I have OpenOffice installed on my main PC (XP64), because I don't need much more than the ability to open docs sent to me or that I download. Works fine for what I ask it to do.
But, my wife, who is an MS Office expert, can't stand it. It is just too limited and clunky compared to Office, she says. So, for her PC, I fork out the $$ and buy Office. Oh, and MS Office is on our shared MacBook.
For the "serious user" market, OO is not currently a threat to MS Office. But for the casual, "use it once in awhile" market, it is. Now, given Microsoft's history of competing against incumbent, entrenched players by targeting the bottom end of a market and improving over time with increasingly competitive but still cheaper technology, they are probably very sensitive to seeing OO become the easy choice for the entry-level user.