You might not be interested but I know folks in large enterprises that are stoked. This release has a zero cost impact to their business since more of them are migrating to or are already on Office 365. A lot of focus on AI is on a personal use case, whereas Microsoft's biggest customers are large enterprises. Those people aren't using iWork. Also, those free alternatives don't support Office as well as these do. Another thing...these apps look to be very well designed and developed. Credit should be given when due.
I'll again reiterate that I am not a Office 365 customer and these releases won't change that, but I can see how this is a huge deal for Apple.
As a small side note, Apple actually uses Microsoft Azure (name was recently changed from Windows Azure) and Siri even defaults to Bing for searches. For all the animosity towards Microsoft on these forums, Apple and Microsoft actually have a pretty solid working relationship. I don't really use Microsoft products but I am also not blind to the realities of the industry.