Google Apps now directly competes with MS Office….Yeah right!

by ron on June 16, 2007

Google Apps vs MS OfficeGoogle have recently released a new product bundling called Google Apps.

It’s a product bundling which includes:

  • email via Gmail
  • calendaring via Google Calendar
  • instant messaging via Google Talk
  • online word processor
  • online spreadsheet
  • web page creator
  • simple web-based admin consoldes

Another important point is that Google allows you to run all of the above on a domain name of your own choice. So your email address would be something like joe@mydomain.com rather than joe@gmail.com

Here’s the tour of the features.

The internet has been buzzing with story after story saying what a great offering Google has just released, and that Microsoft should watch out.

Part of the reason this is being said is that Google Apps can be obtained for free (with a 2GB storage limit per email account), or just $50 per year per user for email accounts with a 10GB storage limit. Here’s a side by side comparison between the free and paid versions. In contrast, MS Office retails for US$352 for the Standard Edition through to US$595 for the Ultimate Edition.

Although Google Apps is cheap, you need to realise that all of the services above are already available from Google for free (with the exception of being able to use your own domain name). So this “new product” is not new at all, it’s simply a bundling of existing Google services. There’s also no apples-to-apples comparison to MS Office here at all. The number of features available in MS Office completely blows anything else out of the water. Now with Office 2007 many of these features are far more accessible to the average user (thanks to the new user interface), so if you want a best-of-breed solution for your business needs, then you won’t find a more powerful suite on the market.

The second issue is that of storing content online vs offline. Although small companies may be ok with storing their email online (Gmail, Yahoo Mail, etc), it is quite another thing to expect them to be ok with storing their intellectual property (documents and spreadsheets) online. How will you know if the online content is safe? Is it encrypted? (there’s no mention of this at all in the Google press releases) What if someone is able to hack into your online Google Apps account and get full access to your financial spreadsheets? Are Google employees having fun going through your private documents?

Thirdly, in relation to both of the two points above, let’s not forget that there’s plenty of competition for 3rd party products which are trying to steal some of the marketshare from MS Office.

Let’s start with a look at the offline competition, and we’ll them switch to online (web-based) competition.

There’s the excellent (and free) OpenOffice suite, which is an offline suite of tools which directly competes against MS Office. OpenOffice contains programs for: word processing, spreadsheet, presentations (Powerpoint competitor), graphical editor (Visio competitor), database, and a mathematical equation editor.

I’m sure there are other offline products out there that try to compete with MS Office, but OpenOffice is currently the number 1 player in this field.

Now let’s switch to online competition:

Feel free to browse through the above on your own, but make sure to check out Zoho and ThinkFree.
Zoho has some excellent features which I could go into, but I won’t in order to not turn this article into a book.

With all of this going on, do you think Microsoft are just sitting back twidling their thumbs? No, no, no….
Microsoft are jumping on the online services bandwagon and are now very serious about becoming an major player in this as well.
They can’t afford not to. MS Office revenue is a huge portion of their regular revenue.

Microsoft are doing various things in order to provide online services.

Firstly, there’s Office Live, offering free and paid services for your business. The free version gives you your own domain, web hosting, web site creator, 500 MB of storage space, 25 email accounts (with your own domain name), web site reports and advertising. Note that it is not an online offering of MS Office though.

Secondly, there’s Exchange Hosted Services, which offers online mailboxes, filtering, encryption, archiving and continuity services.

In summary, although I’m a big fan of Google’s search engine, Gmail, Reader, and Calendar, I don’t think that their Google Apps product bundling is anything to rave about. As you can see from above, there are already many other competitors offering much more functionality and many of them for free.

I think Google Apps is quite a decent product, but it is definitely not a direct competitor to MS Office. And even if it were, then it wouldn’t be the #1 competitor at the moment, since Zoho, ThinkFree and OpenOffice are more powerful solutions.

It’s going to be very interesting to see how Microsoft, Google, and the rest of the online competitors fight it out.


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