I bought Keynote when it first came out, and it was immediately better than PowerPoint. However, the competition woke up some of the engineers at Microsoft and PowerPoint improved.
I was about to buy a copy of Office 2004 to get the updated PowerPoint when iWork came out, including Keynote 2.0. While still missing some of the nice features of PowerPoint, Keynote 2 is superior in many ways, and I like it a lot better, so I didn't buy Office 2004, I bought iWork instead. Pages 1.0 is an interesting looking application, but I still use Word.
What I'm hoping to see is iWork 2006: Keynote 3.0, Pages 2.0 and Numbers 1.0. Where Keynote fulfills it's destiny as the ultimate presentation software, Pages matures into a really usable app, and Numbers makes it's debut as a spreadsheet app designed with the user in mind.
That will put the heat on Microsoft to start fixing some of the more egregious bugs and user-hostile design paradigms in Office. So Apple will have a great Office-alternative (removing the one remaining threat Microsoft can hold over them), and Microsoft will be motivated to improve Office (after almost a decade of stagnation).
The big winners are obviously the users, who will have better software to choose from.