Changes have been made throughout the story to reflect this. The story now reads as follows:

Microsoft has begun testing some Web-based Office applications that will be delivered through Office Live Workspace, its online adjunct to Microsoft Office, and will give the company a closer rival to online application suites such as Google Docs.

Microsoft will begin a public beta test of what it calls the "Office Web applications" later this year. They will allow users to create and edit new documents online from within a Web browser, said Justin Hutchinson, group product manager for Microsoft's Office Client division, in an interview at the Consumer Electronics Show in Las Vegas.

That's a significant change from the capabilities in the beta of Live Workspace available today, which requires users to create documents using a copy of Office on their PC and then save them to the Web, where they can then be shared with friends and colleagues.

Launched last March, Live Workspace marked the first tentative steps by Microsoft to put its lucrative Office franchise on the Web. More than 1.5 million people have signed up for the beta since it was released, said Michael Schultz, director of product management and marketing for Office Live Small Business.