I’m here at the Web 2.0 Expo keynote, where Stephen Elop, President of Microsoft Business Division, hinted that we may be seeing Microsoft Office make its way to the iPhone some time soon. After his interviewer Tim O’Reilly caught him on the comment, Elop backtracked a bit, stating “not yet, keep watching”. But it’s clear that an iPhone version of Office is on his mind.

Rumors of an Office client for the iPhone have been circling for over a year, as users clamor for a way to edit their Word and Excel files on the go (the iPhone allows them to view them, but doesn’t include any editing functionality).

Unofficial editing suites are also on the way. Today saw the annoucement of QuickOffice, a suite of applications that can edit office files (though it has yet to be released). Also worth checking out is this spreadsheet application.

In other Office-related news, Elop said that Microsoft plans to launch an ad-supported online version of Office for the web, though it won’t be out this year. He also notes that of the 500 million people who use Office, only 250 million actually pay for it. When asked what Microsoft’s biggest fear concerning Office was, Elop said that it was afraid of innovation slowing down, explaining “It’s not about having bolding or underlining in the browser… The real threat is if we’re not continuing to innovate”.