Today I chatted with Jeremy Vincent, CIO of Jaguar Land Rover, on his choice of Google Gmail for 15,000 users. You'll read the details of that decision in an upcoming story. But an interesting aside from the Gmail deal is Vincent's interest in Microsoft's plan to put its Office suite in the cloud.Although U.K.-based Jaguar Land Rover is moving off Microsoft Exchange and Outlook to Gmail, Microsoft is still an important vendor. Next month, Microsoft has invited Vincent to meet with some of its execs to learn about what it's doing in cloud computing. My guess is he'll get a spirited pitch on the 2010 release of Office Web Apps. Microsoft already offers Exchange Online, and recently dropped prices on its cloud-based email, making it a little more competitive with Google Gmail on cost. While Vincent had many nice things to say about Gmail (again, more on that later), he said other things in the Google Apps suite-Docs, Presentations, Spreadsheets, etc.-will not upset his 15,000 desktops of the Office suite. "I don't see Microsoft Office yet being replaced with Google equivalents," Jeremy said. If he did that, particularly among power users of Excel and PowerPoint, "I think I might start a mild rebellion."

To this CIO, the idea of Office in the cloud is interesting. "We find it increasingly difficult to manage the refresh cycle and deployment cycle of Office, and increasingly difficult to keep up as people move around the business," he said. Another problem with Office desktop licenses is staying compliant; in the cloud, vendors handle compliance and updates. And browser-based apps would let Jaguar Land Rover use less power, and then be "driving a green agenda and reducing energy costs," he said.

But the question is whether Office Web Apps will provide any improvements in functionality over Google Apps. In a recent conversation, Microsoft's corporate VP of online, Ron Markezich, told me that Office Web Apps won't have all the functionality of the desktop versions of Excel and PowerPoint. Part of this is likely technical-stability is difficult when some serious digital crunching is happening over an Internet network-but strategy also plays a huge part. Microsoft sees itself building multi-faceted accounts for enterprise customers that include desktop Office licenses for the power users, or those without reliable Internet connections, and Office Web Apps for the others.

Either way, Microsoft is retaining strong loyalty among serious users of Excel and PowerPoint. And so far, there isn't an obvious cloud alternative.