Google to Microsoft: Wolf in sheep's clothing?

Google to Microsoft: Wolf in sheep's clothing?

Summary: Google has a knack for launching (hoped for) category killer applications directly aimed at usurping existing market leaders’ positions via a reassuring “we’re not a competitive threat, we complement each other

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TOPICS: Google
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DMM82906W.jpgGoogle has a knack for launching (hoped for) category killer applications directly aimed at usurping existing market leaders’ positions with its reassuring “we’re not a competitive threat, we complement each other” mantra.

Matt Glotzbach, head of enterprise products at Google, on Google Apps for Your Domain vs. Microsoft Office:

The right way to view Writely and Google Spreadsheets, especially in the context of a larger business, isn't necessarily as a replacement for Word or Excel. They're the collaboration component of that.

On Google Checkout vs. eBay PayPal, Google CEO Eric Schmidt said days before its launch:

Very important to know that it is targeted at advertisers, not at general consumers….Not like PayPal at all.

Who does Google think it is kidding?

Upon Google Checkout’s release Google’s key advertiser account, eBay, prohibited Google Checkout as “Payment Services not permitted” on eBay.

Microsoft does not welcome Google Apps for Your Domain as a new, collaborative neighbor in the “cloud.” Ray Ozzie was recruited by Microsoft to “Webify everything.”

April’s Fortune piece “Microsoft’s new brain” cited Ozzie on his strategic mission:

To intertwine Microsoft's entire product line - software for consumers, software for businesses, Xboxes, all of it - with the vast and ever-growing power of the Net.

Also cited, Bill Gates and Steve Ballmer:

GATES fed up with Google being seen as the ‘thought leader’ of the Internet Age.

BALLMER We have the birthright to lead the pack. We've got more technology. We've got more experience.

Microsoft and Google complementing each other? Like the wolf complements the sheep.

Anil Dash’s “Google Apps doesn't compete with Microsoft Office” is thought provoking, but not convincing. Dash says “Feel free to poke someone in the eye if they say this version represents a competitor to Office.” Here goes, I hope my eyes are safe!

I will not parse the meaning of “this version,” but will debate the components of Dash’s argument.

Dash:

There are only 500 buyers of Office that Microsoft cares about…Those 500 buyers control hundreds of millions of dollars worth of Office revenues, and they're simply not going to use an ad-supported service that hosts their data on remote servers…Google Apps targets small businesses, where Microsoft doesn't generate nearly as much revenue due to passalong piracy.

Rebuttal:

Google is planning a premium, higher-performance paid offering which, presumably, would not include advertising. Moreover, while Fortune 500 CIO needs may influence Microsoft product development strategy, continuation of Microsoft’s worldwide ownership of the desktop PC still requires a perpetual consumer public relations strategy. Microsoft’s OEM distribution acquires customers; It is Microsoft consumer brand marketing, however, that enables consumer acceptance of its worldwide monopoly.

Microsoft Office Live presents a future opportunity for Microsoft to convert illegitimate, non-paying pirated users of its software applications to legitimate, non-paying ad-supported users of its software services. Perhaps we will see a Microsoft “Amnesty” program!

Dash:

Microsoft Office and Google Apps do different things.

Rebuttal:

The offerings do “different things,” for now. Both Google and Microsoft are working around the virtual clock on functionality to improve, enhance, add, overlap…

Dash:

System integrators have no incentive to recommend Google Apps…Given that Google's already offering payments for Pack, Picasa and AdSense as well, Apps is probably only a matter of time. But it's still unlikely any third party could make as much money recommending Apps as they do selling Microsoft Office services and the promise of an upsell to big-ticket items like Exchange servers.

Rebuttal:

Google famously, but non-transparently, dangles a “you’ll make more money with us then them” carrot to prospective AdSense publisher partners:

advertisers pay either when users click on ads, or when the advertiser's ad is shown on your site. You'll receive a portion of the amount paid for either activity on your website. Although we don't disclose the exact revenue share, our goal is to enable publishers to make as much or more than they could with other advertising networks. The best way to find out how much you'll earn is to sign up and start showing ads on your web pages. There's no cost, no obligation, and getting started is quick and easy.

