Will government gig put Google ahead of Microsoft in cloud race?

Deal to bring services to federal agencies could give a boost to the cloud

With Google Inc. set to bring Google Apps to government agencies next year, analysts say it's a move that could put Google a step ahead of rival Microsoft and give the cloud a boost at the same time.

Google announced today at the NASA Ames Research Center in Moffett Field, Calif., that it's tailoring cloud computing services for agencies within the U.S. government. That means, for instance, that an agency can get its hands on the Web-based Google Apps that meet regulatory requirements.

With a customer as large as the U.S. government, this is a coup for Google, which has been trying to push Google Apps adoption in the enterprise. Having major government agencies willing to depend on Google for Web-based applications is quite an advertisement for the company's wares.

"It helps validate Google Apps," said Ezra Gottheil, an analyst at Technology Business Research Inc. "It says that most people don't need the power of Word, Excel or PowerPoint, and the virtues of secure, reliable data access from anywhere, and the ability to collaborate on single files, makes Google Apps a worthy replacement for Office."

He also noted that with rival Microsoft -- and all of its money, industry clout and dominance in the desktop application market -- looking to do something with Web-based applications, this is a good time for Google to make a push into the enterprise.

"If Google can get the government to standardize on a professional version of Gmail, that would be very big," added Gottheil.

Dan Olds, an analyst at Gabriel Consulting Group Inc., said that when it comes to office-oriented applications, Google should grab every advantage it can, because battling Microsoft in this arena won't be easy.

"With this deal, Google may have stolen a step on Microsoft as they begin the process of rolling out Microsoft desktop applications as a service," said Olds. "However, this won't give [Google] a huge advantage, since Microsoft has such a dominant lead in desktop applications."

But will Google be able to work the same magic on the cloud that it worked with search?

Analysts agree that Google's push into cloud computing certainly will renew attention on that option and probably get large customers to take a closer look at it. But Google will face some strong competition -- and it will have to deal with lingering questions about using the cloud in the enterprise, especially involving security.

"There are still a lot of good reasons for businesses not to use cloud computing," said Olds. "Questions about security, availability, reliability and being locked into a single cloud provider are just a few of the factors that businesses need to consider when thinking about how clouds might fit into their organizations."

He added that while Google certainly has the size, name and resources to be a big cloud player, it's bumping up against a host of competitors already in the market.

"So it's not going to be an easy fight, by any means," said Olds. "Everyone in the industry is heading towards this opportunity as fast as their PowerPoint presentations can take them. Google kind of snuck up on the industry by being a pioneer who got search right sooner than everyone else and capitalized on it. They aren't sneaking up on anyone in the cloud."

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