Strategic CIO // Executive Insights & Innovation
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8/5/2009
03:53 PM
Chris Murphy
Chris Murphy
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Microsoft Vs. Google Shows 'Alternative' Gone Mainstream

Three weeks ago, Microsoft said it will offer an online version of Office free to consumers, gambling one of the most successful software products in history on an emerging business model. Google this week calls that monster bet with … the price of four big-city billboards?

Three weeks ago, Microsoft said it will offer an online version of Office free to consumers, gambling one of the most successful software products in history on an emerging business model. Google this week calls that monster bet with … the price of four big-city billboards?Microsoft's bet is rather more daring than Google's, but both fuel the sense that we've hit a point where formerly "alternative" software models become the norm.

Microsoft's Stephen Elop, who leads its business division, articulated this recently, telling Cnet "we're at some form of generational shift into this world of software plus services." It goes well beyond Mr. Benioff touting the "end of software," though it was kind of him to get the discussion started. It's Microsoft putting Office profits in play on an unproven model. It's SAP, despite some cold feet over the SaaS model, deciding to build an ecosystem of software services around its ERP, before CIOs do that themselves with Salesforce, Workday, and a world of other SaaS apps. It's Salesforce trying to be a platform, for apps as complex as electronic medical records. And it's Google feeling sufficiently bold--or as likely, threatened--that it ramped up the publicity push for business users while it still has the advantage over Office of online access.

We're just starting our reporting to put more concrete examples behind our sense that CIOs are ready to embrace and shape alternative IT models in new ways. We don't yet know, for example, of a major company that has dumped Office for Google's productivity suite. (We're looking.) That's the litmus test for me for companies truly Going Google. Short of dumping Office, it's hard to see how CIOs get the kind of payoff from a Google productivity suite that impresses the CFO. CIOs want to support fewer apps these days, not more.

This alternative movement stretches beyond a software-plus-services shift. CIOs are searching for new options to pricey annual maintenance fees, for cloud-based approaches to infrastructure, for more efficient ways to mobilize software. We've been brainstorming about this broad trend toward alternative models within our IW reporting team. Now we're reaching out to CIOs investigating or implementing these models in aggressive new ways. If you're one of them, let's talk.

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