This week, Google and Sun announced a new collaboration. No surprise there, it only makes sense for them to work together.
Where the interesting potential for this deal lies is with the portion that was not announced; StarOffice / OpenOffice and Google’s considerable talents for making web based applications come alive.
Today, Sun’s OpenOffice offering is not very impressive. I’ve tried using it a few times up until a year or two ago, but always gave up in frustration. While it works, but usually time it doesn’t send documents back and forth with Microsoft Office very well, or when it does share them, they come through corrupted.
That said, Google is perfectly positioned to take this software, and ‘googlize’ it. i.e. turn it into a world class tool. Will it affect Microsoft? Yes. But is it a Microsoft killer? No.
In this battle one could argue that either company’s killer strategy isn’t actually an application at all. Let’s take it a step back and use a political analogy to compare what’s going on in this battle and what occured during the Cold War.
Yes, you read right The Cold War.
Looking back at the 1945 – 1950 period, the Western Allies, led by the U.S., instituted the Policy of Containment as announced by President Truman. Authored in large part by George F. Kennan, it basically can be broken down simply as a policy to “wherever the enemy pushes outwards into our space, we shall push back with just enough force to contain them” The argument being that if one could not defeat the enemy outright, (nuclear weapons in this case making that impossible), you could contain their growth, and they would collapse unto themselves. The flip side to the Policy of Containment was that if you failed to contain your enemy, eventually they would conquer enough territories to challenge you on every front, and thus overwhelm you. Eventually, the West won the Cold War when the USSR could no longer support itself, and collapsed.
How does this relate to Google v Microsoft? Either one could argue to be the West in this battle, and depending on your perspective, you would agree.
Scenario 1) Google is the West, free wheeling, light on its feet; They can’t win a battle outright; their footprint is much much smaller than Microsoft’s. They need time to play catch up. How to keep Microsoft distracted and engaged at the same time? Make some feints towards Microsoft’s central revenue streams. Keep Microsoft engaged on their core businesses, and they leave new markets free to conquer. Eventually, Google acquires enough new markets that they are a threat on a sufficient number of market fronts to impact Microsoft’s growth, and to actually make real plays into Microsoft’s core businesses.
What would Google’s new market opportunities look like? They need to select new opportunities which no one offers at present, or find ways to re-write the book on how existing services are delivered. One such opportunity, which many people have have written about is GoogleNet.
A free, web based Office suite would be an opportunity, but due to the costs involved in all the data transfers, I would hedge that GoogleNet would logically happen first.
Scenario 2) Microsoft as the West. As capitalistic as any firm known. Large footprint, large revenue streams, established. Facing the upstart socialistic ideal based opposition. Google really does have some socialistic ideals at the core of its mission statement, not that I disagree with them, but I do acknowledge them.
Their challenge is to contain Google. It’s likely that they can’t stop Google from making their ‘next big splash’ but their challenge is to cut into Google’s revenues now, so that Google can’t sufficiently finance the big battle after that. After all, if you can cut into Google’s revenues, you can slow it down. Slow it down enough, and it will fade.
How to do it? The AOL deal matters. That’s a lot of revenue for Google that could disappear overnight. It would potential have more impact on Google as a percentage of revenue than a Google OpenOffice would have on Microsoft. Buying T-Mobile, or striking a deal with Verizon to offer free wi-fi before Google can would also seriously impact Google. People will simply LOVE the company that gives them free Internet connectivity.
Will people love Google for bringing them free Office? Not likely. There are bound to be ongoing compatibility issues. People will find these annoying. Will large corporations migrate? Not many. After all, there’s always the chance of a security leak, and would you want your internal memos and financials housed in such an environment? That’s where Microsoft earns a lot of money, and I would argue they would continue to do so.
Microsoft’s challenge is to maintain a focus on improving their core business, and continuing to improve their position on the Internet, while not becoming distracted by Google’s moves. There will be lots of trial balloons, and feints by both companies. Neither will really disclose their true intentions until they are ready.
That’s the broad scenario for the battlefield in which the new policy of containment is being deployed. There’s far more to write on this subject that I could or would in this blog. It would likely break the template!
It’s still to be seen who takes the role of East and West in this battle. Undoubtably, as the victor always writes the History, the victor will be the one which played as the West. Time will tell who gets to claim that crown.
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