Google’s online software play is no threat to Microsoft, IBM – IT insiders say

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Information technology insiders say Google Inc.’s recent move to sell by subscription an online suite of office software should not worry industry leaders Microsoft and IBM.

The director of an organization of Canadian IT professionals also said the search company’s software play “puzzles” him given that Google’s offering appears to pale in comparison with current products in the market.

“Don’t get me wrong, I love Google products. But I find this play very puzzling,” said Adam Cole, national director for the Canadian Information Processing Society (CIPS).

“I wonder what they have up their sleeves,” he said.

Last week the Mountain View, Calif-based company announced it was charging $58 a year, per user for its new combo of software that includes e-mail, Web-based word processing, spreadsheets and calendar management. The product, Google Apps Premier Edition, builds on a free software package released by Google last summer.

The fee-based version includes 24/7 online, the option to turn off Web advertisements and10 gigabytes of e-mail storage per user. The software also enables Internet phone calls and Google will be adding mobile access to e-mail accounts through BlackBerry devices.

Cole, who said he will be using the free version to create CIPS’s new Web site, thinks Google Apps Premier Edition offers very little value to enterprise users. “The software doesn’t have the advanced formatting features, style sheets, embedding capabilities and database linking features you’d expect from an enterprise application.”

“The suite does not leverage any of the outstanding products that Google already has,” he added.

An enterprise software analyst also expressed doubt the new entrant will supplant Microsoft’s Office and the new Vista operating system, or IBM’s Lotus suite.

“It’s not going to drive companies to rip and replace the Microsoft products anytime soon,” said Joel Martin, vice president, enterprise software, for IDC Canada Ltd. in Toronto.

Martin said far from “trying to mimic Microsoft, Google is attempting to establish a market niche in the hosted application space.”

Microsoft is confident that it will maintain its dominance in the office suite space largely due to two key advantages.

“More than 450 million people around the world use our products because we enable productivity and provide an extensive support and developer base,” according to Mark Relph, vice-president, developer and platform evangelism group for Microsoft Canada.

With regards to Google’s online fee-based distribution model, Relph said, “other companies have been offering hosted Microsoft Exchange and SharePoint for some time now.”

“Google’s not the only game in town.”

A top ranking representative for the company meanwhile dismissed reports that it was going head-to-head against the office software industry leaders.

“Our goal is not to duplicate Microsoft. The focus is to build better collaboration tools,” according to Rajen Sheth, product manager for Google.

For instance, he said, the product’s spreadsheet application enables multiple users to make edits on the same document and view those changes simultaneously.

The suite’s calendar also enables users to share entries, updates and alerts within an office group as well as with outside partners and clients.

Sheth said Google also takes a different approach to e-mail as a collaborative tool. “Other developers move away from e-mail when creating collaborative tools, we realize though that e-mail is essential to day-to-day corporate communication.”

He said Google’s solution was to improve e-mail by providing better search features, enabling group conversation, beefing up security and allowing users to easily move in and out of the suite’s various services. The new software is also capable of creating what Sheth called “Chinese walls” that enables users to restrict access to e-mail groups.

Sheth said Google is also including access to the software’s application program interface (API) to allow developers to take control of the application and tweak it to suit their business needs.

He said numerous companies are already trying the product including international conglomerates General Electric Co. and Proctor and Gamble.

Martin of IDC Canada said while Google’s move is “disruptive” he doubts that people who bought machines with pre-installed operating systems or corporations that have invested heavily on Microsoft products would consider the software as an enticing replacement.

He said the product would be useful to those who want to work from home but can’t access the office system, or who want to read, write and respond to e-mail on their BlackBerry.

“The software will also appeal to users of workstations or home computers with limited memory and could be ideal for such projects as the US$100 laptop,” Martin added.

Google’s offering, Martin said, also spreads awareness among large enterprises that online software could be a viable alternative to the traditional boxed application. “Those using Windows-based products are more likely, however, to try out Office Live rather than Google Apps.”

“But it’s too early to tell. We’ll see how it grows,” he said.

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