Google just launched the feature I was kvetching about yesterday when I covered Zoho: an integrated file system for its productivity applications. Until now, documents created in Writely and in Google Spreadsheets lived separately. But in the new, publicly-available Google Docs and Spreadsheets, at docs.google.com, all the documents you create in either Docs (no more "Writely") or Spreadsheets are displayed in one interface, where you can tag your files, and sort them however you want. It's a big improvement.
Google is also bringing the user interfaces and the feature sets of the two applications closer together. Both look very similar, and both have similar common functions, like import and export. But it's clear that the Google apps were built by separate teams. Little differences give it away: The collaboration function is a separate page in Docs, but a right-hand panel in Spreadsheets. Spreadsheets also has a built-in chat feature to compliment its real-time group editing capability. Docs has no chat (although it does have group editing). On the other hand, Docs lets you see a list of all the revisions other users have made; Spreadsheets does not.
Most importantly, although you can see all your files in one place, the two applications aren't really integrated. You cannot embed a spreadsheet into a document, for example. That's lame.
Today's release of Google Docs and Spreadsheets is a step forward, and I trust that Google will continue to improve the feature set, usability, and integration of these two products. At a preview for bloggers earlier today, we heard about some future plans like integration with Gmail (when you get a word processing file or a spreadsheet as an attachment, you'll have the option to open the file in Docs and Spreadsheets). The team is also working on APIs, so other programmers can access the functionality of the applications. Also, Google is going to "take a shot" at a disconnected version, for users who want to access files when they are offline. And they're working on other applications, too.
I like Google's online applications despite their early-stage flaws and omissions. They're easy to use and their collaboration features, while basic, set them apart from standard office applications. People looking for clean and simple online applications will find Google Docs and Spreadsheets useful. Those who need a more fully-developed online suite right now should check out Zoho and ThinkFree. This market is moving fast; it's being reported on TechCrunch that Zoho will launch a more complete and very tightly integrated online productivity suite, Zoho Virtual Office, at the Office 2.0 Conference.