Is Google Apps now a real Microsoft Office competitor?

Is Google Apps now a real Microsoft Office competitor?

Summary: An alliance forged between Google and systems integrator CapGemini was the talk of the blogosphere on September 10. Many commentators are looking at the new partnership as proof that Google finally is ready to make business inroads with Google Apps Premier Edition -- mostly at Microsoft's expense. To me, there are some pieces that still don't quite add up.

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TOPICS: Microsoft, Apps, Google
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An alliance forged between Google and systems integrator CapGemini was the talk of the blogosphere on September 10. Many commentators are looking at the new partnership as proof that Google finally is ready to make business inroads with Google Apps Premier Edition (GAPE) -- mostly at Microsoft's expense.

To me, there are some pieces that still don't quite add up.

Price: How did CapGemini make its $10 billion in revenues in 2006? By charging for consulting, outsourcing and other related services. That's the business it is in. Google has been touting the $50 per user per year price point of GAPE as one of its main selling points. But once you add the fees for the services CapGemini provides -- procurement, installation, deployment, management and "disposal" -- that $50 will be just the tip of the iceberg in terms of what customers will pay for GAPE from CapGemini. Demand: CapGemini has signed up one customer for Google Apps Premier Edition (GAPE), according to a story in the UK Guardian. On Nick Carr's Rough Type blog, a CapGemini executive says it has signed up no customers, but is really close to finalizing a deal with an unnamed U.S. telecommunications firm. I'm sure there will be more enterprise users kicking the tires of GAPE. But when will these dabblers turn into switchers? And will they be willing to pay a premium for guaranteed 24X7 support and 99.9 percent guaranteed uptime for Gmail, among other enhancements?

Integration: Google continues to deny that it sees GAPE as a head-on competitor to Office. CapGemini execs also cite GAPE and Office as complementary, not competitive. I have yet to see anyone explain exactly how Google's own email, instant-messaging, spreadsheet, calendaring, word processing and other applications (all of which overlap with what Microsoft has) are complementary to Office. Is GAPE supposedly the "online" complement to the (mostly) offline Microsoft Office? What happens in shops where some of your customers are standardized on Office and others are standardized on GAPE?

Again, as I've said before: I would love to see Microsoft Office get some real competition. Competition would force Microsoft to be more responsive to user demands on features, pricing and more. Is GAPE -- in spite of Google and its partners' denials -- that head-to-head competitor? I still don't see it that way. Do you?

Topics: Microsoft, Apps, Google

About

Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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  • How to justify the investment.

    Google has decided to use (squander?) substantial resources on these applications. Perhaps the decision to do so was based on the effects on morale or a nouveau riche "I can afford it, I'll do it." exuberance.

    But now what?

    There will be greater reliance on the internet. Using it to augment existing software and adding convenience is a good sales point now. If the internet connection were to fail, the result is inconvenience, not disaster.

    People at Google are realistic to observe that the applications provided are neither sufficiently... elaborate nor reliable to become a major source of revenue. But the protests cannot be too loud, because people will some day look past the hope for a Microsoft competitor to all the investment expended on what could best be considered portal give-aways.

    And what of Microsoft Office?

    Just as there is such a thing as an acceptable price (what many/most will pay for functionality received), so there is acceptable performance.

    Office suites are a solved problem. Not many individuals or organizations are looking for an alternative, except perhaps when negotiating licensing fees.

    To have Office considered unacceptable, Microsoft would have to insist on a mistake with pricing or fail an implementation like Word Perfect on Windows. These seem unlikely.

    An alternative would have to provide better - more - functionality more easily to win a comparison. But which competitor has the resources for that? With an open source entry already holding a substantial part of the anti-Microsoft market, the company is protected from effective competition.

    The one company with the resources to create competition is IBM. And IBM is interested in the margins available in software. But OpenOffice seems to provide all the good with little of the investment.

    The single most effective step to be taken creating a competitor would be to abandon OpenOffice and make a standing offer to IBM to take over without IP problems, the project to become as proprietary as IBM chooses. If the company wants to provide an office suite as a sales point, let IBM pay for it. If that happens, IBM will go for a broader market to increase profits...

    Okay, but it is a speculation about how Office might have competition.
    Anton Philidor
    • wow Anton for once i agree with you

      Except on the buying of OOo by ibm ..... they should buy something else like Word perfect or that best Star office. make it compatible with the odf and with the rather large pocket of ibm this would rock.

      OOo should remain free and open to everyone out there a free office suite is important to permit the poor and underprivileged to have access to a office suite for free.
      Quebec-french
      • Star Office is joined to OpenOffice

        Sun is saving money by using OpenOffice code. Unfortunately, Sun is not profiting much from Star Office, so this would be one of the company's smaller losses to IBM.
        Anton Philidor
        • Sort of opposite

          "Sun is saving money by using OpenOffice code."

          Sun donated the Star Office code to OO. Sun bought Star from the German outfit that created it and then donated the code.
          j.m.galvin
          • True, but.

