Office Apps on the Web just got a kick in the shorts.....

I almost missed this one, but Google has announced the availability of Google Apps Enterprise and are actually moving away from their "advertising revenue" model and charging a monthly fee per user of $50 (which is really pretty good, considering for a company of 10, that relates to $500 a year - compare that to the cost of Microsoft Office 2007 [standard edition] @ $399.

I read several posts about how the market for Office Suites (online or off) is not necessarily a price play - there are other considerations, like the actual users, integration with back-office applications or data - all of these are correct (or at least I believe they are correct for the current consumers/users of MSFT Office. Where they have limited or no relevance is for any emerging economy - think Asia (not US, Europe, ANZ, etc.).

If you are Google and you have the cash stores to think beyond next month's payroll requirements, why not think in terms of decades or quarter centuries? Right now, there are two men that own 20% of Google - they are still in their 30's and could conceivably be around for the next 40. That's not true of Microsoft, there's one guy that owns a significant amount of MSFT stock (at about 10%) and he is in his 50's - he could be around for the next 20 years, but there's evidence that he's tiring of the whole thing ( i.e. he gave up the reins of CEO). That's not to say he won't be intimately involved, it's just saying that he's not as involved today as he was a few years ago.

So, if you fast forward just 10 years, you now have an established economy in India, Pakistan and all the former Soviet States (and by way, they are still growing). You have an emerging economy in China and the SE Asia markets. What does the world of technology look like then - what happens when English is not the [primary] language of Business? What happens when Google China works with the Chinese government to "socialize" all the Google applications and the Chinese government decides to charge a "tax" on every citizen to support this initiative, say the equivalent of a $1 a year?

So, all those pundits out there, we who see all, should step back and understand that as little as 10 years ago, most people didn't even know who Google was and could have cared less.

2 comments:

  1. Oh that was really good analysis.In a decade things can change drastically.

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  2. Abhishek - thanks for the comment, always good to know when someone stops by!!

    It's one of the things that bothers me about US based economics - it goes back to the old saying by Milton Freedman "In the Long Run, we're all dead" - and that has been the problem with our "consumer" nation - damn the future, use all you can right now. Also, we (within the USA) are very egotistical when it comes to the world - believing we know more than everyone else and that we are always right. At some point in the future, the USA will no longer be the 900# consuming gorilla we are today - at that point, the whole game changes.

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Thanks for commenting and go ahead and let me know what you like and don't like. Always looking for ways to improve.