William F. Garrity

Paul Thurrott in Windows IT Pro writes about why Google's recent release of "Google Apps Sync for Microsoft Outlook" portends a big deal: being able to replace an expensive Exchange server with a hosted Google solution--and the users would "keep using Outlook with virtually all the same capabilities." (D-H would likely not do this, since, all things being equal, we would prefer to have our data on our servers.) 

Google Rains on Microsoft's Exchange Parade

June 16, 2009

Paul Thurrott

Over the past year, Microsoft Exchange Server has evolved from a traditional on-premise server to an online service, one that Microsoft itself will host, service, and support. That's quite an accomplishment, and it neatly answers complaints I and others have made about some of Microsoft's recent business-oriented products, including Small Business Server 2008. Such products are increasingly powerful, yes, but also increasingly complex.

Microsoft's decision to morph its traditional server products into hosted online services will be a huge win for its enterprise customers especially, and I feel that this kind of solution will eventually outpace on-premise server installations in both revenue and licenses. But enterprises aren't where the growth is these days in the server business. And when you look at the small-to-midsized business (SMBs) that will most benefit from the lack of complexity in Microsoft's hosted solutions, you realize there's still a gap: Microsoft's hosted offerings are just too expensive.

Racing to fill this gap is Google, best known for its online search engine but increasingly encroaching on Microsoft's bread-and-butter business customers. If you're still of the opinion that Google's business solutions are cute but immature, it's time to stop chuckling condescendingly and pay attention. Sure, Google has a way to go in the enterprise, but its business wares are getting better all the time. And most of them are free, or nearly so.

Helping Google somewhat, of course, is the current economic downturn, but let's be serious here: Saving money is always in season. And as more and more SMBs look for ways to stay competitive while cutting costs, they're going to turn away from Microsoft's comparatively expensive solutions and increasingly toward Google's free and inexpensive solutions. That's especially true if what Google offers is functionality identical, or at least very similar, to what's available from Microsoft.

And that's exactly what Google offers. The Google Apps solution, although initially derided for its technical immaturity, has really taken off with educational institutions and small businesses, and Google says the business is making money to the tune of "a few hundred million" dollars of revenue per year. But its latest related initiative is a small utility announced via a barely read corporate blog. This utility, Google Apps Sync for Microsoft Outlook, is a deep advance into Microsoft territory, hitting the software giant right where it hurts by letting customers migrate from expensive and complex Exchange Server solutions to inexpensive or free Google Apps while retaining their Microsoft Office Outlook clients.

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