Brij Singh's Blog

February 22, 2007

Google Applications goes premium, When elephants fight…

Filed under: Tech — Brij @ 9:19 pm

It’s the grass which suffers. In this battle there are many different kinds of grass which will now have to adjust in which direction they will be tilting going forward.

For those who don’t get their daily high from Techmeme, news of the day is that Google is now offering premium version of their Google Apps. We use it internally so we can totally appreciate the impact. Infact feature expansion to include GData and SAML based SSO are some cool features. Definitely worth experimenting with.

I think the bigger news is how this will impact SaaS market in general. Lot of people miss out on the importance of email as a center of any business application. Take CRM for example. Every customer wants to tightly integrate email with CRM system – both as a lead capture, ongoing communication and campaigns. Thats why companies charge for Outlook connector. With Gmail, Google has established it can write a world class email client. Combining that with Calendar, Document, and Spreadsheet we get a decently integrated office productivity environment. So far so good. Chills to Microsoft but nowhere an Office-killer. In IT world nothing gets killed, competition shifts elsewhere. Same thing will happen here as well.  [Update: Google lead engineer writes how this whole thing started with Gmail.]

I think biggest losers in this game will be business application vendors who are endorsing SaaS as a delivery model. Specially the non-differentiated category apps – expense management, CRM etc. Reason I say that is that lot of analysts haven’t fully factored is the importance of Jotspot acquisition in this Google move. I think Phil needs to factor in Jotspot acquisition as well:

That leaves open the option of adding additional pricing levels for more richly featured versions, which is exactly what Salesforce and many other on-demand operators have done over the years. So I think Google Apps will remain profitable at that level, and won’t undermine the profitability of other on-demand vendors.

What will happen when Jotspot is fully integrated with Google Premium package offering custom applications for internal use, complete with SSO, user access control and other enterprisey frills?. Jotspot combined with whatever development toolkit Google is working will be a good enough service for lot of companies NOT to look in the direction of Salesforce because of tight Gmail integration. That will also be the reason why Zoho kind of companies cannot survive standalone for too long.

They have been talking about this for some time now.

Overall its a great step in expanding the use of productivity applications. Long tails and emerging markets will win big time with this. So will bootstrappers like us.

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