It's not direct competition ... I'm using Google's docs to keep my documents online / and for collaborative editing.

I haven't tried any plugins yet for OpenOffice, but it would be awesome if there was a plugin for syncing back and forth to Google Docs.

While Microsoft Office has the majority of the market, growing the network of relatively compatible alternatives is going to help Google Docs.

Probably something to do with the whole "don't be evil" thing. Google has always done a pretty good job of that. Sometimes doing the right thing isn't the same as doing the thing that's best for business. In fact, REALLY OFTEN doing the right thing isn't the same as best for business.

Also the vast majority of Google employees are probably open source users and fans themselves.