Small Business Tech Tips

Microsoft and Google continue to slug it out in the press.

In a recent blog post, I wrote that Google is releasing their first attempt at building a better computer operating system, a direct shot at Microsoft’s domination, and a powerful addition to the Google Apps suite of office productivity tools offered online for free from Google.

Now Microsoft is responding with a shot of their own, announcing that they will offer the Microsoft Office product suite online for free in the first half of 2010.

This is a big gamble by Microsoft, as their Office applications apparently account for the bulk of their $19B/year in sales at their Business Division. Obviously they don’t want to erode those sales, but they must figure that it’s better for Microsoft to thoughtfully cannibalize their own business, rather than have Google or another competitor do it for them!

How will they make sure sales of the Microsoft Office suite don’t quickly disappear? The theory is that their free online version will not have as many bells and whistles as their normal desktop version, and that a large % of users will still be willing to pay to get those additional features.

I definitely think there is some truth to that in the short term, but I wonder how long that will last. I, for one, use Google Apps a ton now, but I still prefer Microsoft Office on my desktop for building long presentations or complex spreadsheets. But the gap between Google Apps and my Microsoft Office suite seems to be closing quickly; I wouldn’t be surprised if I’m doing everything online within a year.

It will be interesting to see how this plays out. One thing is for sure: consumers are starting to have more productivity software choices available to them – I think that’s a win for small businesses everywhere.

Mike Cooch
CEO
Everon Technology Services, LLC

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Tags: google, google apps, microsoft, Office

This entry was posted on Tuesday, July 14th, 2009 at 5:04 am and is filed under Small Business Software Tips. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.