Does it blend? Zoho and Google

The announcement earlier today that Zoho has added an import capability for those using GoogleDocs to its Writer apps is great news. It is something I asked for a short while ago and is an excellent example of how an agile cloud computing vendor can respond to a need when everyone else is offering open APIs. Here are the steps Zoho recommends:

• Login to your Google Docs account & choose the documents that you need to export to Zoho
• Click on More actions -> Save as HTML (zipped) to your desktop
• In Zoho Writer, click on Import -> Import Google Docs, select the zipped file path and click Import
• All the Google Docs documents in the zip file will be imported into your Zoho Writer account & will be displayed in the left panel

As my erstwhile Irregular colleague Zoli Erdos says:

(the other update today is mass import from Google Docs: nice, special delivery for Dennis, but I still would like to see a list of all my online docs, be it Zoho or Google, open them, edit them, and save to whichever format (and storage) I want to.)

Dang - he's picky. But he's right.What is more important is that when viewed through the lens of emotional attachment, Zoho increasingly appears to be the company that will don Google's 'do no evil' mantle as a provider of 'stuff' that people not only want but which can provide genuine utility without requiring others to bend to the Zoho way.

Zoho already offers an export facility that accommodates a wide range of file formats. Why should that be important? Interoperability. There's no reason to lock people into different applications and in any reasonably sized collaborative group there is always the possibility that others will be happy with an existing application like Google Docs, OpenOffice or Word. All of which is goodness.

Another interesting question Zoli raised in riffing on Matt Asey's recent post on pricing models surrounds the question of commoditzation. Zoli notes that:

Yes, SaaS disrupts the traditional software market, but there’s another equally important trend happening: the commoditization of software.

Commoditization is beneficial to customers, but a death-spiral to (most) vendors.  Except for the few that drive commoditization.  Zoho makes no secret of doing exactly that.

The question then comes, where does the money come from that will fuel ongoing development of these new services? In an earlier piece, Matt says:

The general principle is always the same: focus on maximizing abundance, and then sell value around minimizing the complexity inherent in abundance.

The old model was to assume that the value was in the software itself and to therefore lock it up. It turns out, however, as Tim O'Reilly notes, that data is the real value, not bits and bytes. You don't discover or, rather, uncover, that value until you have abundance.

I disagree with this position because it implies a level of uncertainty that makes development very risky. It also assumes that value is extracted from a single source - the customer.

The problem comes when you try to do that for Office style applications. Google has already sewn up consumer based search as the delivery mechanism for advertising but I've yet to see anyone do that comprehensively for business. That's one model that could work. The service provider will need to get ToS right and find a way of encouraging users to use alternative search methods in the right context. That won't be easy, even if it is attractive.

More interesting is the use of aggregated data that can be sold on in anonymized form to third parties. I'm not convinced that works for word processed documents but I am much more comfortable with that idea for CRM and financial applications. Of course getting users to agree, and more important trust the service provider is a challenge all of its own that I believe needs to be baked in early to overcome later adoption hurdles. The business case for doing this is so compelling in my opinion that it is only a matter of time before developers latch onto its importance. I see a range of profitable possibilities that allow the user both freedom of choice while allowing the software developer to consider multiple revenue streams.