Google Apps not competing with Microsoft Office? Google is certainly operating as if it is.

Aaron Ricadela reports:

Instead of trying to displace the hundreds of millions of copies of Office installed on business PCs, Google will try to snare users once they start sharing the Word and Excel files they've created… Google's plans include prompting people who send Microsoft Office documents using Gmail to translate those files into Google's formats for editing on Google.com…

Gmail messages that include attached files currently prompt users with links to download the documents or view them on the Web. Glotzbach envisions a third link to edit the documents online and generate E-mail to other users in a group when the edits are done. Writely can read files created by Microsoft Word, and Google Spreadsheets can read and create Excel files and formulas.

Glotzbach may be a wolf in sheep’s clothing when he puts forth that Writely and Google Spreadsheets aren’t "necessarily" replacements for Word or Excel. Not necessarily, but Google is doing all it can to ensure it.

ALSO SEE: Next Google Apps targets: Intuit QuickBooks, MS Money? and Google's not so fine print: Google Apps TOS put Google first

Topic: Google

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21 comments
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  • Like a slow moving freight train, Google Office is comming. The uptake will

    be slow but steady, with new features arriving monthly. Google will solve the offline problem for individuals and also for corporations. For corporations, they will put a server or rack of servers on site to solve both the offline problem, and also the desire to keep all documents in house and control them. For individuals, we need a mini webserver built into Firefox that can cache applications for offline use, then automatically sync files on reconnect.

    I am sure that there is a group inside of Google working 24 hours a day on adding a rich interactive web application api and libraries to Firefox, along with a mini webserver for offline use of rich interactive web applications. Google needs to move beyond AJAX eventually.

    Given that Microsoft can not fully embrace web applications without losing billions in revenue, there will be a lot of internal fights, and slow acceptance of the reality that the world is moving to the web.
    DonnieBoy
    • Are you going to use THAT for the next month.

      Given that DonnieBoy is clueless to the workings of Microsoft and Google, why does he continue to posts as though he works for both?
      John Zern
  • The Bell Tolls For Microsoft

    Today Google released a new service named Google Apps for Your Domain. Notice I didn't say software package. Reffering to this new service as a software package would be doing it a disservice.

    This is not merely a collection of free software/services that Google is offering. That in itself is pretty nice for small business owners. I owned a small company during the late 1980's through the late 1990's, and I would have loved not having to spend all the money I did on software packages, that were no more functional than what Google is offering now for free. What Google is offering business owners, is the chance to re-think the way they do business, at no financial cost.

    How nice would it be to buy "packaged" software, and then get your money back a month later when you discover it really doesn't meet your needs? If you're anything like me, you have a lot of software collecting dust, because it didn't do what you thought it would. Google is offering the chance to try a new business model for free, and if doesn't work, you can always go back to over paying Microsoft for average software.

    Every day the web-centric world moves a little further away from the desktop as we know it. Every day Microsoft pretends that they still are a player. Every day the true web players, distance themselves further from the desktop world. The bell tolls a little longer, a little louder, every day. I'm guessing Microsoft can hear the ringing in their ears.


    I?m Guessing
    http://imguessingblog.blogspot.com
    imguessingblog@gmail.com
    imguessing
    • did you cut and paste this from yesterday?

      The bell tolls for "imguessingblog.blogspot.com" it would appear.
      John Zern
  • Ray Ozzie joins Google.

    just kidding..!but I think it's a good idea.
    AnonymousBugMeNotUser
  • Microsoft Office Live presents a future opportunity...

    Have you signed up for MSOL? I did months ago and its Beta offering has not changed at all in that time. There is little, if any, overlap between MS Office and MS Office Live that I can other than calendars and email. It does provide storage for traditional Office documents but cannot open, edit or manipulate their content.

    Unless the site content became fixed when I signed up (meaning that MS has enhanced its service offerings and web app portfolio without updating my site), then I see no way at all that MSOL represents a "real" future opportunity. Quite frankly, I am quite dissappointed at the features and responsiveness of their Beta and am starting to doubt that its anything other than an attempt to gather mindshare without any real substance behind it.

