Google Apps Turns 3 as It Fends Off Microsoft, IBM in the Cloud

Google finds itself in a daunting position on Feb. 22, the third birthday of Google Apps Premier Edition. The company is trying to dislodge legacy on-premises installations from Microsoft and IBM while fighting off SAAS solutions from those same companies. It also has to compete with new cloud offerings from Cisco Systems, as well as from a slew of startups such as Zoho, MindTouch and others. But Google, Microsoft and IBM will be the main protagonists in the battle for pre-eminence in the market for cloud, or Web-based, collaboration software.

When Google launched its Google Apps Premier Edition to the market three years ago, it marked a bold bet on the future of collaboration software.

The collaboration software market was, and still is, ruled by Microsoft and IBM, which boast more than 650 million customers for their respective Microsoft Office, SharePoint and IBM Lotus suite combined. Microsoft and IBM also license these suites as "on-premises" software that customers install and maintain on their own servers.

Google's launch ofGAPE was a departure from this on-premises model, offering collaboration software hosted on Google's servers and delivered via the Web in a method that has become known as cloud computing.

It was Google's stated intention to make money from GAPE. Until the introduction of GAPE, Google Apps was available in a free standard edition that included Gmail, Google Docs word processing, spreadsheet and presentation software.

However, for $50 per user per year, companies could offer their knowledge workers GAPE, which included those apps plus additional storage, security and, perhaps most importantly, 24/7 support.

Google Apps, which now has more than two million business customers, ranging from one-man shops to large companies, is designed to appeal to small companies that need low-cost collaboration software but don't have the resources to manage it, as well as to larger enterprises that want to eliminate the expense of managing collaboration applications themselves. This new cloud approach was something neither Microsoft nor IBM were aggressively pursuing at the time.

But by 2009, both Microsoft and IBM had released hosted collaboration solutions to keep Google Apps from being the lone wolf in cloud collaboration. Microsoft's Business Productivity Office Suite and IBM's LotusLive mark those companies' serious forays into the cloud.

Google finds itself in a daunting position on Monday, Feb. 22, the third birthday of GAPE. The company is trying to dislodge legacy on-premises installations from Microsoft and IBM while fighting off SAAS (software-as-a-service) solutions from those same companies, as well as new cloud offerings from Cisco Systems and from a slew of startups such as Zoho, Mindtouch and others.

Google Enterprise President Dave Girouard said that while Google spent 2007 and 2008 arguing the benefits of the cloud, Microsoft and IBM helped validate the market with their products.

"We now have all major competitors in our industry in full agreement that the cloud is worth going to," Girouard said. "We view this as a good thing. If you have all of the major vendors suggesting you look at the cloud, the consideration of our solutions is going to rise dramatically."

Girouard, who promised big things for Google Apps in 2010, said Google believes it is the only "fluent, native speaker in the cloud" and that Microsoft and IBM came into its jungle. "We think we're several years ahead of any of them."

Customers who voted with their wallets, such as the city of Los Angeles, Capgemini and Genentech, would seem to agree with Girouard. For example, Brent Hoag, director of IT for cleaning product company JohnsonDiversey, said he shuttled 12,000 employees to Google Apps from IBM Lotus Notes and Microsoft Outlook because of insufficient storage capabilities.

"They're constantly archiving and getting messages that they can't send or receive e-mail anymore because they filled up their mailbox after three big attachments," Hoag said. Lotus Notes and Outlook were also slow, he found. Hoag said he was able to port JohnsonDiversey e-mail users spread across 70 countries over to Google Apps in 48 hours.

Canadian hotel company Delta Hotels and Resorts migrated 8,000 employees from 44 locations to Google Apps. Subash Raman, project lead for digital innovation at Delta, said he moved workers to Google Apps from Exchange because of storage limitations and costs. Where Microsoft offers storage inbox loads in the megabytes, GAPE offers 25 gigabytes per inbox for each worker.

"It cost a lot to upgrade your storage," Raman said of Exchange. Moreover, he said, "you had to build a lot of folders to keep your conversations together and it took a lot of time to organize it. ... The new solutions are trying to do all of those things, but Google does it better."