When Adrian Sannier became the technology officer at Arizona State University in 2005, he was given a daunting assignment: Make IT the driver in school president Michael Crow's ambitious "New American University" project, aimed at raising the school's academic standing while increasing the number of resident students from 65,000 to 90,000 by the end of this decade.

ASU hitches a ride on Google's "rocket," Sannier says Photo by Jon Gipe

Sannier quickly realized ASU didn't have the resources to pull it off alone and that "the only rockets around to ride were people who are operating at very different scales than we are." So he hooked up with one of those companies, Google, and last October began introducing Google applications to students and faculty through a Web portal. At one point, 300 users were signing up per hour, and so far more than 40,000 have made the switch to Google e-mail. Sannier plans to shut down the university's own e-mail servers later this spring. When that happens, thousands more will move over.

The portal provides access to other functions of Google Apps, including calendar (which users can now share online, something they couldn't do before), instant messaging, and search. Within the next two months, Sannier expects to offer personalized home pages and Google's Docs & Spreadsheets applications combo.

The cost to ASU: zero. The university had been spending a half-million dollars a year on servers and storage for its open source e-mail system, including administrative support costs. More important is the faster pace of innovation. "Now we're on Google's development curve, not ours," Sannier says.

WILL "CUTE" CUT IT?

After initially targeting small companies with no-cost business applications introduced last year, Google in February showed that it has grander ambitions with the release of a premium edition that, for $50 per user per year, includes phone support, additional storage, administration tools, and integration capabilities. Procter & Gamble and General Electric are among the companies testing it. ASU is avoiding the extra cost by going with Google's standard edition.

It's easy to find small companies that like Google's applications. They're "superior to anything else I've used on several levels," says Jason Winship, managing principal at Sea Change Management. "They are simple to use, they enable previously unknown levels of real-time collaboration, Google search is fantastic, the products integrate seamlessly with one another, and the user experience is the same, whether you're in the office or on the road."

However, it's hard to find examples, like ASU, where thousands of users (if not businesspeople) are tapping Google's applications. In fact, the ASU campus may be the largest concentration of Google Apps users anywhere.

Enterprise applications account for a tiny fraction of Google's revenue. So far, Google execs aren't claiming that Google Apps will actually replace Word, Excel, and other Microsoft applications, describing Google's tools as complementary; Google's documents and spreadsheets apps interoperate with Microsoft's. Until now, Microsoft Office was used widely at ASU. Students and faculty will have their choice of using Microsoft Office, Google Apps, or both.

"Will we replace, compete with, or complement Microsoft Office? Probably all of the above, depending on the organization and the situation," says Matthew Glotzbach, product management director for Google's enterprise solutions unit.

Outwardly, Microsoft's not worried. Speaking at the Stanford Graduate School of Business earlier this month, CEO Steve Ballmer dismissed Google Apps as "sort of cute." Cute, but watch those baby teeth.