Monday, August 28th, 2006>p>This has been such a rolling press release that I’m not sure it qualifies as news anymore, but it’s in the New York Times so it must be news. Google announced today that it is providing a set of hosted applications for small to medium sized businesses. The beta service will be free for now, and the premium service is under development.
What comes with the application suite? From the overview FAQ:
You can currently choose from Google Mail, Google Talk, Google Calendar, and Google Page Creator. Also, you’ll soon be able to add a Personalized Start Page for your domain.
I think everyone knew that this was coming, and there’s been speculation about Google offering its office-like applications — including Writely and Spreadsheet — as a pay service, for several months. The last two paragraphs of the Times article, however, point toward these applications being offered as appliance-based software to larger companies.
Providing technology to corporations and large organizations accounts for less than 2 percent of Google’s revenue, but the business is increasingly critical, Mr. Girouard said. Most of that involves selling “server appliances,” large computers that take on the job of conducting searches of large databases and company records.
“We are a very small part of Google’s overall business, but we’re growing quickly,” he said.
If Google starts to cut into Microsoft’s market share, this could prove the software as a service (SaaS) business model and might trigger a land rush by online companies into areas heretofore the exclusive domain of desktop application vendors.
Update: just saw this Red Herring article on the 17 competitors to MS Office. A thorough article that covers more than just the usual handful of Web 2.0 startups, it is well worth reading if for nothing else than these sorts of heartwarming quotes:
WriteBoard can seem almost bare-bones in its features, but Mr. Fried is betting on simplicity. “The problem with the traditional software industry is that they have to bloat their products,” he said. “They have to add more and more so they can get more money out of their users next year, but we don’t want to follow that model.”
Yes. Bring back the simple 64k application. My Commodore 64 is still somewhere in a closet in my parents’ house. ;-)