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The Web Office Smackdown – Why It Does Not Matter

Mighty Microsoft wants us to Say goodbye to Microsoft Office 2003, and I am happy to comply. In fact I already did.  Just not the way MS wanted me to: instead of Office 2007 I migrated to Office 2.0, and, given how many people read this post (around 60k so far), I am definitely not alone.

Ironically just hours after reading the Microsoft discussion on Techmeme, another one started- this time on Web Office Suite: Who’s Leading The Pack? I do have my (biased) opinion, but the short, perhaps surprising answer: it does not matter.   As to the bias, I am an Advisor to Zoho – so take everything I say with a grain of salt.  In fact take everything anyone says with a grain of salt – we’re talking about freely available systems, go ahead, try them yourself.  

My bias aside I still picked the apps I think keep me most productive, and for now it is Gmail from Google and all other services from Zoho.  Yes, this means there are a few things I prefer in Gmail over Zoho Mail – but I’m actually using both, and due to Gmail’s architecture and a trick in Zoho Mail, my email is always in sync, no matter which one I access.  Zoho Mail is currently in private beta, and I expect it to improve significantly before the public launch. (Yes, one day I don’t want to have to say I prefer Gmail )

For word processing, spreadsheet, presentation…etc. needs I do consider Zoho the better choice.    There is the quantitative approach taken by ReadWriteWeb, i.e. Zoho simply has far more productivity apps than Google – but to me it’s the quality of the individual services, and as such, it’s clearly a subjective assessment.  I’m in good company though – see the MIT Technology Review, Gartner and countless blogs  in agreement.

Integration between all these applications is an area where Zoho’s homegrown strategy is starting to show results: for a good example just look at how Zoho Meeting sessions (the product announced today) can simply be embedded into Zoho Show slides. Compare it to today’s big news: Google’s presentation product will be piecemeal-ed together from  technology and talent acquired from Zenter and previously Tonic Systems, and perhaps one day integrated with the other Google Apps acquired elsewhere.   With this acquisition Google is on equal footing with Zoho, says Om Malik.  I doubt it, but frankly, that statement is  quite a compliment to Zoho.smile_wink.  Anyway,  the shopping-spree vs. homegrown integrated products comparison reminds me of the Oracle vs. SAP match in the Big Boys League (Enterprise Software).

 

I’ve started this article by saying it does not matter who’s better.  Time to explain what I mean.  I have no doubt Google will be the Web Office Suite market leader. It’s so simple: Zoho has more applications, of better quality, more integrated – but they don’t have Google’s clout.  But this is not a winner-take-it-all, zero-sum game: all players, including Google and Zoho are creating a new, emerging market.  It’s not about slicing the pie yet, it’s about making sure the pie will be huge – and Google’s brand is the best guarantee to achieving that.  Little Zoho can be a tremendously successful business being second to Google.  There will always be room for a second .. third… perhaps fourth. Data privacy, the quality of the products, better service, or just having a choice – there will always be reasons for customers to opt for a non-Google solution.

There’s more.  Now that ZDNet’s Dan Farber “outed” it, we can talk about Zoho’s further plans, including Business Edition, coming later this year.  (Dan’s story is actually the best backgrounder on “all things Zoho” I’ve seen published recently – I guess it was a productive yacht partysmile_shades. )  Zoho does not stop at “Office” applications: Dan hints at ERP and other business applications.  Almost a year ago I wrote a (then) speculative post: From Office Suite to Business Suite, and being the lazy guy I am, I’ll just quote myself here:

How about transactional business systems?  Zoho has a CRM solution – big deal, one might say, the market is saturated with CRM solutions.  However, what Zoho has here goes way beyond the scope of traditional CRM: they support Sales Order Management, Procurement, Inventory Management, Invoicing – to this ex-ERP guy it appears Zoho has the makings of a CRM+ERP solution, under the disguise of the CRM label.

Think about it.   All they need is the addition Accounting, and Zoho can come up with an unparalleled Small Business Suite, which includes the productivity suite (what we now consider the Office Suite) and all process-driven, transactional systems: something like NetSuite + Microsoft, targeted for SMB’s.”

Hm… today some of the above is no longer pure speculation.  If I expected Google to be the Web Office market leader, I can’t even begin to predict what happens to hosted business applications. 

Google has no offering in this market, and although there was a lot of speculation about them buying Salesforce.com,  the “big announcement” was a disappointment.  Of course they could still pull off a deal – but I wouldn’t, if I were Google.  Don’t get me wrong: I would actually like to see Google enter this market, since they have the clout to effectively create and expand it. I even know who they should buy (no, it does not start with Z) – but that’s a subject of another post.

Summing it all up, I believe the winner of the “on-demand race” will not be Google, Zoho, or any of their competitors – the winners will be the customers who will have a lot more choice in picking the right business solutions later this year. 

Update (7/6): Zoho vs Google Docs, of all places at Google Operating System.

Comments

  1. Hi Zoli,

    1. Zoho is better. Agreed.

    2. Who is better today does not matter yet. Somewhat agreed. Not necessarily Google will be the leader. This is taking financial muscle the main ingredient for an application to be number one in the market. Google has too many open fronts whereas Zoho needs to specialize only in their tool. This is something I agree with you.

    3. Zoho needs to push a marketing campaign before Google closes the gap the products have. If not then, you will be right all along.

  2. Based upon the info you have posted in the past about Zoho on your blog and my own look at the product; I would agree that it beats out Google Documents and Spreadsheets. Zoho will most likely continue to beat Google in this market, but I believe Google’s ulterior motive of organizing everyone’s data has to be considered here.

    I believe Google is not in the game of making a complete Microsoft Office killer product; they just want the majority of consumers to adopt their product so that Google has the consumers’ data on their servers. Therefore, Google can troll through the data to make more money off of advertising, in my opinion.

    This is not a bad thing for Google, but what I believe is the motive behind offering 50% of the functionality in a free product instead of consumers using feature heavy Microsoft Office. Since Google Maps is a prominent product on the iPhone, I wonder if Google apps are going to be fully accessible on the iPhone and pushed on consumers?

    For businesses, Microsoft Office and Zoho will have their battles because they both offer integrated business productivity solutions that can (or will eventually) tie into business applications. Something Google will probably not be doing much of unless its offering Adwords management through Salesforce.com. Will Google ever present an integrated business tool or will they stick with where the consumer interaction happens?

    Keep up the great work Zoli!

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  2. [...] as Zoli Erdos has said in relation to Zoho – there is no immutable law that says ‘winner takes all.’ Winner takes all may be true [...]

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