Microsoft finally struck back against Google Docs, the Internet search leader's web-based software suite, but today's move looked more like a half-measure rather than a decisive knockout blow to many tech watchers.

The Redmond, Washington, software giant today introduced Office Live Workspace, "a Web-based feature of Microsoft Office that enables people to access their documents online anywhere and easily share their work with others."

The move suggests that Microsoft feels it can no longer wait as Google and Adobe move aggressively to shift the locus of software from individual PCs to the web.

At the same time, Microsoft is also making clear that it isn't willing to go all the way with web-based software. Instead Office Live Workspace is merely "an extension to the client-based version of desktop productivity software," Mary Jo Foley said on her blog.

Office Live Workspace will offer users 250 MB free to store, share, and collaborate on Office documents. However, as Ken Fisher at Ars Technica points out, "you cannot create new Office documents with this feature nor can you edit documents beyond adding comments without having a copy of Microsoft Office installed locally."

As such, he notes, Office Live Workspace "is not an online office suite," and thus "is not a 'Google Docs killer' or even an 'answer' to Google Docs."

Microsoft's continued refusal to wrench itself from its dependency on "client-based" desktop software—thus protecting its lucrative Windows franchise—drew a sharp rebuke for being short-sighted from TechCrunch's Michael Arrington.

"Microsoft Office warriors are re-branding, repackaging and relaunching old products and calling them new," Arrington wrote this morning. He added:

Google and other Office competitors will be breathing a sigh of relief this morning—this is not a decisive move by Microsoft to crush the competition as they did with Netscape more than a decade ago. Microsoft has failed to understand the real power of Google Docs—easy, no hassle document creation, collaboration and access from the browser. And it will take them another two years of fidgeting before they really get scared and react properly. Microsoft is falling into the classic trap of failing to realize the disruptive nature of a new competitive technology, instead focusing on the massive revenues it generates from their aging Office suite. Google Docs is tearing the Office wall down, and Microsoft has failed to respond. What a bummer—it would be a good fight if Microsoft would actually get into the ring.

Microsoft's move comes one day after Adobe moved aggressively into the web-based software space by purchasing Virtual Ubiquity, the maker of Buzzword, for an undisclosed amount.

Adobe executives were expected to formally announce the Buzzword deal its Max 2007 developer and designer conference, which starts today in Chicago, CNET's Martin LaMonica reports.

Competition in the web-based software space continues to heat up, but at least for now, with Microsoft's half-hearted foray into the arena, Google and Adobe—not to mention scores of smaller web software services startups—may have dodged a bullet.

by Sam Gustin