To announce its move to a cloud-based e-mail system, Virgin America took to the sky. On Tuesday, the company had a skywriter print "VIRGIN AMERICA HAS GONE GOOGLE" in dot-matrix tufts of smoke above its headquarters in Burlingame, Calif.

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Virgin America Goes Google

Virgin America expects that by shifting from Microsoft Exchange to Gmail it can cut its e-mail costs in half over the course of a year. A company spokesperson declined to provide a specific dollar figure.

The company expects to save 18 terabytes of space over an unspecified period of time. "We presently have over 1,700 employees and use nearly 8 terabytes of storage with a projected e-mail storage cost for 5,000 employees at over 18 terabytes," a spokesperson said in an e-mail. "As we continue to grow and add teammates, our storage needs will increase at a similar rate."

Virgin's spokesperson said that the company is planning to grow, having just recently signed a deal with Airbus for 60 new aircraft. Virgin America is a U.S.-based airline; Sir Richard Branson's Virgin Group owns a minority stake,

"The transition to a cloud-based e-mail system allows us to save costs and increase the speed and efficiency of our platforms, so we can focus on what we do best: elevating the flying experience," said Virgin America CIO Ravi Simhambhatla in a statement.

Simhambhatla also praised Gmail for being always up-to-date, noting that his company's business model depends on staying ahead of the competition through flexibility and efficiency.

Virgin America has already begun shifting its 1,700 employees over to Gmail and expects the process to be completed by November 10th.

Virgin America already uses Google Docs and Calendar. The company "will continue to expand our Google Apps use as teammates get more comfortable with the software and as our needs change," a company spokesperson said.

Google's win is but one skirmish in an ongoing war with the likes of IBM, Microsoft, and Novell to capture a larger share of the $20 billion corporate e-mail market. Microsoft earlier this month scored a big victory when State of California awarded a three-year $50 million contract to CSC to migrate the state's current multiple e-mail applications to Microsoft's cloud-based Business Productivity Online Suite (BPOS).

Prior to the announcement of the awarding of the contract, Google asked California officials to revise their requirements, which it claimed were written to favor Microsoft -- a charge state officials denied. Having failed to convince the state to change its requirements, Google decided not to even enter what it believed was a rigged competition.

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