The New York Times‘ David Pogue writes this morning about some of the outcroppings of new innovation at Microsoft, apparent through the newest version of Office Live for Small Business.

The product takes the “Webification” issue to heart by allowing tech illiterate SMBs to get up and running with a suite of tools for developing and hosting a Web site. This includes free hosting, analytics, and more compatibility (Firefox and Mac) and simplicity than previous versions.

In addition to upsells for added functionality to manage operations (track employees, resources, reservations), a good possibility for the product’s positioning is feeding SMBs into online advertising (via adCenter). This is similar to Google’s intended strategy of integrating AdWords campaign management into the workflow of Quick Books’ massive installed base (an integration that arguably hasn’t reached its potential).

As the tenets of Webification go, one of the benefits of being the one to bring small businesses online in the first place is to establish the trusted relationship to then be the provider of choice for their evolution to paid online advertising. Through this version of Office Live for Small Business, it’s apparent that Microsoft gets this. The proof will be in the execution.