Google, the world's leading search engine, is poised to take on the might of Microsoft Office 2007 and broaden its revenue beyond advertising. The company will be bundling the free web-based software offers into one premium package for sale to businesses.Google's product, which will include functions such as email, calendar, word processing, spreadsheet, instant messaging and VoIP programs is expected to be available soon. The announcement comes at a time when Microsoft is preparing to launch both Vista, the latest upgrade to the Microsoft operating system, and their Office 2007 suite.
Thousands of small and mid-size companies, along with several colleges and universities, already use a free version of Google's product - Google Apps for Your Domain - which was launched as a beta test version in August and is hosted entirely on Google's own servers.
The new premium suite offered by Google will be of particular interest to those businesses who are faced with the cost and disruption of upgrading their software - even though Google executives have yet to disclose details of what is to be added to make the premium package appealing to paying customers, when it will be launched or what the price of the suite is likely to be. Google is also selling customised search engines for businesses.
Google have stated that they do not see the introduction of their premium suite as a direct substitute for Microsoft Office or Outlook, and that their product will not be marketed in such a way as to appear so. Instead, the Google software will be offered as a set of tools to provide users more choice.
However, Google have acknowledged that their suite will represent a challenge to existing software suites already installed in workplaces around the world, and have hinted that their product has already generated a fair amount of interest. However, this interest has also been mixed with some caution, since Google hosts its software on its own servers rather than on those of its customers. This means that the search engine will be effectively outsourcing software that is crucial to the running of its business.
Nevertheless, this method could also free up valuable resources by removing the support and maintenance of basic software, ultimately allowing IT departments worldwide to concentrate on supporting much more business-specific software applications.
Microsoft currently dominates in the office productivity market, with more than 95 per cent of the market share. Kyle McNabb, principal analyst with Forrester Research in Cambridge, said that many companies would be "loath to introduce a foreign set of tools" to those employees already using Microsoft products at home and in the workplace, and predicted that the Google entry would gain at best one or two per cent of the market over the next two years.
However, some analysts believe the impending launch of Microsoft's new Office 2007 and Vista releases may well prove to be an opening for the Google product, since many businesses will be considering how best to upgrade their productivity software in the future.
