Thursday, July 16, 2009

Google's Battle in Business Software

The search giant is bent on taking on Microsoft, but its Google Apps' slow progress shows just how difficult that can be

With Google's (GOOG) announcement that it's creating an operating system to compete with Microsoft's (MSFT) Windows, the search giant and CEO Eric E. Schmidt look increasingly determined to undermine Microsoft's core software businesses. But Google's struggles on another front suggest the company may have a hard time gaining much traction against Microsoft.

Two years ago, when Google plunged into business software, it cited General Electric (GE) as one of its marquee customers. GE had begun using Google applications for tasks typically handled by Microsoft Office, which includes word processing and spreadsheet software. Now GE is rethinking the relationship. While still using Google Apps for some employees, it's testing similar products from a company called Zoho and considering the online versions of Microsoft's Office. "We look at it as a race" for GE's business, says Greg Simpson, chief technology officer at GE.

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