A discussion about the software industry and their coders

In my previous two posts I stated two reasons why Google would not go after Microsoft’s Office business (1) Competitive history (2) Core Business Strengths. A third reason is Product Strategy. Let me delve into deeper analysis:

1) Competitive History: Microsoft considers Office as a core business and has left a trail of strong competitors in dust.

A) Both Corel and Sun tried competing with Microsoft with different business models – standard packaged software, free downloads on the Internet but didn’t succeed. Sun has now Open Sourced StarOffice, even then MS Office is not hurt. Google does not have a strong background in packaged software and distributor channels like Corel. It also lacks the Enterprise strengths of Sun. It therefore lacks crucial resources to succeed with the traditional and large Office user base of Microsoft. Different competitors with different business models have failed. Chances of Google's success are not high.

B) Even though Google’s possible Office offerings would be based on Servers on the internet and served through web browsers; Microsoft controls Internet Explorer – world’s most prevalent web browser. Just as Microsoft successfully used its Windows dominance to compete with Corel and Sun, it will leverage its control over Internet Explorer and presence on Windows to battle with Google.

2) Core Business Strengths: Google is a Internet Search company. Microsoft is aware of Google’s strengths and would love it to enter the Office business and lose focus in the process. Google knows that Microsoft wants a piece of the Search business but is not a major force yet. It will do Google well to fight on the Search and Web 2.0 turfs where Microsoft has a long way to go.

3) Product Strategy: Google has lately faced immense public displeasure due to its strategy of collecting consumer data to improve search results. If Google (most likely) extends this strategy over the data created by Google Office users, it would face consumer acceptance issues. In an article in The Register Andrew Orlowski stated:  Schmidt said he did view Writely as a data collection tool - so consider yourselves duly warned.

Microsoft till now has not openly collected consumer data by scanning Microsoft Office documents (even though Microsoft has faced other security problems). Google will have to change this part of its product strategy if it ever hopes to win large crowds of consumers onto Google Office. Enterprises especially would be paranoid about losing their employee and company data to Google via Google Office and discourage its use or completely ban it.

post 3 of 4, to continue...