NEW YORK (The Wall Street Journal) - When you hear that Apple has released a new product, you think of a sleek Macintosh laptop, or perhaps a beautiful program for editing videos. But a spreadsheet? Not a spreadsheet.

After all, expertise with spreadsheets is the sort of computing skill about which the "Mac guy" in Apple's TV ads mocks the "PC guy."

And yet, last week, Apple binught out a new spreadsheet program called Numbers, thus completing one of its least-known products: a productivity suite called iWork. The iWork '08 suite, which competes with the Macintosh version of Microsoft Office, also includes a word-processing program called Pages and a presentation program called Keynote.

The two were upgraded last week. IWork costs $79, about half the price of the lowest-cost version of Microsoft Office, which sells for $149.

In the past 10 years, Apple has out-designed Microsoft and its hardware partners in a number of key crease But can Apple really take on Microsoft in the category of productivity software, where Office rules on both Windows and the Mac? To find out, I've been testing the new iWork, which runs only on the Mac, against the Mac version of Office.

My verdict: iWork '08 is a nice product, capable of turning out sophisticated and attractive word-processing, presentation and spreadsheet documents. It can even read Microsoft Office documents, whether created on the Mac or on Windows computers, and can save documents in Microsoft Office formats so they can be opened in Office on the Mac or on Windows.

But iWork simply isn't as powerful or versatile as Microsoft Office, especially when it comes to word processing and spreadsheets.

And it suffers from a design that places far more emphasis on making documents look beautiful than on the nuts and bolts of the actual process of writing and number-crunching.

There's one big omission in iWork: It has no integrated email, contacts and calendar module comparable to Outlook in Windows or to Entourage, the Outlook equivalent that's a part of the Mac version of Microsoft Office. Apple decided to rely on the very good email, calendar and address book programs that it builds into every Mac.

But iWork has one big plus: It's the first Mac office suite that can open (though not create) files in the new formats Microsoft introduced in the Windows version of Office earlier this year. The Mac version of Office won't do that until Office 2008 is out in January.

The new Numbers spreadsheet has some refreshing innovation that makes it far more approachable for casual spreadsheet users than Microsoft Excel often is. Numbers allows you to place multiple spreadsheet tables, plus charts and graphics, on a blank canvas that you can arrange any way you want.

Each of the spreadsheet tables functions like an Excel spreadsheet with individual cells able to hold numbers, text or formulas.

Numbers has some other nice features to make things simpler. Any cell meant to contain a value you type in can be controlled with a slider or up-and-down arrows, so you can rapidly see how different numeric values would alter calculations without a lot of retyping.

I also found that Numbers made it easier than Excel to sort columns, and to add or move columns and rows. It's also easier to create formulas using the actual names of columns and rows rather than their number/letter coordinates.

And Numbers lets you drag and drop common formulas, such as Sum and Average, to the bottom of a column of numbers.

For real spreadsheet jockeys, however, Numbers is wimpier than Excel. It has only about half as many functions for making calculations and doesn't do pivot tables.

The Pages program was originally more of a page-layout program than a writing tool. The new version attempts to fix this imbalance with a less artsy word-processing mode. But the effort is only partly successful. It still de-emphasises some writer-friendly features.

For instance, its auto-correct function is much weaker than Word's. Another example: In Word, to see how many words your document contains, you just glance at the bottom of the screen.

In Pages, you must dig down into a submenu to find the answer. The command for showing invisible formatting marks also is harder to find than in Word.

The strongest part of iWork is Keynote, the presentation program, which still makes it easier than Microsoft's orwerPoint does to make rich, beautiful slide shows.

The new version isn't a major overhaul, but it includes a new feature called Instant Alpha that makes it easy to eliminate unwanted backgrounds from photos.

In my tests, importing and exporting documents between iWork and Office worked fine for simple files. But fidelity isn't always perfect, especially in Numbers, where missing Excel functions or Numbers-only features don't carry over.

If you're a Mac user with basic word-processing and spreadsheet needs, and a strong emphasis on design, iWork is good choice, especially if perfect compatibility with Microsoft Office isn't a high priority.

But for office-suite users more concerned with function than form, I'd recommend sticking with Office.