Well, Office Live is more like a light version of Sharepoint where you can track document changes and so on, but without basic document editing, I also end up using skydrive all the time. The site has been in Beta for ages, I hope it will integrate with
the online version of the next Office and get a facelift.
I'm absolutely certain that's what will happen. I think they're cooking up something special in Office Live/Office 2014.