Expert raises questions about Google’s hosted apps for SMBs

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Google Inc.’s recently launched hosted applications for small- to medium-sized businesses (SMBs) appear to hit a “sweet spot”, but at least one Canadian analyst says this is not the time to switch to such tools.

The beta version of the browser-based service called Google Apps for Your Domain rolled out yesterday offers businesses access to four initial offerings namely:

Gmail for e-mail functions;

• Google Calendar for scheduling;

Google Talkfor Internet Protocol (IP) enabled phone service

• Google Page Creator for Web page design;

The intent is to allow companies and organizations access to collaboration applications, even if they can’t afford internal IT support or don’t want to devote IT resources to those tasks.

Businesses can sign up for the free version at this Web site.

However, one Canadian analyst says the quality of online collaborative apps may not be up to snuff.

“This might not be the right time to adopt online collaboration,” said David Senf, manager for enterprise applications at IDC Canada Inc. in Toronto.

Senf said this technology is still underdeveloped and “does not work well with desktop apps.”

He foresees the emergence of a blended environment where online and CD-based software are used in an organization.

“Perhaps in the next 18 – 24 months we might see a hybrid environment of hosted services and packaged applications,” Senf said.

Another analyst agrees. “This will be a great benefit for a lot of small Canadian companies, but I don’t see it replacing packaged software,” said Curtis Gittens, enterprise applications analyst at Info-Tech Research Group Inc., based in London, Ont.

Gittens said Google is offering businesses low cost core capabilities that allow them to write, schedule meetings, share documents, talk over the phone as well as design basic Web pages. “This is the sweet spot that Google is aiming for.”

The selling point of this offering is economy and ease of use, he said. “Companies will probably subscribe to Google Apps but keep their licensed software” said Gittens.

He noted that Google’s initial offering did not include word processing and spread sheet applications.

Gittens said the free version of the service will feature some advertisements while a premium version, available for a monthly fee, will be ad-free.

More applications will be added over time, according to Matthew Glotzbach, head of products for Google’s enterprise division.

He wouldn’t elaborate on what those applications might be, but Google’s online word processor and spreadsheet are likely to become part of the hosted collaboration suite.

Google isn’t publicly talking about who it sees as the competition either.

Senf said a possible competitor is Microsoft Live.Com .

He said IBM Corp.’s Notes collaboration software is a distant third in the race.

“We’re trying to take a new look at what it means to collaborate,” said Rajen Sheth, product manager, Google Apps for Your Domain. “There are obvious competitors out there, but I think people will see this as a fresh look.”

That look, while hosted by Google, will be accessed at the Internet domains of businesses, universities and organizations that sign up for it. All of the suite applications will have a user interface based on AJAX (Asynchronous JavaScript + XML) and be branded for individual organizations, with the same logos and color schemes used at the domain.

While the e-mail will be Gmail, it will remain a domain address.

Glotzback said Google aims to “really drive down cost and maintenance.”

The premium version will offer more support, as well as service level agreements and what he described as “richer integration” of applications with the domain. “We’re very serious about this space,” he said.

Just last month, Google also began to host open source software development projects in a move that has been met with mixed reaction from the developer community online.

Ever since the launch of Gmail, Google has collected feedback from SMBs and universities, in particular, about that application and has also been beta testing Gmail for Your Domain for quite some time. Google Apps for Your Domain is an extension of that, Glotzbach said.

Senf said enterprise businesses are not likely to be attracted to hosted services, though a big percentage of collaborative software adopters are big companies. He said control and development of the functionalities that fit a particular business is a key consideration.

Big businesses, he said, want to develop collaborative applications in-house. This gives them control over the apps as well as the range of capabilities to be deployed.

The IDC analyst said security is another major concern when it comes to online applications. “Of course the information will be encrypted and firewalls will be deployed but putting your data online opens up more points of vulnerability.”

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