As Microsoft prepares to release Office 2010, it's facing unprecedented pressure. Unlike so many previous releases, Office 2010 is being challenged by a competitor that has the presence, respect, and perhaps most importantly, the cash, to take on Office and give it a legitimate fight.
The debate over when that fight will start is heated. Some say that Google has already started the battle against Microsoft, while others say that there is little chance of Google even being able to compete with Office for quite some time.
But the latter contention might be short-sighted. Google recently made public a list of why users, especially enterprise customers, should consider switching from Office to Google Docs. In that list, the company took aim at Office's pricing and how it utilizes servers to perform tasks companies can do for free on Google Docs.
It also examined the differences between Google's cloud efforts and those of Microsoft. The company made a compelling argument that could make some enterprise customers (and individuals) think twice about Office 2010. Meanwhile, Microsoft's additions to Office 2010 make it clear that the company is concerned about Google.
Simply put, the battle between Google Docs and Office 2010 is heating up.
Let's take a look at what Microsoft needs to do to stymie Google's growth and ensure that Office 2010 follows its predecessors in leading the office-productivity market.
1. Remember market share
The last thing Microsoft should do in its battle with Google is forget that it holds a dominating position in the office-productivity market. In fact, the latest tallies put Office at more than 90 percent market share in the space - much higher than anything Google has been able to muster up to this point. Because of that, Microsoft has a built-in advantage. It can use its market share to maintain control over the space and dictate what consumers want. After all, if they get comfortable with a feature that's already available in the software they're using, the onus is on Google to catch up. Being the dominant player is always a good thing.
2. Don't forget the Web
Google has been able to make some inroads in the productivity market because of its focus on Web services. Google Docs works extremely well and can be accessed from anywhere a person can find a Web connection. In the enterprise, Google Apps, which includes Gmail, Docs, and other key Google cloud tools, performs just as well. Microsoft is slowly but surely making its way to the Web with a new online Office tool and Azure, but it might not be enough. Microsoft needs to start transitioning some of its core businesses to the Web to ensure Google doesn't take an insurmountable lead.
3. Consider pricing changes
Office 2010 is expensive. That might not be anything new to the majority of Office owners that have paid the substantial sum in the past, but going forward, such high prices might not be good for Microsoft. Consider the fact that anyone can use Google Docs for free right now. Enterprise customers can use Google Apps, which includes Google Docs and several other enterprise-friendly features for just $50 per user per year. Microsoft's Office 2010 Professional costs a whopping $499. Microsoft would say that the premium it's charging is for the extra power users get with Office 2010. But whether or not all that extra power warrants such a high price tag could be called into question the more users realize Google Docs does some nice things for little or no fee.
4. The enterprise is the key to this
Microsoft's success has always relied on the enterprise. Without corporate help, Windows wouldn't be the success that it is today, Office wouldn't hold such dominating market share, and Microsoft itself wouldn't be so profitable. Going forward, Microsoft's success or failure will continue to rely on the enterprise. If Google can find a way to steal some company market share away from Microsoft, it will be cause for alarm. And unfortunately for Microsoft, it seems that Google is focusing some of its efforts there. Office 2010 needs to be Microsoft's tie to the enterprise; it can't be the reason companies have switched to something else.