In his last column (here or here) webDotWiz introduced Windows Live Skydrive (http://skydrive.live.com) which gives you 5000 megabytes of free online storage to backup and share your documents, pictures and videos.

Now there's another free service, Microsoft Office Live Workspace (http://workspace.office.live.com), which provides 500 megabytes of online storage for your Excel, PowerPoint and Word documents.

The main difference between Skydrive and Workspace is that you can install the Workspace add-in so you are able to open and save Workspace documents from the file menu in Excel, PowerPoint or Word. By the way, Workspace supports Office XP, Office 2003 and Office 2007 and if you're sharing documents with others, those people don't need Office to view the content when you invite them to your workspace.

To set up your Office Live Workspace so it's available from the Office file menu, go to http://workspace.office.live.com, sign in with your Windows Live ID and you'll be greeted with the Workspace welcome screen.

The first job to do is install the add-in that enables you to open and save documents from the file menu in Excel, Word and PowerPoint. You'll have to change over to a computer administrator account to do this so exit the workspace, change accounts, sign in to your workspace again to get back to the screen above.

Click Install Office Add-in and you'll be taken through the usual steps to install.

At this stage you've set up your Office Live Workspace and you've got the add-in installed so start Excel, PowerPoint or Word, load a document and we'll see how things work. In the screenshots below, webDotWiz was working in Word 2007 (psst: what's the strange language his document is written in?).

Go the File menu and you'll see two new options: Open from Office Live and Save to Office Live.

Click on Sign in to Office Live Workspace beta.

We're going to save a file so the workspace File Save dialogue opens. By the way, give things a little time to come up because we're now working across the Internet.

You need to tell Office Live Workspace that you want to save your file in the Documents folder so click it (it'll be highlighted). Type in a name for your file as per usual and click Save. Done.

Now let's check the file is there so go the File menu and choose Open from Office Live. Click Documents to open this folder in your workspace.

When the Documents folder appears you'll see the file listed.

The File menu isn't the only way to save and open files in your workspace. Go directly to your workspace using http://workspace.office.live.com and you'll see there's an Add Document option. This works like the file upload function in Skydrive. As well a message will pop up advising there's a multi-file upload tool available to install.

Once in your workspace, click the New button to see more options. You'll discover that you can create  to-do lists, notes, lists, contacts, events and even new Excel, PowerPoint and Word documents.

Also notice the Share option on the toolbar - useful for team assignments at school and group projects at work.

Office Live Workspace has many uses and webDotWiz will show you more in the future. At the moment you're now able to save your documents online at home or work and retrieve them from another computer connected to the Internet for more editing.

Remember that Office Live Workspace is a part of Microsoft's Office Live Small Business service that is yet to come to Australia (it can't be too far away) which gives businesses online space for a web site, email addresses and the tools for managing and promoting a small business.

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