When Google announced a partnership with Sun Microsystems last fall, many people expected the search giant and the computer maker to launch a Web-based competitor to Microsoft Office. After all, Sun had a product called StarOffice, and Google had the bandwidth and the massive server "farms" to host any type of Web-based application.
In the end, the two merely announced a marketing effort involving the Google toolbar, and Google co-founder and gazillionaire Sergey Brin pooh-poohed the idea of a Web-based Office. "We don't have any plans" for such a thing, he said. A couple of months ago, Google chief executive officer Eric Schmidt even said that "Office is not the business we're in."
Despite those dismissals, it looks an awful lot like Google is putting together a Web-based Office suite.
First, it bought Writely.com, which allows users to upload and collaborate on Word documents. Then it launched a Google calendar application (called, rather unimaginatively, Google Calendar), and now it has launched a Web-based spreadsheet service (and yes, it's called Google Spreadsheets). To use these services, people simply log into a Web page instead of buying and installing software.
The benefit for users is that they can access their documents from any personal computer, and they can also easily collaborate with others on a Word document or Excel spreadsheet -- for example, a high-school soccer schedule or an office newsletter. For Google, meanwhile, offering such services is an easy way to get more traffic and perhaps eventually sell more advertising. And if Microsoft feels a little pain, so much the better.
But are these products really competitors to Microsoft Office? Yes and no. While it's true that Writely and Google Spreadsheets -- and competitors such as NumSum, Zoho, ThinkFree and iRows -- are useful for working on documents from many locations and sharing them with others, there are things that make them less than compelling for corporate use. For example, they only work with an Internet connection, and all the data is stored on someone else's servers.
That latter point is bound to keep many companies from using Web-based apps, whether run by Google or not, if only for security reasons. And while the Internet access issue is not unsolvable, it is likely to keep some users from committing to a Web-based service. Writely and Spreadsheets also can't duplicate many of the features of Microsoft Office, because of the current limitations of Web-based applications.
"As a user, the trouble these apps present to me is that their core functionality attempts to duplicate something that my [desktop] software already does, for the most part, very, very well," says Rob Hyndman, a Toronto lawyer who works with technology companies.
Although Writely and other apps are useful in certain situations, Mr. Hyndman says, they "are not robust, and I have to sacrifice a lot of functionality to use them." That, combined with the fact that they are only available on-line, suggests "that they will attract lots of curious users, but few committed ones, at least for now," he says.
As the technology website The Register put it, Writely "is as much of an Office-killer as a catapult and an apple are to a missile defence shield." And when it comes to using Google Spreadsheets, Guernsey Research analyst Chris Le Tocq told the San Francisco Chronicle that if he were a corporation, "I would go nowhere near this."
So is Google devoting resources to offering Web-based Office-style services because it wants to kill Microsoft Office, or because it wants a piece of the $12-billion (U.S.) in revenue that the Office division makes every year? Hardly. What's more likely is that Google sees them as an investment in the future.
In other words, while Internet access may not be ubiquitous enough to make Web-based apps useful for everyone right now and Web software may not be able to duplicate all the Office features people want, Google is betting that will change. After all, analysts were skeptical about Web-based e-mail too, yet millions of people -- and even some companies -- happily use it.
Susquehanna Financial analyst Marianne Wolk said in a research note that while Web-Office apps might not mean direct revenue for Google right now, they could pay off over the longer term. "While no direct advertising monetization is likely, these applications should improve stickiness -- which, in turn, should improve loyalty and usage levels," she said.
Microsoft is also busy trying to ride the wave of Web-based software by launching its Live.com suite of services, including an updated version of Hotmail called Windows Live Mail. Although it has yet to offer Web-based versions of Excel or Word, most industry analysts believe that it is working on doing so, if only so that it doesn't lose any ground to Google.
The problem for the software giant is that its products are gargantuan in software terms, and not easily reproduced on the Web. But that doesn't mean it isn't trying -- and as companies like Netscape found out the hard way, Microsoft is a master at using every weapon in its arsenal to remain on top, including behaviour that later became fodder for an antitrust lawsuit.
Spreadsheets may be another warning shot across Microsoft's bow, but the Web-Office war continues. And in the end, users may be the ones who win.
Mathew Ingram writes analysis and commentary for globeandmail.com
