The latest Google Docs update goes a long way towards making Google Docs a viable alternative to desktop software, at least for the adventurous.

Until now, my primary gripe about Google Docs has been the need to custom format everything. Now, you can set custom paragraph styles, which makes formatting much easier. I’d like to see further updates, including a custom document template (margins, etc.) and custom list styles, but this is a big step forwards.

Unfortunately, Microsoft’s Office Live cloud software is still a few steps ahead of Google Docs, with web apps that closely replicate the desktop experience. Plus, since it is Office, it is easy to take advantage of the desktop as well as the cloud. Google has a few steps left to go on Google Docs.