Much of the buzz in the software-as-a-service (SaaS) arena lately has been the budding battle between Google and Microsoft, with Google’s lightweight Web-based applications offering an alternative to Microsoft’s ubiquitous Office productivity suite—a challenge Microsoft is not taking lightly, with the company now offering online collaboration features via Office Live Workspaces.

Now, it looks like software giant Adobe, mainly known for Acrobat and its applications aimed at high-end creative users (Photoshop, Illustrator, Flash, etc.), may be eyeing the SaaS sector: the company has just announced it has acquired Boston-based Virtual Ubiquity, makers of the Flash-based online word processor Buzzword.

Buzzword bills itself as the “first real word processor for the Web,” and aims to provide a high-quality, design-oriented what-you-see-is-what-you-print word processing environment within a Web browser, with both document management and online collaboration features built right in. Whereas both Google Docs and Microsoft’s online editing features have (so far) relied on a bare-bones approach or the support of desktop applications, Buzzword aims to provide control of document layout and presentation akin to what users might find in a mainstream document layout application. Buzzword is designed to work both online and offline, and supports Windows, Mac OS X, and Linux systems.

Terms of Adobe’s acquisition of Virtual Ubiquity were not disclosed. Adobe says it plans to invest in the Buzzword application by leveraging its AIR runtime environment, integrate its own document collaboration technologies and PDF-generation capabilities. Adobe says it also plans to implement support for bring PDF documents into Buzzword, along with supporting ODF and other formats over time. Buzzword currently supports RTF, Microsoft Word, and Word 2003 XML files.