    Sorry, but my assessment runs completely contrary to yours. If Google is actually providing document (word processing and spreadsheet) web apps, then they are way in front of MS on this.
    msolgeek
  • Do not ask for whom the bell tolls....

    The big question isn't "Who will win? Google or Microsoft? Linux or Microsoft? Apple or Microsoft?"
    Just as the big question in the late 80's wasn't "Who will win? Microsoft or IBM? Apple or IBM?"

    In the 80's Microsoft recognized that they weren't in competition with IBM. Apple didn't. Microsoft wasn't playing IBM's game. MS moved the game and left IBM and Apple in the dust.

    The question now is -- where's the next game?

    Some people think "Open Source" is the next big game. (I doubt it -- open source is a strategy you can use to play a game, but it's not, in itself, the new paradigm.)

    Some people think "Free Software" is the new game, but it's hard to make money with Free anything, and the one rule of the game that stays constant is that the most money wins. Charging for the support of "free software" has yet to really wow anyone as a business model. (since it's almost always cheaper for the big buys to hire their own support staff)

    Some people think "Ad Supported" is the new game. Ad's are great. Ask NBC or CBS about how well that model has stood up against pay-for-service models like cable and satellite.

    Some people think "The Living Room" is the new game. Sony and Apple seem to have bet heavily on this idea. But I don't know anybody who likes the idea of consolidating all their media, entertainment, and computing needs into a package from one vendor.

    Some people think "The Web" is the new game. Network, network, network. Thin-clients and services are the wave of the future. I think this ignores the steadily decreasing cost of local storage and local procesing power. whenever I hear the networked thin client pitch, I feel like I'm being told how great public transportation is -- except that everyone already owns a car.

    Some people think the new game is "2.0"; a mash-up of different data and... something that will be really great. It's is all so vague as to be meaningless.

    Some people are hedging their bets -- Microsoft has put moeny and time into each of these strategies, trying to make sure that it has a piece of whatever pie eventually comes out of the oven.

    So what is the new game? That's the multi-billion dollar question. I think it will be a combination of rich-client hardware and networked data. Software will be distributed via the web, but they will still be apps that run in a rich-client environment. Advertising will support the data network, but fees will drive content creation (software and media). Google is the farthest down this road right now -- but there's a long road ahead -- and Google is still too dependent on ad revenue (ad revenue is notoriously fickle -- again, talk to NBC or CBS or ABC). Google is also missing the rich-client component (adding extensions to Firefox is a step, but they'll need tighter integration with the desktop than Firefox gives them). Sony is in a position to help commodify hardware, but it's missing the software and network components. IBM and Linux could make some headway, but until they put serious focus on non-technical consumers, they'll stay in their niche.

    Microsoft has control over the rich-client user space right now, and is starting to make some headway in rich-client commodification (via the Xbox). They're also starting to play in the networked data space, but they're a ways back in that regard.

    Apple has great rich-client commodification, they're a strong player in the networked data space (via iTunes), they have a strong content relationship with Disney and Pixar that should help them expand in the network space... but they lack the rich-client user base that Microsoft enjoys...

    If any two of these companies decided to get together, the combination would likely be unbeatable... I think in particular, a Microsoft/Apple combination would be unstoppable. Merge them, take three upgrade cycles to unify the OS base, and in 10 years, they'd own the software and the hardware and the network.

    Just some random thoughts...
    pkstephens
  • Somebody talking about Google as the "wolf," and ...

    Microsoft as the "sheep" brings to mind a one word response ... not "Baaaaa" but Artie Lang's "Waaaaaaa!" :D
    OButterball
  • Google Office is not a solution. It is merely a set of virtual tools.

    Can a small business afford to give up the high-level of functionality and integration offered by Microsoft Office? If you tell your controller they can no longer merge AR letters with Dynamics, the sales manager they can't analyze CRM data using MapPoint and HR/Payroll the time clock data will need to be re-keyed, what do you think they will say?

    Google is NOT providing 'free' applications because they are a philanthropic organization. They have a plan to monetize any hosted application suite through advertising and mining the data for aggregate trend data. The first reason should be enough to keep any smart business person away. The second reason, in light of recent AOL privacy revelations, should be enough to make you run!

