Microsoft, Google On Office Computing Collision Course

The argument between Microsoft and Google over which offers the best approach to office application computing is over. If you look down on the two companies' desktop- vs. browser-based office application strategies from a 20,000 foot level, they are fundamentally the same, and the differences are in the fine print.

Three years ago, Google saw a future in browser-based office computing, put the blinders on (to desktop-based office computing) and plowed forward with its vision. At the same time, Microsoft was incredulous when it came to the idea of browser-based office computing, insisting that the novelty would wear off and that when the honeymoon was over, desktop office computing would prevail unscathed.

Today, both companies are telling completely different stories, each essentially involving concessions that the other is at least partially right. In acquiring DocVerse and improving interoperability between Google Docs and Microsoft Office, Google has conceded that organizations have certain power users whose needs might never be fully satisfied by browser-based office applications.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change

In launching browser-based versions of its Office suite, Microsoft has conceded that the desktop versions are probably overkill for certain users and that IT management could use the reduced management complexity that comes with delivering Office in a browser.

The net result is that, by the end of 2010, both companies will have collided on the same fundamental office computing architecture: a hybrid approach that supports both desktop- and browser-based office computing.

In fact, in both cases, the browser-based applications are inextricably linked to the underlying collaborative infrastructures offered by both companies. For example, wherever they're deployed, Microsoft's "Office Web Apps" will always be provisioned to business users from a Sharepoint server (either on-premises, hosted, or from Microsoft's cloud using the standard, multi-tenant edition of Microsoft's Business Productivity Online Suite 2010, which isn't due out until the end of 2010).

Likewise, with Google Docs, the browser-based office applications are provisioned to business users from Google Apps. Both Sharepoint and Google Apps include the underlying infrastructure to make document collaboration possible. In both cases, to get the browser-based applications, you have to take the infrastructure as well. (This is so even if you don't envision certain users of browser-based applications collaborating with one another.)

In terms of your technology roadmap, there's huge relevance to the way both Microsoft and Google have inextricably integrated their browser-based functionality into their collaborative infrastructures in such a way that buying one means getting the other. The relevance has to do with any third-party collaborative or document management systems that you might be considering to augment your overall Office application architecture.

For example, as a result of a recent European Union antitrust measure, Microsoft must now publicly document any programming interfaces including those of Sharepoint. As a result, document management solution providers like Alfresco are racing to leverage that decision by adding Sharepoint server emulation as a feature of their products and services. This makes it possible for applications like Microsoft Office that contextually interface with Sharepoint to contextually interface with a solution like Alfresco instead (as though it were really a Sharepoint server). The EU's decision essentially empowered customers to make wholesale substitutions for Sharepoint.

But, if your organization is going to depend on other features of Sharepoint -- for example the Office Web Apps it provisions -- then making such substitutions might not be such a good idea.

Assuming most organizations are going have some number of power users that can't do without the desktop-based Office, the question then basically comes down to which company you should turn to for the browser-based (and inherently, the collaborative) side of things: Google or Microsoft. To help you sort through any confusion that might arise out of trying to do an apples-to-apples comparison, check out my scenario list below (and note which company has the advantage):

Scenario: You want a cloud-based offering now.

Both Microsoft and Google will be delivering high-fidelity office applications from the cloud. Google's newest offering -- which introduces much more fidelity in terms of document formatting (and therefore better compatibility with Word documents) won't be finished until early summer, but is available for users to try out in a pre-release mode until then.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change

For business users, Microsoft's Office Web Applications won't be available until the end of the year when it launches the "standard" multi-tenant version of the 2010 version of its Business Productivity Online Suite (BPOS-S). BPOS includes Sharepoint. Microsoft's will also offer consumer versions of its Web applications that are associated with its Skydrive storage service (Google has a Google Docs offering for consumers as well). Those versions will be supported by advertising. In the meantime, between the two companies, the only one of the two that offers cloud-based Office applications now is Google (as a part of Google Apps).

Advantage: Google

Scenario: You want browser-based applications on a non-shared infrastructure.

So far, Google hasn't had an incident where a hacker has broken through Google Apps' security and compromised the contents of an organization's data. A couple of years ago, when I asked a Google spokesperson about the trustworthiness of Google Apps from a security perspective, the answer simply was "if that trust gets broken, we're out of business."

Nevertheless, despite the track records of outfits like Google and Salesforce.com when it comes to safeguarding confidential business data, many organizations are so nervous about putting storing their sensitive documents into a service that's accessible through the Internet (a.k.a. the cloud) that they refuse to do it. This is especially true with respect to Google after a recent and highly publicized attack involving the Gmail accounts of certain Chinese dissidents.

Whereas there is no on-premises version of Google Apps to deal with this concern, there is, of course, an on-premises version of Sharepoint. The current version of Sharepoint (and BPOS) cannot provision Microsoft's Web apps. The new version of Sharepoint (version 2010) which can provision Microsoft's browser-based applications to end users is due to be launched on May 12. Additionally, a private non-multi-tenant version of BPOS 2010 -- one that essentially amounts to a hosted option (not technically a cloud option) -- will be available from Microsoft as well. Microsoft positions this BPOS-D option (the "D" is for "dedicated) as a solution for companies of 5,000 users or more.