            The advantage to Sun was to benefit from subsequent work on OpenOffice without having to pay all of those who did the work.
            Anton Philidor
          • Who pays for OOo development?

            I think you'll find that Sun still pays for more of the OOo development than any other source.
            JDThompson
      • There are other free office suites.

        IBM should take over the one with which the company is most familiar. Should if Microsoft is to have a competitor, but won't because IBM is more grasping than interested in open markets.
        Anton Philidor
    • Well put...

      However, there is a need for a GOOD commercial package that is still compatible with Office formats for home/soho users that can't afford $500 software packages.

      Google Apps ain't it.

      IMHO, MS should remove the corporate features from Word, Excel and PowerPoint and package it as a replacement Home/Soho package for $99, maintaining file compatibility with Office 2007
      BitTwiddler
      • The Home/Student version is $150.

        It is a version of Office 2007, lacking Outlook, interestingly. The price will probably be reduced to $99 over time.

        So I'm not certain what you mean.

        This does show that different markets have different acceptable prices.
        Anton Philidor
    • speaking of ibm...

      have you had a chance to read this?

      http://www.openoffice.org/press/ibm_press_release.html

      gnu/linux...giving choice to the neX(11)t generation.
      Arm A. Geddon
      • I now see zdnet has a article on it.

        http://blogs.zdnet.com/open-source/?p=1401

        gnu/linux...giving choice to the neX(11)t generation.
        Arm A. Geddon
      • Poor Linux.

        Quoting the press release:

        "As an international team of volunteer and sponsored contributors, the OpenOffice.org community has created what is widely regarded as the most important open-source project in the world today."

        I think Linux is more important because it has a found a real market in erstwhile Unix servers. That generates real hardware/software profits.

        But the close connection to Sun means that OpenOffice.org must officially endorse penury, the moral superiority proven by money-losing quarters.
        Anton Philidor
        • Poor Anton

          He has wandered the halls of Microsoft turbulance until his mind has entered the realm of erstwhile oblivion.

          Anything is a Microsoft competitor. Microsoft has made it so, by competing with everything else. EVERYTHING must compete with Microsoft or be consumed or destroyed by Microsoft. It's a matter of survival, not competition.

          How do you stop a murderer? You murder him.
          Ole Man
    • If the internet connection were to fail, the result is inconvenience,

      not disaster, eh?

      That is, of course, if the user has not been mandated to connect to a Microsoft server to validate or reactivate his system to prevent it from being crippled.

      This is good advertisement for niether Microsoft or Google, to anyone who wants his/her own private files/data on his/her own desktop in his/her own office or home.

      Microsoft's "Cloud" is a bunch of gas, no matter what name it is given by anyone, or who copies it (like Google). Or is it Google that Microsoft is copying with their Cloud?
      Ole Man
    • IBM already has an office suite

      Lotus "SmartSuite:"

      http://www-306.ibm.com/software/lotus/products/smartsuite/

      Why would they need OpenOffice.org?
      JDThompson
      • What was the question again?

        Is Google apps now a real IBM office competitor?

        Why should anyone read the question before throwing the answer out there?
        Ole Man
  • answer is yes

    Does the corporate America id ready i don,t think so
    Is average Joe at home can get ride of its pirated version of office yes is average joe can make his average document on it yes.....


    But with all the money that Google have why don,t they buy Corel and there word perfect suite that would be nice a real MS killer
    Quebec-french
  • RE: Is Google Apps now a real Microsoft Office competitor?

    Well... yes I do fully agree with Mary Jo's comments

    "Again, as I???ve said before: I would love to see Microsoft Office get some real competition. Competition would force Microsoft to be more responsive to user demands on features, pricing and more...."

    And yes Google definitely has the capability of being this competitor and offering true value to the customers...

    But somehow I don't think CapGemini is the suitable partner!!!! of course time will tell (as it always does)

    Cheers

    Satha
    Chief Executive Officer
    SVA Global Pty Ltd
    m:+ 61 417 321 257
    e: satha@svaglobal.com
    w: www.satha-svaglobal.com
    Satha Arumanayagam
  • NEVER!

    How much do you trust Google? (Or any other outside party for that matter.)

    Do you seriously belive that (for example) drug makers would allow users to work with Google applications to document their research on new products where there could be billions of dollars involved?

    Think about it.

    Check out Google's privacy policies. Swiss cheese anyone? (All the government has to do is fart and Google will spill their guts.)

    Sorry, but NO web-based application operated by ANY third-party will EVER process any documents in any organization I work for. EVER.

    Having seen Capgemini's super-locked-down-security in practice -- I'll bet that Capgemini won't have people using Google Apps to process ANY of their documents. (OK, maybe the janitor filling in a timesheet.)

    (Or maybe Google has offered Capgemini access to data Google Apps have indexed -- are you sure they won't?)
    Marty R. Milette
  • RE: Is Google Apps now a real Microsoft Office competitor?

    myjcpd,good post!
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