It might seem like there are enough word processors on the market and there is absolutely no reason for any company to go through the expense of developing another one when Microsoft (News - Alert) owns the market and Google is coming on somewhat strong.

 

However, Adobe has been watching this competition and decided it can do an even better job than Google (News - Alert) in the desktop application business by leveraging its knowledge of graphics.

Enter Adobe Buzzword Beta, a software-as-a-service (SaaS (News - Alert)) offering that competes with word processing products from Google and Microsoft. I had a chance to demo the word processor and am very impressed with the graphical capabilities it possesses. It could possibly even be mistaken for desktop software.

A sample Buzzword document which subscribers can access in read-only mode:

 

The word processor is smart, notifying you of mistakes such as trying to post a graphic from the clipboard:


You can also add graphics easily into documents and have them automatically flow:

Tables are no problem either:

Adobe has slowly become a major force in technology but, compared to Google, the company is still operating far under the radar. It owns VoIP collaboration tools, conferencing, and amazing graphical design products — not to mention Flash and Acrobat. The company is slowly organizing its various applications to work more cohesively with one another. As this starts to happen, expect there to be more pressure on Microsoft, Google Cisco (News - Alert)/WebEx and other major industry players.

Of course the important question worth asking is: Will Adobe's hosted applications have an advertising model associated with them? Assuming the answer is yes, and it becomes part of the company's strategy, will Adobe have a relationship with Google to show ads? Would Google go for this? Would it be better to work with Yahoo!?

While on the topic, would Yahoo! and Adobe make a good combination? The two both have tremendous Web reach but few competing products/services and Adobe understands graphics. As the Web becomes more graphical and Web users embrace SaaS, doesn't it make sense to combine a very large ad network with a company which can design graphically superior hosted services?

Both companies have market caps in the mid $20 billion range so a merger of equals may make sense. This could be extreme — perhaps just a memo of understanding would work between the two companies for now.

I suggest you give the Buzzword service a try and once you do, you can check out the somewhat silly document I created. One warning: This service could crash your browser quite often, so get in the routine of saving your work often.