One size does not fit all. That's why elastic was invented; elastic stretches enabling "one size" to "interoperate" across sizes. Interoperability does not happen on it's own, it must be facilitated. Ok,....so what does this have to do with Office 2007? Good question and thanks for asking.
For those that have been living under a rock, Office 2007 introduces the OpenXML format. OpenXML enables the richness of the Office 2007 documents to be fully described with XML. We started this process with Office 2003 but the OpenXML format is so much better. OpenXML supports the digital signatures and signing of documents, document routing and workflow. Can OpenXML be customized? Duh...that's what the X in XML means so yes you can create your own schemas. Remember elastic? This extensibility enables interoperability with other systems. Therefore you can convert between formats. OpenXML is going through the open standards process, currently with ECMA International and then on to ISO. If you want to learn more about OpenXML, check this out and this one too.
OpenDocument Format (ODF) is the Open Office standard and has already been through OASIS and ISO and represents the state of the art.
An open source project has been funded to build translation tools between the OpenXML and ODF. With these tools, customers will be able to read and write to ODF from Word, Excel and PowerPoint. Well if we had the ODF standard why did we need another one? Well, ODF currently does not support things like accessibility and spreadsheet formulae as well as all the Office 2007 features. Having the open source project will provide for ongoing interoperability as these 2 formats continue to evolve. The Interoperability Center for Office 2007 will be an add-in that adds itself to the file menu in Office 2007 where users can get .PDF, .XLS, and .ODF interoperability.
Anxious? Go and download the first prototype from sourceforge.net which is an add-in for Word 2007. If you are really hungry, then go dive into this:
As a developer, XML is the format you want for both interoperability and line-of-business integration. The Office Compatibility Pack will give older versions of Office the ability to use OpenXML. pretty cool...