and waste a huge amount of time doing it, without having a real need.
I'm looking forward to a simpler computing environment for Joe User!
It seems like Google are being clever in launching the wordprocessing component after the "smaller" things like mail, calendar and spreadsheets. Once their browser-based lightweight wordprocessor comes out, it will attract the attention of the masses, and these will be happy find that these other tools are already there. Sounds like a good strategy to get people to switch and never come back to the old way of working.
I'm betting on a massive switch of "average" users to browser-based office tools within 18 months. Maybe earlier if competition puts more pressure in the market.