When I introduced Diigo as an online annotation of web pages, some students asked me: “Can Diigo work on PDF or Word documents?”. Here is my answer: “Well….. to use Diigo on PDF or Word documents, first of all, you need to open the file using your browser. Sometimes it’s not easy since your browser will try to download the file instead of opening them directly.” I guess the point I want to make is that even if you manage to use Diigo on PDF files, it is probably not what Diigo is designed for and good at.
Crocodoc, instead, is designed for working with PDF or Word documents. It is actually very easy to use. You just upload a file on the website, then Crocodoc create a link for your document (like this example). There is no need to install the browser extension. You just upload the file and work on it.
You even don’t need to register for an account to use the service (As a matter of fact, only paid users need to log in.) There are two potential problems associated with the no-account situation: one is that you can’t make the document you uploaded private or password-protected. So anyone who know the URL can view the page. Second, there is no way to keep record of the files you uploaded and worked on. Then you are responsible for remembering or keeping record of the URLs. (My suggestion is to bookmark the URL using Diigo or delicious immediately after you upload the file on Crocodoc. )
The interface of Crocodoc is pretty simple and easy-to-use. Like Diigo, you can highlight texts and add sticky note anywhere you want on the document. You can highlight a single word or even a letter, which can not be done with Diigo. In addition to the sticky note feature, it also allows “Write in the margin”.

After you make highlights, you can click on the highlighted area to show the edit menu as shown below. You can delete the highlights, change colors, add a sticky note to the highlighted area, and copy the highlighted texts to the clipboard.

The collaboration process is very easy. You simply email other people the link and they can work on the article in the same way as you. But, since no log-in is needed, there is actually no way to tell who posted the notes.
I tested both PDF and Word documents and Crocodoc works well on both type of files. Give it a try! If you have any question or bump into problems, leave a comment here.