Google Apps upgrade threatens Microsoft Office

IDG News Service - Google Inc. is pushing further into the communication and collaboration applications market with a major upgrade of Google Apps, a hosted suite for organizations of all sizes that analysts say could soon become a real competitor to Microsoft Office.

Google today introduced a Google Apps version that, for a fee, offers guaranteed uptime, IT management tools, technical support, increased e-mail storage and integration with the Docs & Spreadsheets word processing and spreadsheet applications, as well as BlackBerry support for Gmail.

With a cost of $50 per user per year, Google Apps Premier edition becomes the third and most sophisticated version of the suite, which was launched in August with the free Standard and Education editions. Like the original editions, Premier will have services like Gmail Web mail, Calendar shared scheduling and Talk instant messaging.

Until today, the suite was called Google Apps for Your Domain because organizations offer these Google hosted services using their own Internet domain and branding. The Standard edition is used by more than 100,000 small businesses, and the Education edition by hundreds of universities.

SF Bay Pediatrics, which has two medical offices in the San Francisco area, implemented the Premier edition in January for most of its 25 employees, which until then had used individual e-mail accounts from providers like AOL LLC. "We had no control over e-mail, and supporting it was a nightmare," said Andrew Johnson, the company's CIO. With Gmail, the performance and management e-mail problems disappeared, he said.

While SF Bay Pediatrics employees use Microsoft Corp.'s Office suite, they also use Docs & Spreadsheets to store their files on a central server and collaborate on them, Johnson said. "I don't see us going fully software-as-a-service yet, but maybe in the future," he said.

Indeed, Google Apps represents a new, hosted approach for productivity suites, a market ruled by Office, which is mostly desktop software. Despite security and privacy concerns over storing applications and data on a third-party data center, organizations are increasingly adopting hosted models, because the vendor stores applications on its own data center and thus frees IT departments from spending time and money on hardware and software maintenance.

Forrester Research Inc. isn't telling enterprises to drop Office, but it is recommending that CIOs give Google Apps a serious look, in large measure because Office's price is high, said analyst Erica Driver. Today, Google Apps is a cheaper alternative to the core Office applications, but eventually it could be a replacement option, as Google grows its capabilities and CIOs get more comfortable with software as a service, she said. "Microsoft