It's going to take a lot more than a Web-based productivity suite aimed at business users to get Microsoft panicked about Google. That's the main message the Redmond software maker hoped to seed among market researchers via a strategy-update call on February 22. It was purely coincidental that Microsoft scheduled its own software-plus-services (SPS?) call the same day that Google launched its software-as-a-service (SaaS) Web-based office suite aimed at business users, Microsoft officials said. "For the record, this is a long-scheduled thing, has nothing to do with anything in the news," Adam Sohn, a Microsoft Director of Global Sales & Marketing PR, said. However, the timing couldn't have been better for Microsoft, given the flood of pundits proclaiming that Microsoft Office was now officially toast, as a result of Google's unveiling of Google Apps Premier Edition. "Microsoft knows it's getting Googled," said Yankee Group analyst Laura Didio. "This is their latest attempt to make themselves look edgier and look like they have a plan to move toward SOA (Service Oriented Architecture) and services." On the Microsoft call, Charles Fitzgerald, Microsoft's general manager of platform strategies, attempted to drill into analysts' heads, yet again, Microsoft's contention that software and services are not exclusive, analysts said. Windows Live services are complementary to Windows. Ditto with Office Live and Office.DiDio said Microsoft also emphasized how it is decoupling its applications from the platform, allowing its software to run on non-Windows systems and devices. As company officials have been emphasizing for the past couple of years, Microsoft is going to continue to develop the two in tandem, not replace software with services. That doesn't mean Microsoft is simply sticking its head in the sand though, company officials are stressing. Microsoft is pushing harder and spending more to make sure that it has services that will extend desktop and server software. The message is "there are lots of synergies in their products," said Peter O'Kelly, an analyst with The Burton Group. "Even Google is pitching that (Google Apps Premier Edition" is more complementary to (Microsoft) Office than competitive." O'Kelly reiterated that it's more of a battle of data centers between Microsoft and Google, than it is a battle of the office suites. There's another services area Microsoft's plumbing that Google doesn't seem to be: Server-side services. Microsoft is just starting to test the waters here with InfoPath forms services, Excel services and Project services — all of which complement SharePoint Server.. (I hear that Access services might be among the next batch to arrive.) Even though Google's got more buzz, don't count Microsoft out, O'Kelly said. If you look historically at when Microsoft "really gets galvanized, it's when they face an existential crisis," he said. It took Firefox's growth to reenergize Microsoft's Internet Explorer strategy and product line. Don't be surprised to see Google's Web-app push "help accelerate Microsoft's investment in this area," O'Kelly said. Without Google's push, it might have taken Microsoft a much longer time to add services to its software, O'Kelly said.Right now, Microsoft "is not articulating their message well enough," DiDio said. But she added that she thought "Google was getting a pass at this point for being hot,
Office 2007 Enterprise," and that it still had a long way to go to deliver on its vision.
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