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When you think e-mail servers and service, do you think POP/SMTP and MAPI? Or, do Sarbanes-Oxley and HIPPA come to mind? If you think of the former, youre thinking like a system administrator; if youre thinking of the latter, youre a CIO.
Google, with its purchase of software security company Postini, is trying to win the hearts and minds of technology friendly users and administrators this time. No, they want to open the wallets of midmarket and enterprise CIOs. And, you know what? Theyre going to get those checkbooks opening.
Gmail, while trailing far behind Yahoo! Mail and Windows Live Hotmail, is quickly picking up users since it finally opened the doors to anyone. Not long after that, Google announced Google Apps Premier Edition.
For those of you who dont know it, Google Apps Premier Edition is a hosted office suite. It combines a customizable start page with chat, e-mail, calendaring, word processing, a spreadsheet and a simple Web page builder into a package that Google sells for $50 per user per year. For that, you also get a 99.9 percent SLA (service-level agreement) for Gmail uptime, and 24/7 phone support.
At $50 per user, you can set up your office users at a price well below any Microsoft deal. The list price per user per year for Microsoft Exchange is $225 and Microsoft Office Professional Edition will run you $499. Of course, Google Apps Premier does not offer a PowerPoint clone. Yet. Google seems to have that in the works too in a skunkworks project code-named Presently. Besides all that, Googles applications can read and write the older Microsoft Office formats like .doc and .xls.
Thats all well and good, but simply matching Microsoft in features and beating them on price hasnt proven to be a winning combination in the past, or wed all be running OpenOffice.org for our office suite and Evolution for our e-mail client today.
By acquiring Postini, though, I think Google for the first time is mounting a deadly serious offensive against the Microsoft Office monopoly. Postini isnt just the largest hosted secure e-mail provider out there with more than a billion messages handled a day. E-mail hosting by itself is nothing. Whats important is that Postini offers services to encrypt and archive e-mail and instant messages. In short, theyre offering the kind of e-mail and IM services that CIOs not only want, but need.
As Richi Jennings, lead analyst of Ferris Researchs e-mail security practice, explained, Postinis anti-spam and anti-virus technology is at best a minor reason for Google buying Postini. Gmail and its Google Apps cousin already have sound spam filtering technology—they dont need help from Postini. What Google needed was a way to round out its Google Apps story with solutions for its customers policy, compliance and archiving/e-discovery needs, he said.
David Ferris, president of Ferris Research, added that the combination of Google and Postini “will help make Google Apps more attractive for SMBs and enterprises.”
Its not just HIPPA and SarbOx compliance software Google is buying; the Internet search king is also nailing down its online applications security
Dont take my word for it. Dr. Chenxi Wang, Forresters principal analyst for security thinks that Google is definitely looking to strengthen all angles for their enterprise apps.
“Enterprise customers typically have stringent demands on security, reliability, performance, etc. Google has the other operational aspects well covered with the exception of security,” Wang said.
Next Page: Trouble ahead for Microsoft.
Trouble Ahead for Microsoft
“I talked to Google today and they acknowledged that not having solid security offerings is somewhat of a road block for them in the enterprise market. Thats why they bought Greenborders and thats why they are acquiring Postini. Is this the right move for Google? Absolutely!”
Wang said that Postinis offering, billed as compliance and archiving/e-discovery, is primarily an “in the cloud” provider for anti-spam, anti-virus e-mail content filtering services, which also provides archiving and compliance-oriented content filtering.
“Google is buying Postinis secure e-mail services, first and foremost. They are not buying Postini for their compliance offerings, trust me. Secure e-mail services are a business necessity,” Wang said.
Its not just the IT analysts who are looking at this deal and seeing Google targeting the SMB and enterprise office markets. Citi Investment Research analyst, Mark Mahaney, liked the deal. He said that Googles play here is to use Google Apps to further penetrate the enterprise. Today, “Google Apps already has over 100,000 business customers [mostly small]. But to penetrate large enterprises, Google needs to add security, compliance, archiving and encryption functionality. Thats what the Postini acquisition provides,” Mahaney said.
It wont be as he puts it, a “near-term needle mover,” but … “with its third biggest acquisition to date [after DoubleClick and YouTube] Google is clearly positioning itself as an on-demand/software-as-a-service enterprise provider. We would expect more from Google in this sector going forward, including more acquisitions,” said Mahaney.
Taken as a whole this spells trouble for Microsoft, with its ever-changing Microsoft Live plans. In particular, Microsoft doesnt come close to matching Postinis offerings. Microsoft tried to get ahead of the curve in 2005 when it bought FrontBridge Technologies, and then relabeled it Microsoft Exchange Hosted Services, but that didnt work out as well as Microsoft hoped.
In a Gartner report that Microsoft itself had published on its Microsoft Exchange Hosted Services site, the company had this to say about its own offering: “Consequently, Microsoft clearly has the ability to execute and is poised for growth, but its current solution is overly complex and/or lacks key functionality common in competitors products.”
And, Postini? In the same report, Gartner analysts said: “Postini is a very technically astute service provider, preferring to build its own core anti-spam and data center technology. Its e-mail processing is differentiated by all-in-memory processing rather than the store-and-forward method of rivals. Investments in fundamental data center design have led to lower costs and better margins—as well as better adaptability—than rivals.
“Anti-spam capabilities are very good and include connection management via PTIN and value-added anti-virus capabilities with a 100 percent virus-free guarantee. From a product perspective, Postini has also invested in a number of recent ancillary services (encryption, archiving, IM hygiene, HTTP filtering) via a combination of native capability and the integration of numerous partner solutions. Postini provides better delegated administration capability for global and federated companies than rivals, and it has one of the best end-user capabilities in the market, including the ability for end users to set their own quarantine thresholds.”
According to Gartner, Postinis biggest problem was “a lack of international channel partners and data centers.” Somehow I dont think that will matter much anymore with Google as its owner. Do you?
I think its pretty darn simple. With Google being able to offer a quality office suite with Microsoft Office format compatibility at a cheaper price and with the kind of hard-to-manage e-mail/IM compliance technologies that SarbOx and HIPPA require, Google Apps Premier Edition is now the office suite for U.S. businesses. Its been a great run, Microsoft, but Office and Exchange are now officially in trouble.
eWEEK.com Senior Editor Steven J. Vaughan-Nichols has been using and writing about operating systems since the late 80s and thinks he may just have learned something about them along the way. He can be reached at [email protected].
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