Google's Writely released; will another sector be squashed?

Online ajax-rich word processor Writely began accepting new accounts today after closing registration when the company was acquired by Google in March. A number of startups who used to compete with Writely will now have to challenge Google.

Writely’s acquisition fueled talk of a Google Office suite of services, a vision made more real by the subsequent launch of Google Spreadsheets and Google Calender. A Google Drive for online storage has long been rumored to be just around the corner and analysts at Gartner have predicted that a Google PowerPoint type service will be released some time this year. (Garnter references Thumbstacks, see also Zoho Show and our coverage of both.)

Writely is collaboration friendly, can import Word documents, save to PDF, OpenOffice, Rich Text Format and zip. The system autosaves your documents every 10 seconds and offers online storage. Google Accounts will soon be used for signing in. Writely works on Mozilla based browsers and IE only.

Writely got the best review in a recent CNet round-up that goes into detail on its features and compares it to Zoho Writer (our coverage), Think Free Online and Glide Write. Other tools in this class include Rallypoint and WriteBoard.

Now that Writely is publicly available in the Google suite, do these other vendors stand a chance? They certainly may, but yesterday’s surrender from calendar company Kiko – with a nod to Google Calendar – certainly makes you wonder.