Google Gains Momentum with Apps
One year after launching its channel partner program aimed at offering Google Apps to enterprise customers, Google this week said it is approaching 1,000 authorized resellers. Moreover, a growing number of those who offer managed services are recommending Google Apps, according to a survey released earlier this month.
The MSPmentor 100 report for 2010 found that while 68 percent of MSPs now try to sell hosted Software as a Service (SaaS) offerings to enterprise customers, 22 percent promote Google Apps as an option.
The news is noteworthy in that there is much debate about whether Google Apps is a strong threat to Microsoft's Office franchise and Business Productivity Online Suite (BPOS).
When Computer Sciences Corp. recently won the widely publicized $7.2 million contract to run the city of Los Angeles' hosted e-mail network with Google Apps, many dismissed its significance. But some held it up as an example that Google and others such as Oracle, IBM and VMware may be a credible threat to BPOS and Office and an alternative for partners frustrated with Microsoft's BPOS pricing and licensing terms.
"Millions of businesses have gone Google -- and our resellers, too, have gained momentum," said Stephen Cho, director of the Google Apps channel program, in a blog post Monday.
Analysts are also taking note of Google's wins. "They've had some success attracting good numbers of channel partners," said Directions on Microsoft analyst Paul DeGroot in an e-mail.
Appirio, a San Mateo, Calif.-based solution provider that has migrated 15,000 employees at the pharmaceutical giant Genentech from Microsoft Exchange to Google Apps, is among those who joined the Google Apps Authorized Reseller program, according to Cho.
Another is Cloudreach, a reseller in the U.K., which helped Small World Financial Services migrate 500 users to Google Apps. And one of the first to join Google's partner program from the outset was Atlanta-based Cloud Sherpas, which recently moved 950 employees at Lincoln Property Co. from Novell GroupWise to Google Apps.
Cloud Sherpas Founder and CEO Michael Cohn said in an interview that a growing number of enterprises are willing to consider Google Apps as a lower-cost alternative to offerings from Microsoft, IBM Oracle and Novell.
"A lot of decisions are being made based on budgets," Cohn said. "The economy was certainly slow in 2009 and IT departments still have to do more with less, and when they looked at Google, it's a great solution."
Cohn said that as the economy picks up, he won't be able to continue to ride the cost wave.
"The good news there is Google is innovating faster than anybody else," Cohn said. "When we looked at them as a partner, we realized quickly they have so many features, they respond to customers. And in the end, Google is [providing] an opportunity for us as a channel partner because in addition to reselling, we are doing system integration."
Despite Google's gains, many analysts say most enterprises are likely to stick with Microsoft's suite and corresponding hosted services, especially as the forthcoming Office 2010 gains more Web capabilities and serves as a front end to SharePoint 2010.
Indeed, in a post in her newly launched Redmond View blog last week, Allison Watson, corporate vice president of Microsoft's Worldwide Partner Group, touted Microsoft's success with BPOS.
"We already have over a million seats running BPOS today, and over 450 million seats of our consumer-based Online Services as well," she noted, calling on partners to look deeper into the offering.
Yet while Microsoft has far more coverage than Google with more than 5,000 BPOS partners, Google's momentum is not trivial, DeGroot noted. "It does pose a real concern to Microsoft, since Google does not have a client software business to protect," he said. "As a result, Google can expand its feature set and offerings more logically, create new APIs that let partners create complementary products, and so on."
Jeffrey Schwartz is editor of Redmond magazine and also covers cloud computing for Virtualization Review's Cloud Report. In addition, he writes the Channeling the Cloud column for Redmond Channel Partner. Follow him on Twitter @JeffreySchwartz.