It has been announced this week that professional services multinational PwC have signed an agreement with Google to promote the technology giant’s suite of online apps for businesses to their enormous client base. In a move that could have huge implications for the growth of Google Apps it is clear that the California search behemoth is leaving no stone unturned in its assault on the corporate market.
By tapping into the existing and future client base of one of the planet’s biggest auditors Google have effectively announced their intention to take on the likes of Microsoft at their own game, spreading adoption of their Microsoft Office rivalling apps such as Gmail, Docs, Drive and Calendar. By locking horns with Microsoft in this way, competing in a space they’d never previously operated in, could Google be ready to topple the stranglehold Microsoft have long held on the business world?
Moving to the Cloud
The increasing popularity of Google’s online only apps reflects the growing market trend towards cloud based solutions for businesses of all sizes. Typically cloud software is a more cost effective option for businesses over more traditional desktop software products, allowing them to roll out less powerful, and therefore cheaper, hardware to run everyday business critical applications as processing power and storage is effectively outsourced offsite. What’s more the typical licensing model for cloud software allows for greater flexibility in terms of cost of implementation, so instead of spending $200-$300 per user to install the latest version of Microsoft Office, business owners can choose to pay a tenth of this cost per user for Google Apps for Work, and are always using the most up to date versions of the software.
Such has been the rapid rise in organisations wising up to this cost saving switch to the cloud that Microsoft have had to change their own model to try and compete. Office 365, launched in 2011, saw Microsoft offer its flagship business productivity software suite as a subscription service rather than an off the shelf product, attempting to keep users tied in to their ecosystem in the face of growing competition from Google.
Keep Up or Catch Up
Organisations not embracing the cloud run the risk of falling by the wayside as rivals gain ground thanks to reduced costs and more capable up-to-the-minute software. History is littered with examples of once mighty globally recognised brands losing ground to young upstarts who’ve benefited from shifting trends that they’ve been wise enough to adopt as soon as possible. IBM are a topical case in point as the company today is almost unrecognisable from the firm that was so dominant in personal computing in the 1980s. No longer flexing any muscle in the consumer hardware market and losing ground in the corporate software space, the PwC announcement is yet another blow as the partnership with Google will see staff in the US and Australia ditch IBM’s Lotus Notes software in favour of Gmail.
Similarly, smaller companies who were quick to adapt with the advent of cloud technologies have been able to take market share from larger and more recognisable brands by virtue of keeping ahead of the game. Sticking with the accounting theme, there are a whole host of smaller software providers offering cloud accounting software to rival the traditional big players like Sage, who are now benefiting from the comparatively slow pace at which the industry leaders got round to updating their own offerings. By being early adopters and recognising the many benefits of streamlined cloud solutions, these smaller providers have managed to hold their own in a space once dominated by companies hundreds of times their size.
So Where are Google Going?
By “muscling in” to the huge office software market Google are clearly looking to diversify their revenue streams, which are presently dominated by income from advertising. With the company’s most recent accounts showing “other revenue” up by 111% in 2013, and Apps for Work known to come under this category, the signs are that Google are well on their way to being a major player in the business apps space. And with the world’s second biggest auditor on board to help extol the virtues of Google Apps to the many businesses they work with, this rapid rate of growth is set to break new boundaries in the coming months and years.