Both Microsoft and Google improved their service agreements for online offerings last month, giving IT pros more incentive to move their email and documents to the cloud. 

Web-based services, such as Google Apps and Microsoft Business Productivity Online Suite (BPOS), appeal to cost-sensitive businesses that want to ease the burden of installing and supporting Exchange Server, SharePoint Server, Office and other products.

Source: http://searchwinit.techtarget.com/news/2240031720/Microsoft-Google-sweeten-online-service-SLAs

Google Product Mananger Rajen Sheth fends off claims about the need for rich Office clients, traditional PCs, and alleged shortcomings in Google's hosted apps and SLA policies. 

Google is stepping up its efforts to displace Windows and Office with its own cloud-based offerings: Chrome OS and Google Apps. As Microsoft fights back with the pending release of Office 365, Google is showing no signs of letting up. Rajen Sheth, group product manager for Google Enterprise Business, recently discussed his views on how his company seeks to reshape how knowledge workers use computers and how they collaborate.

Source: http://redmondmag.com/articles/2011/02/01/google-betting-on-evolution.aspx