Google Docs is expected to get an update and name change. Under its new name, Google Drive, it will host programs you're already used to (word processing, spreadsheets, slideshows). There will also be an added storage feature, which will sync files across platforms like from your phone to your laptop. Wait a minute, that sounds a lot like Dropbox. Sure does. But that's Google's way of late: find a product that works, maybe try to acquire that company, if that isn't in the cards just make your own. It's the old Microsoft playbook. It's also the kind of reasoning that makes antitrust arguments that much louder.
Expect Google Drive to reside at drive.google.com (not live yet). It's not clear how docs.google.com (the current home of Docs) will be used -- perhaps as the home of the word processor app or maybe it will just redirect. Also not clear is how Google will allocate storage for this service, but presumably it will be the same as they currently do for Docs/Gmail/etc. You get a certain (ever-increasing) amount for free, and if you need more, you can buy it.