Enterprise Features

Google and Microsoft Compete For The Cloud

by sharon.shapiro on 16/08/12 at 4:25 pm

Along with the rise of cloud computing has come competition among cloud service providers.  Two well-known providers are Google and Microsoft – both of whom are popular with businesses, in particular.  While Google has already staked its claim in the cloud, as it launched its cloud service, Google Apps, in 2006 and currently has four different platforms available, Microsoft is eagerly working to compete with Google for the cloud.  Microsoft entered the cloud with Office 365 in summer 2011 and has recently made some changes in an attempt to strengthen its competition against Google.

Google Apps is a completely cloud-based service that is available for businesses, educational institutions, government agencies, non-profit organizations, and personal use.  The apps suite lives within the web browser and thus can be accessed from anywhere on any any device, providing users with complete universal access.  Google Apps also runs on a 99.9% uptime guarantee (including planned updates) and promotes communication and collaboration.

Office 365 is a hybrid cloud solution that is available for businesses and, most recently, educational institutions.  The cloud suite may require some additional servers and installation which will necessitate patching and licensing.  This may increase IT costs and also limit the mobility that users enjoy for all of the services.  Office 365 has a 99.9% uptime guarantee, but this does not include planned services and updates.

Differences in user experience aren’t the only things that separate Google Apps and Office 365.  So do price and platform variety, although Microsoft has tried to close the gap in these areas.  This spring, Microsoft lowered the prices of its Office 365 platforms by 20%, making the lowest-priced platform $48/user/year.  This platform is one of many for businesses. but it is available only for businesses with fewer than 50 people and does not include the full apps suite, meaning that users will need to purchase add-ons to run the full Office 365 program.  To compare, the most expensive Google Apps platform is Google Apps for Business.  Google Apps for Businesses runs for $50/user/year, but this price includes the complete apps suite (meaning that no add-ons are necessary) and the platform is available for businesses of all sizes.

In addition to lowering its prices, Microsoft also added a new platform to the Office 365 suite.  Previously, Office 365 was only available for businesses, but this spring Microsoft introduced Office 365 for Education.  While the addition did diversify Microsoft’s offerings, it still did not put it even with Google, who offers Google Apps for Business, for Education, for Government, and for Non-profit, as well as Gmail for personal use.  One similarity does exist, though – both Google Apps for Education and Office 365 for Education are free services.

Microsoft may be so concerned about competing with Google and attracting new customers because of a recent report by research firm Gartner, Inc. which stated that among businesses moving to the cloud for the first time, one-third to one-half are choosing to have a Google Apps migration.  In 2009, the same firm predicted that Microsoft would be outselling Google by 4 to 1 by this point, however that prediction turned out to be false.

Not only is Microsoft worried about gaining new customers, the company is also worried about losing existing customers.  In order to improve its retention rate, Microsoft has developed a “Google Compete” team, whose purpose is to prevent current Microsoft customers from having Google Apps setup.  Last month, the Wall Street Journal told the story of this team’s efforts, focusing on its attempt to keep Dominion Enterprises, a marketing firm, from going Google.  Microsoft invited the firm’s CIO, Joe Fuller, to Washington for a tour of the Microsoft headquarters including a look at the research lab, sneak peeks at new technologies, and views of roadmaps to existing technologies.  But despite the compete team’s best efforts, Fuller still decided that Google was the better option.  According to Fuller, Google offers a cooler product than Microsoft does.  Additionally, Fuller said that the switch would save him 50%, as he would pay $200,000 a year for Google Apps instead of $2 million for Office 365.

When examining these differences side-by-side and hearing the real-life stories of people switching from Microsoft to Google, it is not hard to see why Microsoft is working so hard to better compete with Google for the cloud.  But while Microsoft has made some big changes for the better, it still remains to see whether or not they will make such a big difference in the competition after all.

About The Author: Cloud Sherpas is a leading cloud service provider and was named the “Google Enterprise 2011 Partner of the Year.” As one of the first Google Enterprise partners, Cloud Sherpas has migrated over one million users across a variety of industries from legacy, on-premise messaging systems to Google Apps, helping organizations adopt cloud computing to innovate and dramatically reduce their IT expenses. A Google Apps Reseller in Atlanta, GA, Cloud Sherpas has regional offices in locations including San Francisco, New York, Chicago, Austin and Sydney, and has more Google Apps Certified Deployment Specialists than any other partner in the world.

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