To be honest, online documents never really were a big sell for me. Frankly, it's an application space that's pretty boring, and ultimately, you sacrifice functionality. What functionality do you get with Google Docs that an "offline" word processor can't provide in spades? Well, just this: Your documents can be accessed and edited from anywhere [that you have a high-speed Internet connection]. That last part is mine, since you won't see that in any marketing phrase for an online word processor. But it's significant.
It may surprise you, but until recently I only had a dial-up connection at home. Because I live in a rural area outside the city, the only option for me was satellite, which I didn't find appealing due to the cost/performance ratio. At work, however, we have DS3, so I had no real Internet deficiency.
My work also provided me with a 4GB thumb drive -- and lanyard! -- so I had an extended sneakernet, and anything that was too painful to download from home (almost everything), I would download at work. Also, document synchronization between work and home was answered by simply keeping documents on the thumb drive. This guaranteed that wherever the location, I always had the up-to-date revision.
So because I had only one high-speed Internet connection, the single advantage Google Docs could provide over Word or OpenOffice Writer didn't exist.
And let's be honest. The interface, while well done for a web app, doesn't compare to a locally running application written for your platform. What is Google Docs, really? It's a word processor running under a web browser. What is Microsoft Word? It's just a word processor. Which program do you think is going to be better suited to the task of word processing, and capable of offering more power? The one that gets to focus its logic on word processing, or the one that also has to be a web browser? Google Docs only has an advantage as a web platform.
When DSL became available in my area, the game changed. I now have a fast, always on connection at the two places where I do most of my work: at home and at my office. My sneakernet has pretty much ceased to exist. If I need to transfer anything I simply use FTP, email, or VPN.
But all of the above methods are kind of clunky for synchronizing files. Our VPN only works with Microsoft clients, unfortunately, and I use Linux quite often when I'm home. FTP would work the best, but there are a lot of extra steps (or extra setup) when compared to just plugging in a thumb drive and clicking on the file you want to edit.
Many of the documents I work on are spec documents for software projects. I don't really need anything more than just basic word processing functionality: headings, emphasis, bulleted lists, tables. Google Docs does all this pretty well.
I recently started to develop a spec for a Perl library, and made this my first real try of Google Docs now that I have more than one reliable high-speed Internet connection. I started writing the spec about a half hour before I left work one day. On the way home, I had some new ideas, and wanted to add them while they were still fresh. This was the moment Google Docs finally began to matter to me. It was the easiest synchronized document edit I had made to date. I just logged in to my laptop when I got home, made my additions, and saved.
Since then, any document that I'll edit from more than one location goes directly to Google Docs.
Google Docs, or any online word processor, only has real value as a web platform. And a web platform only has value where there is a sufficiently high-speed Internet connection available. As that becomes more and more common, online word processing will begin to matter to more people.
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