writely.gif

Google has acquired Upstartle, the Silicon Valley-based maker of online word processor Writely. It gives Google yet another tool in its kit of applications to take on Microsoft — and brush aside its dominance through the desktop.

There are many similar products out there, in case Microsoft gets desperate to buy one. But then Microsoft would hardly want to cannibalize its sales of Microsoft Office.

Writely got buzz for its cool feature that converts documents into PDF. We mentioned them a few times; this was a good earlier summary of Writely..

But Om, who first sniffed out the acquisition, puts it nicest here, writing before the news was confirmed:

So you all know that Google’s got designs for a G:Drive and doing an end run around Microsoft? Now what if you can simply store and save data on that drive, but that’s not clearly as much fun. What if you could write a document in a browser, much like you write on Microsoft Word, but then save it directly to the G:Drive? That would increase the utility of G:Drive tremendously. Maybe that explains why Google is rumored to be in talks with Writely, a browser-based document processing application, for a possible acquisition.

..Now buying Writely is in line with Google thinking of using browser for everything. I mean an online word processor, and online excel spread sheet make a lot more sense than making people switch to OpenOffice.

And poor VCs. This is another example of the big three (Yahoo, Google, Microsoft) swooping in to buy cool companies before venture capitalists can even invest. Are VCs getting shut out from making money on the best Web 2.0 features? Beginning to seem so.