Google Offering Free Apps for Work to Some Customers

20 Oct 2015 | Author: | No comments yet »

Google Goes After Microsoft And IBM By Making Google Apps For Work Free While Customers Still Under Competitor’s Contract.

The Mountain View, Calif., company is offering businesses free use of Google’s suite of word processing, email and other productivity applications for the life of the business’ existing contract with another provider.SAN FRANCISCO — Google is escalating an attack on Microsoft’s lucrative Office software in an attempt to hit its longtime rival where it will hurt the most.Case in point: Google is now so hell-bent on attracting new Google Apps customers, it’s offering to cover the costs of outstanding enterprise agreements companies may have with other enterprise software companies like Microsoft. It’s the latest salvo in a yearslong battle between Google and Microsoft in the highly profitable business of building software tools for office workers.

Google Apps includes Gmail, Hangouts for voice and video calls (single or group), Calendar, Drive for cloud storage, Docs for word processing, Sheets for spreadsheets, Forms, Slides for presentations and a web site builder. The company says that it will give interested customers access to Google Apps for Work for free, while they’re still under an enterprise agreement (EA) with another provider. Microsoft, with the Office suite it cobbled together over three decades, dominated sales of office-worker software when Google began making inroads in the late 2000s with its own Web-based email and document tools. The price for the ”Google for Work” software will be waived for the duration of the defecting customers’ existing contracts with Microsoft or any other supplier.

While Google didn’t call out Microsoft or IBM by name when making the announcement, it’s well understood that these are the top competitors for its Google Apps productivity suite and related tools. And it says it will chip in on some of the deployment costs following the earlier contract’s expiration, by also connecting the new customer with a Google for Work Partner. Google will also pay $25 per user to help defray the cost of switching software providers. “We’ve been working on being enterprise-ready for the last decade,” Rao said. “We’re at the point where we’re not only ready, but better for companies. Google’s announcement comes just weeks after Microsoft shipped its live collaboration-friendly Office 2016 productivity suite, which includes a number of workgroup tools, like group video (Skype for Business), simultaneous editing and continuous online app updates — all of which would look familiar to any regular Google Apps user.

Data from Okta, a San Francisco company that manages office workers’ logins to Internet services, showed Google’s Apps leading among its corporate customers until a surge late last year made Office 365 the most popular productivity tool among its customers. In the blog post announcement, Google contends it’s dealt with most of that. “We’ve made it easy by covering most of the features some claim to be missing and adding nifty new stuff like Voice Typing and Explore.

However, it’s unclear what portion of that gain came as businesses switched from Google to Microsoft, rather than desktop Office customers signing up for the Web variant for the first time. Google’s aggressive grab for Microsoft and other enterprise productivity business is less surprising when you consider how former enemies like Apple and IBM have gotten in bed together to go after large-scale vertical industries like travel and construction with industry-specific mobile apps. The offer underscores Google’s confidence in the quality of its software and its resolve to undercut one of Microsoft’s most valuable franchises, said Aragon Research analyst Jim Lundy said. The Surface Pro 4 and Surface Book are both pitched as productivity devices, not entertainment tablets, and Apple’s iPad Pro is a big-screen tablet with an optional digital Pencil and Smart keyboard (Microsoft actually took the Apple stage and touted Office for the iPad for the iPad Pro). Microsoft’s Office division generated $23.5 billion, or roughly one-quarter of the software maker’s revenue during its last fiscal year ending in June.

At that time, Google was trying a different approach by requiring an Internet connection to use its software instead of installing the programs on the hard drives of individual programs. By taking on the costs associated with an EA – a tool Microsoft uses to keep customers locked into contracts for longer periods of time in return for better pricing – Google is fighting back against one of Microsoft’s most powerful tools associated with retention. Now, Microsoft and most other software makers sell subscriptions that allow online access to their programs so they can be opened on personal computers, tablets and smartphones. Microsoft’s Office 365 for consumers is a success, but there are also a lot of young, future productivity workers who have grown up using Google Docs in school.

Microsoft, which is based in Redmond, Washington, also has been trying to chip away at Google’s dominance in Internet search and advertising for the past decade, with little success. Enterprise has a history of using powerful productivity apps, which means Microsoft has the advantage, but Google is willing to fight for its piece of a valuable pie that looks better than the consumer business because it includes monthly and yearly fees and contracts. Google’s new business software offer “represents a continuing saga in the battle with Microsoft for control of the desktop and mobile devices,” Lundy said.

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