One reason is that it’s more convenient to use on computers you don’t own and can’t install software on, and other is you can share things with people without them needing to install it to view or edit your documents
OK, the first one I can understand. The second one... installing an open-source package that runs on almost everything doesn't seem like that big a deal.
But those are reasonable answers. I would rather see engineering effort go into fixing bugs in the suite, but I realize that the people volunteering to "Web-enable" the software aren't necessarily the ones who'd be fixing unrelated bugs.