Analysis: Salesforce's Addition of Google Apps Shows Google's Intent to Enter Business Software Market
By tapping into Salesforce's customer base and latching on to that company's reputation as a trusted corporate technology provider, Google can make inroads in selling its software to businesses.
"Microsoft's real challenge is how to get people to buy the next version of Office," Wettemann of Nucleus Research says. "It's a pretty mature product. What other features can they add?"
The Battle for Hearts and Minds Continues
Google, meanwhile, continues adding features to Google Apps. It relies on the collective intelligence of its users to determine which ones should be tacked on to the product. The Google blog has provided a forum for developers to discuss how they can use open Application Programming Interfaces (APIs) community to build more functions on top of Google Apps. This led to Google Gears, a tool that allows you to take Google Reader offline.
Salesforce.com has undertaken a similar strategy with its Force platform, which allows developers to build business, web-based applications.
While Microsoft still thrives on a business model that relies on installed software, it has begun running a hybrid Web and desktop model that they've called software plus services. Its online version of Office serves as a good example. End users must have Office installed on their computers and then can go to a website where they can check in and check out documents.
But the movement to getting software over the Web will ultimately be decided by practitioners and business buyers, not the vendors themselves.
The Schumacher Group's Menefee, for instance, says nearly 50 percent of his company's software runs in a hosted environment now. He says software as a service has freed up his technical people to focus on other, more important things.
"This helps our developers to focus their time on innovation to build better solutions to impact the 2.5 million patients that our doctors see on an annual basis," he says.
