Yes it's possible.  The announcement is made at PDC.

The next version of Office will also include a browser based version of Word, Excel, Onenote and Powerpoint.  They aren't the full blown version but kind of express or lightweight versions.  The user can create, edit and collaborate office documents through the browser.  It will work on all browsers except Google Chrome.

You can read more here: http://www.microsoft.com/Presspass/Features/2008/oct08/10-28PDCOffice.mspx