Google Office 2.0: Will Ads Wreck SaaS?


When Google moves, the tech press quivers.


That's not entirely unexpected, since the search engine giant certainly has earned its fair share of clout in the tech space. However, the simple news that Google is following through on its promise to charge a subscription fee for Google Apps for Your Domain has renewed speculation about how Google's interest in any given sector is going to "change everything."


A BusinessWeek article breathlessly reiterates much of the same Google vs. Microsoft hoo-ha that was published immediately following the August introduction. The article is notably weak on numbers; it proclaims "hundreds of thousands of users at thousands of organizations are already using" Google Apps, broadly dubbed Google Office when it was announced.


ZDNet blogger Phil Wainewright speculates that Google will never be able to wean itself from its core model of advertising revenue -- the only way it's ever made money, we'd add -- and ultimately back away from a true SaaS play, or may ultimately undercut the sector on pricing.


Well, that's kinda what Google does.


It's something of an oversimplification; the sheer scale of Google and its AdSense program means that any Web-based sector it moves into is a likely candidate for monetization through advertising. Its software is never likely to be as good as services or hard installs you pay for, but then again, it doesn't have to be if Google gives it away for free.


Think of it through the prism of entertainment media: You can buy a DVD, you can subscribe to HBO, or you can watch The Office on broadcast TV. None of those options are untenable; you just pay for each of them differently, and your expectations of each delivery channel are different.


Of course, they put ads on DVDs now.

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