Advantage: Microsoft

Scenario: You want compatibility with Microsoft Office.

In its newest release of Google Docs, Google has made significant strides in terms of compatibility with the formatting that users often take advantage of in Microsoft Office. These improvements include easy stuff like boldfacing, underlining, and italics as well as the hard stuff like bullets, tabs stops, justifications, indents, embedded images, etc.

Today, the best offerings that both companies have in terms of Office-compatible Web apps are not officially shipping. Google's newest version is not scheduled to be in beta until early summer. Microsoft's online versions (the ones associated with SkyDrive) are still in "technical preview" mode.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change

In some very ad hoc tests of both companies' pre-release versions, InformationWeek had problems with clean imports and exports. For example, when exporting a document with an embedded image from the pre-release version of Google Documents (the word processor) to Microsoft Word, the embedded image got lost in translation. But when we took a relatively complicated Excel spreadsheet and tried to import it into both companies' online spreadsheet offerings, it was the pre-release version of Microsoft's Web-based Excel that completely bombed the import. Google handled the same import without a hitch. Both companies acknowledge that work remains to be done between now and when they officially release these newest solutions.

Ultimately, organizations will have to do some of their own testing with their own "edge case" documents and the two companies' offerings to determine which does a better job. But ultimately, no one knows Microsoft's formats better than Microsoft. Additionally, although it was never a design goal of Google's, Microsoft is also going to certain lengths to make sure that its Web apps look a lot like the desktop apps. This could ease the pain when it comes to some users transitioning from the desktop to the browser-based versions of Office.

Advantage: Microsoft

Scenario: You want simplicity in licensing and cost.

Microsoft executives have indicated to InformationWeek that they find Google's offerings to be confusing. But InformationWeek finds that to be more true of Microsoft's offerings than Google's.

In order to get access to the read/write versions of Microsoft's Office Web Apps (cloud-based or not), each user must have a license to use Sharepoint 2010, BPOS-S 2010 (available later his year), or BPOS-D 2010 (the latter two both include Sharepoint Server). This makes some sense since the Office Web Apps are provisioned from a Sharepoint server. But here's where some confusion sets in.

What many people don't realize is that, additionally, each user requiring access to the read/write versions of the Web Apps must also have a license to the desktop version of Microsoft Office 2010 (prior versions don't count). To complicate matters a bit further, there's also a separate "view only" license to Sharepoint that gives users access to the Web Apps, but only to look at documents, not to edit them.

Google, on the other hand, offers two versions of Google Apps (which includes the Google Docs suite of office applications): standard and premium. The former is free and the latter, which comes with more storage than the free version, better connectivity with 3rd party services, and technical support, has a published cost of $50 per user per year.

If we could provide you with a clear comparative cost for Microsoft, we would. But given the complexity in terms of getting to Microsoft's Web applications, not to mention the different prices that Microsoft's customers get on products like Sharepoint and Office, we can only say "for the most part, significantly more."

For example, here at TechWeb, we are charged $281 per copy of Microsoft Office. But for that $281, we get a perpetual license. For that same $281, we could get 5 years of access to Google Apps (which includes Sharepoint-competitive collaboration capabilities and an Exchange-competitive email server). I predict that eventually, in the same way that Microsoft has had to concede that a Web-based application suite has its place in businesses, it will eventually relax the licensing requirements to get to the Web apps: namely the Microsoft Office license requirement.

Advantage: Google

Scenario: Dealing with your legacy

Google often talks about how it has 25 million users representing 2 million organizations on Google Apps. What isn't known though is how many of those users and companies are relying on it, paying for it, or both. Meanwhile, with more than 90 million licenses (Microsoft claimed 85 million in 2008) in play, Sharepoint servers seem to sprout up like weeds in many organizations. So popular is Sharepoint that it has its own healthy and thriving ecosystem replete with all kinds of third-party tools, consultancies, events, etc.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change

As mentioned earlier, in recognition of the size of that ecosystem, many third-party document management and collaboration solution providers are now leveraging the EU's "opening" of Sharepoint's APIs in hopes of stealing some of Microsoft's business away from that ecosystem. Google, however, is not one such third party. Not that it couldn't be, technically or culturally. Over Google's history of trying to woo customers away from Microsoft, it hasn't shied away from the idea of API compatibility. But for now, it's not known whether Google might consider this option over the long run.

Meanwhile, in terms of both the office applications and the collaborative infrastructure, Microsoft is the 800-pound gorilla and Google not only has to stop that momentum, it must convince Microsoft's existing customers that it will be worth their while -- and whatever heavy lifting is required -- to migrate to Google Apps.

