As of July 30, 2010, this is a new feature in Windows Live Hotmail. You can now open, edit and save documents from MS Office (Excel, Word, etc.) through your Hotmail account. MS is trying to compete with Google Docs so they created the ability to use Office programs withought having the Office Suite installed on your computer. Documents you use or create are saved "in the cloud" on SkyDrive rather than on your computer.
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