Speaking to analysts at a Goldman Sachs investor conference that was Webcast, Ozzie said that Google's Docs & Spreadsheets, like other online rivals to Microsoft's Office suite, is a "trade-off."

"Ever since the [dotcom] era, technologists have been trying to see how much of the Office experience we could take up into a browser and make usable in some form," Ozzie said. "Yes, there's Google Docs & Spreadsheets, there's ThinkFree, Zoho -- there are a variety of different instances of people taking the tools and kind of replicating them up into a Web environment."

Last week, Google rolled out , a US$50-per-seat-per-year package that includes Docs & Spreadsheets, 10GB of mail storage and access to development APIs.

"In the pure Web model, the trade-offs are fairly substantial. You have to be online to use them," Ozzie said. That's not the model he sees Microsoft using.

"The way that I view the services opportunity related to productivity is really about more than just taking what's on the PC and putting it up on the Web," said Ozzie. "I think there are high-level scenarios that if you consider you've got software on PCs, services in the cloud and devices, mobile devices, as the power that you can work with, and you try to envision the value of productivity, and what you're trying to offer, you end up with a different result."