How Zoho plans to compete with Google

It's a brave company that tries to go head-to-head with Google, the Internet's most formidable presence. But that's where Zoho finds itself, as it battles for mind and market share for its online suite of office applications.

While Google focuses on simplicity and ease of use, Zoho's strategy is to entice users with ever more stuff. "We believe businesses want more features," Zoho's Raju Vegesna told me during a visit to Computerworld's office this morning.

There are already more than a dozen free Zoho apps: word processor, spreadsheet, presentation, wiki, organizer, database, planner, online meetings and more. And none carry advertisements.

In contrast, Google's office productivity tools, while elegant, only sport word processor, spreadsheet and presentation software.

The Google user interfaces are intuitive and simple. For basic to mid-level users, they're a nice option. However, they don't have some of the functionality of desktop versions, such as spreadsheet macros (Excel-compatible macros are in the works at Zoho). And the lack of a database is a major drawback for many power users.

If you've never taken a look at Zoho's online suite, I suggest you give it a whirl. I'm a particular fan of Zoho Creator, the online database tool with an easy drag-and-drop interface for creating data input forms and data views.

Data structure and viewing options can't compare with a full-fledged MySQL or Microsoft Access application, but I've literally set up databases I can share with colleagues in just a few minutes. And, a relatively new developer API for Creator opens up additional options if you want to code an interface in Perl, PHP or Ruby instead of Zoho's homegrown Deluge scripting language. The API will be extended to other Zoho apps.

Zoho doesn't charge for most of its applications - exceptions are Zoho Projects (project management, a Basecamp competitor) and Zoho CRM (taking on another major powerhouse, Salesforce.com, which seems worried enough about the upstart to have purchased a top ad on Google anytime someone searches for Zoho).

Currently, Zoho has about 600,000 users (probably fewer than used Google while I was typing this sentence), with only 10,000 or so as paying customers.

I couldn't help wondering who or what is footing the bill for this rather robust online offering. Costs include about 200 developers (based in India), 600 or so servers in two data centers (a new one comes online every 2 days, Vegesna says), and a new disaster recovery site about to open in New Jersey (a secondary East Coast data center already keeps data backups but can't come online to keep the applications running if the main Sunnyvale, Calif. center goes down).

It turns out that profitable parent AdventNet is funding the Zoho infrastructure and personnel costs.

Zoho execs believe free personal versions will eventually lead to demand to use the apps in a corporate setting. He says they're already hearing from corporate IT departments that want some control over the Zoho use cropping up among employees. That's the idea behind Zoho Business, now in free public beta, which will carry a pricetag sometime later this year.

But there's no rush to start charging, he says, until Zoho execs are satisfied bugs are worked out and there's an appropriate level of features.

The goal at Zoho is to have a technical enhancement a week, according to Vegesna. This sometimes means that features outpace efforts to document them, although customer support is generally unusually responsive (especially for a free service) if you've got questions.

In the works: Office 2007 format support for Writer, pivot tables as well as Excel-compatible macro support for Sheet, and department-specific applications such as Zoho People (HR management) and Zoho Invoice.

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