IT vendors quake as Google unveils more business apps

2 Sep 2008

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In a move that may send shivers of fear down the spines of business software vendors, Google has released Google Video for Business, which analysts interpret as a sign that Google is planning to become a serious player in the enterprise apps market.

The search giant released the extension to Google Apps, which allows business customers to share video in a secure corporate environment.

According to research firm Ovum, it is a sure sign that Google intends to expand its presence in the various industry categories of applications that demand a collaboration or sharing focus, for example a market currently enjoyed by Microsoft with its SharePoint technology.

According to Ovum’s senior vice-president of IT Research, David Mitchell, business software vendors will need to have a strategic response.

“Vendors that are looking to create a strategy to compete with Google have a real challenge. With most vendors there are well telegraphed major releases, with functionality described well in advance. With Google Apps, there is more of a continuous enhancement approach, as has become established in many of the Web 2.0 sites and been common in the most popular consumer e-commerce sites for many years.

“Consequently, vendors that compete with Google in the Google Apps space need to treat competitive intelligence as a weekly exercise, not the quarterly or even more irregular exercise that is adequate elsewhere.”

Google Video for Business is the latest addition to the Google Apps suite, and follows on from the launch of Google Sites. It allows customers to upload and share video. “Think of it as like turning YouTube into a workgroup application with security and confidentiality constraints that keep the video accessible only to authorised corporate users. Users can comment on the videos, rate the clips etc – ostensibly allowing simple sharing of video rather than highly advanced video editing,” said Mitchell.

The Google Video for Business application is to be included without increased charge to the existing Google Apps Premier Edition.

“CIOs must recognise that the adoption cycle of Google Apps is different from other categories of applications, and plan accordingly.

“Although some Google Apps are procured and implemented by businesses in the same way as traditional software purchasing, there are also different adoption principles at work. They are closer to the viral adoption trends that have marked many of the consumer and social networking phenomena. CIOs need to factor these different principles into their decision-making and implementation strategies.”

Mitchell said that a number of Google Apps began life as pilot implementations that have been initiated by line-of-business rather than corporate IT, in the same way that other software-as-a-service facilities have experienced.

“These are then followed by a more formal evaluation of the technology and the commercial value proposition, including an evaluation of how Google Apps would co-exist with existing infrastructure. This has been described as an adoption-driven market rather than a procurement-driven market by companies such as Sun Microsystems and Google. This change in adoption principles will increase over time.”

Mitchell said the consumerisation of IT is a much broader trend that is spreading through the industry, with technology that starts in the consumer market moving into the enterprise arena.

This, he said, has brought substantial challenges for the corporate CIO, who is tasked with offering the same facilities that users can find at home and integrating a diverse range of consumer-sourced IT into the corporate architecture – with security, data privacy and other constraints in place.

“The CIO must find practical ways to address this consumerisation rather than simply block them, in the way that some seek to do. There are real benefits in terms of productivity and costs that can be achieved by the CIO who can properly blend consumer IT into a corporate environment,” Mitchell explained.

By John Kennedy

Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com