Your analogy is weak at best, -- office suites aren't really an algorithmic problem ... Google beat out Lycos, Excite and Altavista because it created a better algorithm for indexing and organizing information.
Office suites are about features -- lots of them, thus entering the market competitively requires man power not intelligence.
Is there room for improvement... certainly. But it is incremental improvement. I just don't think its the type of area where some killer new idea can shake up the entire space.