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For Google Apps, 2008 may be the year it realizes less is not more

Only 'several thousand' firms today ponying up for $50-per-user annual subscription

By Eric Lai
December 26, 2007 12:00 PM ET

Computerworld - The elegant minimalism of Google Inc.'s search engine is a huge reason for its unparalleled popularity.

But that approach has yet to pay the same dividends for its other Web-based services, especially its online productivity suite, Google Apps.

According to a spokesman, Google Apps has "millions of active users" of its services, which include the three Microsoft Office-like applications of Google Docs -- a word processor, spreadsheet app and presentation package -- along with Gmail, Google Calendar and Google Talk instant messaging.

But the vast majority of those users are using Google Apps for free, via a university or small-business account. According to Google, thousands of schools and half a million businesses have signed up for a free standard account.

Only several thousand organizations have signed up for Google Apps Premier, which costs $50 per user per year.

Apps Premier offers 25GB of e-mail storage per user (vs. 6GB for nonpaying users), a guarantee of 99.9% e-mail uptime, e-mail archiving and security features through its acquisition of Postini, and administration and support features for IT managers.

Only 2.3% of Americans regularly use Google Docs or Apps, according to a recent U.S. survey by NPD Group Inc., with less than 0.5% using them to replace Microsoft Office.

Launched 10 months ago, Google Apps hasn't had much time to steal many of the 500 million global Office users claimed by Microsoft.

But analysts and even paying users say Google Apps needs to be beefed up with features, some already standard to Microsoft Office, if it wants to make inroads, especially into the enterprise.

Google Apps "lacks some fundamental security and enterprise capabilities," said Rob Koplowitz, an analyst at Forrester Research Inc. "I don't know of any business that has made the decision to standardize on Google Apps."

Side dish, not sustenance

"If we deploy it correctly, Google Docs can replace some our Office apps -- but not all of them," said Les Sease, IT director of Prudential Carolina Real Estate in North Charleston, South Carolina.

Prudential has acquired Premier licenses and deployed Gmail for all 1,200 of its office employees and real estate agents. But fewer than 200 are using Google Docs, with an even smaller number using it to replace Office.

Sease would like to switch everyone over completely to Google Apps. But first he would like to see better synchronization between Google Apps and mobile devices, shared online file storage similar to that of Apple Inc.'s .Mac, as well as a simple desktop publishing tool similar to Microsoft Publisher.

For Vance & Hines Motorsports, a Brownsburg, Ind.-based motorcycle shop affiliated with the professional National Hot Rod Association team of the same name, it's Google Spreadsheets' restriction on spreadsheet size and its lack of advanced number-crunching features that is keeping the 42-person firm from completing a migration off of Office, according to Vice President Paul Langley.



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