The Browser knew something was afoot when the word "NOTICE" appeared yesterday, in red, at the top of our Writely page. The "planned outage" we were alerted to was the only warning of Google's surprise release early this morning of Google Docs & Spreadsheets, the latest iteration of the company's web-based answer to Microsoft Office. The new release does not so much introduce radically new features as it does combine two products that began life separately: Writely, the online word processor Google acquired last March, and Google spreadsheets, an internal initiative released in June. The headline benefit is that users will be able to create and access their documents from a single location, though there are a variety of other improvements, reports Google Watch.

Beyond criticizing Google for its geeky penchant for plain names, web pundits are busy pointing out how the new release signals Google's intention to go after the lower end of the Microsoft Office customer base. The Wall Street Journal reports that Google chief Eric Schmidt last week said that Microsoft's hold on non-professional users "may be vulnerable." Rafe Needleman at News.com complains that the two applications are not truly integrated ("You cannot embed a spreadsheet into a document, for example. That's lame.") But he also allows that he likes the apps despite "their early stage flaws and omissions," and reports that Google has plans for a "disconnected" version. Obviously, the one big drawback of web-enabled apps, is the potential lack of a web connection....

Needleman and Michael Arrington at TechCrunch also point out that the Google is not the only would-be Office disruptor. In the hunt too is ThinkFree, and Zoho, which, in fact, TechCrunch profiled only yesterday.

The market's looking crowded, but alpha-CEO Steve Ballmer - who's making the media rounds this week in New York in trademark table-pounding style - isn't showing any fear. The imminent releases of Vista and Office, says (shouts?) Ballmer, are the biggest for Redmond since the launch of Windows 95, and at the center of them is the notion of being web-enabled.

This face-off is going to be good.