This is an interesting release for the Mac BU. First, for the first time since possibly Office 97 or Office 2000, there were major changes to the file format on the Windows side. This meant that the Mac BU couldn't really even get started on the said file format code until the Windows side had finished. Not that they weren't busy. Thanks to the Intel transition, the Mac BU had to completely revamp their development process from top to bottom in the middle of a product cycle. So they get bitten by delays on the Windows side and moving to Xcode. Not a fun time.
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For anyone wondering why Adobe was able to get CS 3 done so much faster than Microsoft could get Office 2008 done, "waiting on the Windows version" had a lot to do with it. While I don't know for sure, I highly doubt the CS Mac team has to wait for the CS Windows product to be done before they can do the majority of their work. Keep in mind that while the WinOffice team is a major part of Microsoft as a corporation, the Mac BU is a wee small bump on the org chart, buried down in the entertainment division.
The problem is, whatever the reason, the delay in Office 2008 puts this application in a place it has never really been: No longer the top dog, or really, the only dog for productivity software. On the low end, iWork is a more than viable solution. At the same level, you have NeoOffice and OpenOffice. The big disadvantage to iWork is Exchange. If you need Exchange, you're stuck with Mail, and if you think Entourage is a pain to get working with Exchange (it really isn't, but that's the popular perception), and is "crippled" compared to Outlook, well good luck with Mail, it's worse. Even with various add-ons available for Mail/iCal/Address Book, they're still not as functional as Entourage.
NeoOffice and OpenOffice have more functionality than iWork, (and if you count VBA, more functionality than Office 2008), but and this must be said they are on the ugly side of "kinda ugly" and neither really are a part of the Mac OS. They're there, but they are limited in how you can integrate them with other applications other than what you can do with files. Neither, on the Mac, includes an email/groupware client, so you're, again, required to use Mail/iCal, but with almost no integration abilities. In theory, Sun is going to release a "native" Aqua version of OpenOffice, but what I've seen so far is, shall we say, "uninspiring" from a UI point of view. And let's face it, Sun's been promising this for a looooong time. I'll believe it when I see the final release.Next page: Why this release is not destined for great sales