Microsoft is on the defensive after losing a $6.7 million government e-mail contract to rival Google. A Microsoft executive said officials at the company were taken aback by the General Services Administration's decision, announced Wednesday, to implement Google Gmail for its 15,000 employees, instead of Microsoft Outlook.
"While we are disappointed we will not have the opportunity to meet the GSA's internal messaging needs, we will continue to serve its productivity needs through the familiar experience of Microsoft Office and we look forward to understanding more about GSA's selection criteria—especially around security and architecture," wrote Tom Rizzo, Microsoft's senior director of Online Services, in a blog post.
GSA had been using IBM's Lotus Notes and Domino messaging system before opting to move to a cloud-based e-mail architecture. The agency said the switch will help it reduce e-mail costs by 50% over the next five years.
Microsoft had hoped to convinced GSA that its Office and Office Live suite was better suited for its needs than Gmail, but GSA didn't bite. The rejection apparently hit hard in Redmond, as Rizzo wasted little time trashing his rival's offerings after the decision was announced.
"Google can't avoid the fact that often times they cannot meet basic requirements," Rizzo wrote in his blog post. "Rather than address deficiencies in their product by developing a more robust set of productivity tools, Google cried foul instead of addressing these basic needs," wrote Rizzo.
"Regardless of how organizations are thinking about the cloud, Microsoft provides a choice for their productivity needs; on premises, in the cloud or as a hosted solution. Google does not offer any such choice," wrote Rizzo.
Rizzo was referring to the fact that Microsoft offers both desktop and cloud-based versions of Office, while Gmail and Google Apps are only available as hosted, cloud services. That, however, is apparently good enough for GSA.
Microsoft's concern going forward: that GSA and other agencies that have switched to Gmail might next be tempted to explore Google Apps alternatives to Office—a development that could pose a threat to Office's near-monopoly in the productivity applications market.