It may not be as glamorous as Google's online video store or its 3-D geographical mapping service. Nor may it be as controversial as publishing copyrighted material online, but the search-engine company's efforts to grow its enterprise business appears to be picking up steam.
Just this month alone, Google launched two new Mini versions of its search appliances and announced a partnership with EMC under which the industry's leading storage supplier will link its Documentum Federated Search Platform with the Google Desktop Enterprise search interface. Google executives foresee a viable business in bringing the company's search technology to enterprises of all sizes.
And there's more. Since launching its partner program in September, Google has signed 40 ISVs and solution providers, and is in negotiations with some large systems integrators as well. "The demand has been amazing--from large VARs and various ISVs to start-up-type companies, large software companies and systems integrators," says Matt Glotzbach, Google's senior product manager for enterprise products. "The program has just been a runaway success."
Even so, the enterprise business is a mere blip on Google's radar screen given the company's success in its core markets--public search engines and advertising. According to Google's most recently announced financials, for Q3 2005, revenue from the company's noncore businesses--including the enterprise--remains insignificant. "In the grand scheme of things, [the enterprise] business is less than 1 percent of their revenue," says Forrester analyst Matt Brown. "And the bigger it gets, the lower their margins will be." (Google plans to report its Q4 earnings next Tuesday, Jan. 31.)
So the question for Google is this: Why bother getting into the enterprise space at all?