Microsoft has renamed Office Web Apps on February 19 as part of its strategy to hold on to its one billion Office users rather than to have them attracted to rival Google. The suite of free software is now officially called Office Online, and supports real-time co-authoring, a popular feature on the competing Google Docs.

The software in Office Online continues to be available on OneDrive (formerly SkyDrive), Microsoft’s cloud storage offering, or on SharePoint, but can otherwise be found at Office.com, says Amanda Lefebvre, the Product Marketing Manager for Office Online in a blog post about the name change.

Word Online, Excel Online, PowerPoint Online and OneNote Online can otherwise be accessed for free on Office.com with a Microsoft Account (available with any email address), and the ease of collaboration is key. Users can work together on documents, presentations, spreadsheets and notebooks in real-time. Files are automatically saved to OneDrive, ensuring a demand for the cloud storage service. The files can also be edited with desktop versions of Office, said Microsoft.

The new online experience includes hundreds of free Word, PowerPoint and Excel templates as well, Lefebvre added, giving Microsoft an advantage over competing office software suites.

Microsoft still offers paid versions of Microsoft Office through the cloud-based Office 365, which has a five-desktop plus five-mobile licence package for families at US$99.99 a year, a single-user install at US$139.99 for students, and a similar install for general use at US$219.99.

The Office 365 version is packaged with Microsoft Publisher, Outlook and Access in addition to Word, Excel, Powerpoint and OneNote; the student version is similar to what is available for Office Online, while the general version also comes with Outlook.

When given a choice between having to pay and having it free, it is likely that users will go for the free versions as their first choice. In return, Microsoft knows who they are through their Microsoft account and can possibly reach out to them in other ways. It’s a win-win situation for both.