Does Google's New Tagline Imply a Shift to Enterprise Apps?

May 16, 2007

With a new tagline of "Search, Ads and Apps" announced May 14, and a new presentation application coming soon to complete the desktop quatrain of spreadsheets, word processing, presentation and e-mail, Google is poised to take on the world of desktop computing with the added ease of online collaboration.

While its long been speculated whether or not Google has the chops to take on the 800-pound gorilla in the desktop applications market, Microsoft, with its Office suite of spreadsheets, word processing, e-mail and PowerPoint applications, Google's tagline metamorphous may well represent a shift in the company's emphasis.

The question now is whether Google has any inclination to enter the enterprise applications market that goes beyond the desktop to backend systems like ERP (enterprise resource planning), SCM (supply chain management), and CRM (customer relationship management)?

While internal development of a suite of enterprise applications - more than likely on demand given Google's penchant for the Internet - is a possibility, there is also the potential for Google to acquire both the technology and customer base to really kick of an applications business.

"Given their pace of innovation I wouldn't be surprised if - Google - made a play in the enterprise space. Right now they're not looking to compete, but they are looking to be a broad base for use," said Nucleus Research analyst Rebecca Wettemann, in Wellesley, Mass.

"It's not out of the realm of possibility that they would acquire - an enterprise applications company - . It certainly would make sense if that's where they're looking to go; an acquisition of an on-demand player would make sense."

Google officials did not respond to several requests for an interview.

Back in August 2006 Google announced a free hosted software package, Google Apps for Your Domain, aimed at small and midsize businesses. An unfortunate acronym, GAYD seemed to have but one goal: unseat Microsoft Office desktop applications, including Microsoft Live on-demand desktop applications.

Fast forward to February 2007: After months of testing, Google announced its namesake Apps Premier Edition, a package of basic business applications that promised, among other things, 99.9 percent uptime (a standard service agreement amongst on-demand applications vendors), mobile access, API (application protocol interface) to integrate with a user's existing infrastructure and third-party applications and services.

Fast forward again to this month: On May 8 Google takes another major swipe at enterprise functionality with the release of the next iteration of its Google Analytics application. The software, marketed as "a free enterprise-class solution" helps businesses understand how their users interact with their Web site to help increase online business.

The updated product includes e-mail reporting, customizable dashboards, better map displays and plain language descriptions to make information more accessible, according to the company's Web site.

Google's CEO Eric Schmidt announced the tagline change during the company's annual shareholders meeting earlier this week. "The idea here is to talk about this shift to an online lifestyle," Schmidt said, according to media reports. "People are spending more and more time - online - and Google can bring some of these new applications that really matter to them."

Even if Google plans to take on just Microsoft Office - rather than the whole of the on-demand enterprise applications market - the company has some work ahead of it.

Google Apps "doesn't have the level of functionality that say an Excel spreadsheet would, so you're not going to see a power user moving to Google tomorrow," said Wettemann. "However for a company looking for word processing or a spread sheet there is an alternative that wasn't there before."

Copyright 2007 by Ziff Davis Media, Distributed by United Press International