Business Week has an article today about Google Apps. The suite looks more complete every day. Witness the Postini acquisition, the anticipated release of presentations (a combination of Zenter, Tonic Systems and probably some homegrown mojo too) this summer, the integration of JotSpot features and now, enterprise YouTube.
This one jumped off the page for me because it’s another compelling new web feature that Microsoft Office does not have today, wikis via JotSpot being another. I expect Blogger and Analytics eventually will join the suite with enterprise flavors too, making it very 2.0 and extremely collaborative.
Business Week points out that revenue from the Apps suite was only $40 million last year, so small that Google doesn’t even break it out in quarterly earnings statements. Eric Schmidt has called the enterprise a backup plan, just in case ads don’t sustain them forever. I’ve said before I think this is coy.
The fact of the matter is that Google doesn’t want to pick a fight with Microsoft overtly. Office is a $16 billion franchise, and Microsoft will defend it with vigor. So why would Google want to antagonize Redmond? Why not build the brand virally through small companies, non-profits and universities first? Act like it’s not a competitive product, for now.
The way into the large companies is through departmental adoption. Grow the feature set, extend the reach and then become the de facto solution for an enterprise, essentially forcing the CIO to standardize. Google has proven this model with the Mini, a cheap, easy, black-box solution for enterprise search. Analysts covering enterprise search say that Google appears in the conversations they have with CIOs because Minis (and to a lesser extent Search Appliances) have popped up all over their companies as departmental search solutions.
Google Apps will grow the same way. Why? Because they have features every user needs and offer new web features that Office does not.
- Real collaboration: No more version control or change tracking necessary, co-editing in real-time is possible.
- Portability: Your stuff on any computer, no more toting files on a thumb drive or emailing them to yourself.
- Live data: Documented here, Google Spreadsheets has formulas that can pull data from Google, e.g. revenue, population, people, etc.
- New web features: Wikis, video publishing, sharing/commenting/rating content are all applicable to the enterprise.
You can export your files to pdf and Office formats too, but you can’t easily bring them back into Google effectively, yet. You also can’t work offline, yet; I’m sure Google Gears will soon add offline capabilities to the Google Apps suite.
Google Apps has a long way to go to match the functionality of Office, but does anyone really doubt that this will happen soon, maybe by this time next year? I think $625 million in cash for Postini says it all. We in enterprise software should all pay attention because as I’ve said before, productivity apps are just the beginning for the Google Enterprise machine.
Enterprise isn’t a backup plan. It’s not even Plan B. It’s Plan A.1.