What MS Office Web means for enterprise IT shops

With Microsoft Corp. getting ready to bring its Office 2010 suite online to compete with Google Inc. and Zoho Corp., the focus now shifts to how the announcement will impact enterprise users.

In a recent study of 152 global IT decision makers, Forrester Research Inc. found that while 80 per cent of surveyed companies are using Microsoft Office as their prevalent productivity software, things might change in 2010. The struggling economy delayed Office 2007 upgrades, according to analyst Sheri McLeish, which will mean many organizations will skip straight to Office 2010 or look for low-cost alternatives.

McLeish said that because Microsoft already has a dominant position among enterprise IT shops, the release of a free Web-based Office suite stands to gain a lot of ground in the online office productivity tool market. But that alone will not guarantee its success in the enterprise.

“Part of the challenge for enterprises isn’t about whether to use Google or Microsoft, it’s to understand their workforce and what their actual needs are,” she said. “A lot of times they are stymied because they don’t know the features and functionality that their users need. They are challenged about supporting mixed environments and about not meeting the expectations of their end-users, leading to latency in adopting Web-based tools.”

Tim Hickernell, associate lead research analyst with Info-Tech Research Group Ltd., is confident Microsoft will be successful with the move and advised businesses to actually start looking at the free consumer-based Office for Web suite. He said an enterprise-focused cloud suite is surely in the works.

“Rather than a substitute product, we want businesses to look at this as an opportunity for hybrid implementation,” Hickernell said. “Much like organizations that are looking at the value proposition of virtual desktops, this is an alternative for those tied to desktops, because it allows for easier maintenance and support.”

He said that Microsoft’s entry to the cloud-based office productivity space should mean that businesses finally have the ability to integrate this type of functionality directly into their process automation applications, such as their CRM, ERP or content management technologies.

“The goal will be for people to avoid having to stop and go to another program in order to use basic productivity services,” he added.

While Google’s office productivity suite has been on the market for some time, McLeish said, enterprise adoption rates remain low because of its evolving and maturing nature.

“It’s represented a little bit of a risk for large organizations,” she said, adding that companies have also shown hesitation almost anytime their content leaves the firewall. “Plus, they already have commitments to Microsoft, licensing agreements in place, and a lot of legacy content.”

Tools from Google and ZoHo have always been considered by technology or research firms, but for organizations that have shown a hesitance to put content into the cloud, Google has responded with numerous use cases and references from successful clients, McLeish said.

But with Microsoft set to invade its territory, Google will have to focus on innovation, integration and collaboration to keep the business customers they have and attract new enterprise users.

“If Google can provide tools that support collaboration better and are able to match the features and functionality (of Office) at a much lower cost, it will make organizations take another look at them and how they negotiate with Microsoft,” she said.

“They also need to show their product roadmap and how it integrates with mail, Google Wave, and even their new operating system. How’s it going to be better, faster and easier for people to communicate, share information and get work done?”

Microsoft has worked on this issue at great length, McLeish added, with Open Office XML and its integration with the OpenDocument Format (ODF).

“This is really the key with these tools, to be able to make them easier for the end-user to use whatever application they happen to be using at the time,” she said.

According to McLeish, one strength that Google must take advantage of is its strong consumer recognition in search. Just as the Apple iPhone was able to penetrate some enterprises through employee demand, Google will hope for a similar trend to play out if it wants to remain relevant among business users.

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Jim Love, Chief Content Officer, IT World Canada

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