But wait, there's more. It isn't just about convincing Microsoft's customers to migrate to Google Apps. Google's offerings may have piqued the interest of some number of Microsoft's customers toward moving to a cloud-based model. If it's just the cloud part of Google's model that's tickling the fancies of those customers, Google must also distract them from the idea of migrating from their on-premises or hosted versions of Sharepoint to Microsoft's BPOS-S.

How this technology hits an organization's bottom line will obviously play a serious role in any decisions that get made. Last year was a financial nuclear winter for many companies. CFOs had an easy time walking into the CIOs office to say "What about this $50 per user per year Google thing?" This year is a different story. With the Dow clearing 11,000 and the economy showing signs of life, Google, along with any other low cost providers of Sharepoint-like functionality have lost some leverage when it comes to intercepting the demand for Sharepoint.

Advantage: Microsoft
Scenario: The Airplane Problem

If you haven't heard the news by now, some users will have to pay a pretty hefty price to get the new Google Docs -- they'll have to give up offline access. Currently, through a plug-in called Google Gears, users of Google Docs can still work with their documents in a browser as though they were still connected to the Web. A lot of people refer to this as "the airplane problem" because, for the most part, the people who need this sort of functionality are the ones flying around the world with no connectivity (although, even that problem is slowly being ameliorated by Wi-Fi on flights).

According to Google, very few people relied on this feature anyway. I'm not sure if that's because they didn't need it, or because they had trouble using it. I do know that I had to wrestle with the feature more than once, sometimes to no avail.

Microsoft Office on the other hand, doesn't have this problem. Given Microsoft's licensing strategy, where any user of Microsoft's Office Web Apps is also required to have a license to Microsoft Office, that means everyone has not just an offline option, but a robust one at that.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change

As stated earlier, however, Google has clearly conceded that some of its users are going to be power users who will need a copy of Microsoft Office. Evidence of this concession was the company's acquisition of DocVerse -- a solution dedicated to the replication and synchronization of Office documents with the cloud.

Eventually (I'm guessing before the end of the year), that replication and synchronization will be with Google's cloud, which means that those people "flying around the world with no connectivity," will have the same option at their disposal as Microsoft's Sharepoint customers will. Somewhere down the line, Google will bring back the ability to work offline, thanks to the data-caching model in HTML5. Even so, buying a full blown copy of Microsoft Office for worker bees who need to go offline is probably well worth it for those people.

Advantage: Even

Scenario: Engineering Prowess

Neither company has its new suite of browser-based office applications ready to go yet. But, like anything else, when it comes to delivering Web-based applications, experience counts. Given Google's belief in Web-based computing, it has over the years, methodically acquired the various best-of-breed providers of much of the office functionality that's found in Google Docs today.

What's interesting is how the founders of those companies have stayed on with Google. Sure, they probably have some earn-outs that are yet to mature. But more importantly, they are deeply familiar with some of the seemingly intractable problems of delivering an application over the Web and into a Web browser.

One of those intractable problems is realtime collaboration. A lot of solution providers like to claim that their solution is about realtime collaboration. But, there's a difference between something that takes 10 or even 5 seconds and something that takes just 1 or 2. In the course of about a second, Google takes whatever changes multiple people have made to a document, saves them in Google's datacenter, and mirrors them out to everyone else's browser. This is all done with no plug-ins and works across multiple browsers (the no plug-in bit means it can work with mobile browsers, too). According to Google's engineers, that 10-second gap was really hard to close.

This truly changes the game when it comes to document collaboration. Whereas most collaboration tool providers focused their engineering resources on how to resolve conflicts between conflicting edits, Google decided to figure out a way to avoid conflicting edits altogether. Without Google's background and experience in running a large, multi-tenant, cloud-based offering (something Microsoft hasn't even done yet), intractable problems like these would be more difficult to solve.

That said, just looking at what Microsoft has been showing as a part of its technical preview of Office Web Apps (the one associated with Skydrive), it is very clear that Microsoft's only enemy in terms of delivering something that will meets many customers' needs (especially existing ones), is time.

Advantage: (for now) Google

Scenario: What else is in the box?

One reason it's impossible to do a true apples-to-apples comparison of Google to Microsoft is that their offerings differ so much in terms of what else is thrown into the box. If the closest comparison to Google Apps will be Microsoft's BPOS-S 2010, both have additional features and functions that I haven't begun to describe.

Some of these -- for example the ability to create intranet and Internet Web sites -- go head-to-head with each other. Both have an enterprise-class email server, too (one that Outlook works well with). Sharepoint has social networking features that Google Apps completely lacks. The Gmail service that comes inside of Google Apps includes a world-class anti-spam engine (courtesy of Google's acquisition of Postini). With BPOS-S, users get integrated unified communications by way of Office Communication Server. I could go on. I won't.

The question for you is whether or not you've vetted the list and checked off those things that are included that are must-haves versus nice-to-haves. Then, for the must-haves that one or both of the solutions lack, how much more will it cost you to get them.

Advantage: It's your call.

For the latest Desktop Apps news, opinion, and conversation, be sure to check out InformationWeek's Special Report: Desktop Apps: Time For Change