    Today?s small businesses are looking for solutions that help them compete more effectively in local as well as global markets. They can not afford to be hobbled by inferior applications that offer little more than virtualized versions of non-integrated 1980?s-vintage shareware.

    I look forward to the day when we can offer our clients hundreds; if not thousands of small business applications, designed to work together in a virtual cafeteria suite, with the same tight integration available in the networked Windows environment of today. Until then, we will continue to encourage companies that want virtual access to their systems to use solutions like Terminal Services and Go-To-My-PC, complimented with web-based collaboration tools like SharePoint and Groove.

    http://digitalpipedreams.blogspot.com
    John Westra
    • Most small businesses only need word processing and simple spread sheets.

      And, even in medium size and larger companies, only a handfull need the types of functionality you are talking about, NOT everybody. Probably 99% just need simple word processing and spread sheets. Yes, this will be a slow uptake, and yes, Google does not have all of the little tie-ins YET, but they will be adding them one at a time.

      And, you can bet, that the manufacturers that make time clocks and other things, will make it easy to integrate them with web services. No, not overnight. Also remember that employees can save spreadsheets and word processing files in MS Office format and that is all that is needed for some integration.
      DonnieBoy
      • You never answer the questions on where you get

        your "99%" number. I'm figuring more along the lines that 96% of small businesses need more then a simple word processor and speadsheet, so only about 4 perecnt would need this offering.

        and I would also figure that 72% of those businesses don't have a high end internet connection needed to allow multiple users to access information via the web in this manner
        (they have low cost DSL) If they did, then the cost of that alone each month would be more then buying a handfull of copies of Microsoft Office.

        Though I would also beleive that those 4 percent would go use OpenOffice before they would turn to this.

        Just another Google "Got to get something out there before the wave crests" application...
        John Zern
  • Indeedy: in the ANTI-universe, MS is the sheep and other the wolves :-) ...

    niet
    michael_t
  • Another comment on google office

    I have posted my opinion on the Google office launch here:
    http://www.centernetworks.com/google-opens-an-office-can-it-beat-microsoft

    And my biggest question is whether Google can reach the large corporate sector. I am certain they will take a chunk of the other sectors I write about.
    centernetworks
  • Parallel world

    Or maybe bizarro world. The Mickey Mouse apps you are talking about make Google a Sheep in Wolf's clothing - the media hype provides their clothing.
    TonyMcS
  • Donnie beats record for false statements

    NT
    TonyMcS
    • But have you seen his new "catch phrase" for September

      "Like a slow moving freight train"

      He's used it like 4 or 5 times already. I guess he heard it someplace else and liked it, so that will be his catch phrase for the month of September...
      John Zern
  • More like Sheep in Solfs clothing

    You must be kidding! Google is the archtypical "one trick pony"
    In later years folk will be saying "Do you remember Google?" It just seems unbelievable they can blow all those bucks, nevertheless thay have and will continue to do so.
    timpatco
  • Google and the Emperor's New Clothes

    The Google frenzy going on these days reminds me of the Dot-Com craze when everyone was pouring millions of dollars into the next "big thing". As we know, the Dot-Com bubble burst, companies went belly up, people lost jobs and a lot of money, and the bigger companies quietly disengaged themselves from the silly mania that had taken over the business world. All the blah, blah over Google is no different than the silliness of the '90s. What has Google done? Where is the amazing new software? Where is the revolutionary new applications? Google's output is the same old crap - and not even good crap. What are all the "cream of the crop" eggheads over at Google doing? Does anyone really work there besides a PR department? Sooner or later, people will realize Google has nothing new and isn't going to have anything new. All the hype over Google is just that, hype. Then watch their stock price nose dive. It will happen - as soon as people wake up and realize the Emperor isn't wearing anything - at all.
    jpr75_z
    • You Kidding?

      After Billy and Stevie have been running around naked for years, you think anybody will really notice Google not having any clothes on?
      Ole Man
  • System integrators

    You lost me on the System Integrators point. I don't see a correlation between Dash's point and your rebuttal.

    Dell doesn't have incentive to bundle GAYD when they make money selling Office. Dell won't make more through ads on GAYD than on Office sales. They would actually lose money.
    glocks out