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So you have users editing Office documents and committing changes to SVN and you don't get conflicts? Or if you do, they are able to resolve them?

Yes you do get and can resolve the conflicts.

Despite common knowledge you can diff and merge office documents with TortoiseSVN. All it does is fire up their built in review/diff tools.

For normal office workers, this contraption really works better than collaboration (and change tracking if you need it) via Google Docs? Wow.