Software company Adobe is to enter into the word processing market by acquiring Virtual Ubiquity.
Adobe's acquisition will bring it into competition with Microsoft
The deal means that Adobe will own the online word processor Buzzword, which allows a number of people to edit a document online.
Adobe is best known for its publishing software such as Adobe Acrobat.
The purchase price of for Virtual Ubiquity has not been disclosed but the deal reflects a trend towards to doing office work on the web.
"We were looking for a technology to create a modern word processor," said Erik Larson, Adobe's director of marketing and product management.
"The problem of collaborating on documents is not solved and we think we can solve it," he added.