Dale Vile, Open Reasoning

I was interested and encouraged to see the announcement this week from Google of its new initiative to create a reseller channel for its online office applications. While I still remain sceptical about the appeal of cloud based propositions in a core business environment as a replacement for traditional desktop suites, mainly because the feedback we get is that people have more pressing things to worry about than fixing something they don’t regard to be broken, if traction is to be gained in this space, then the channel is a key part of the equation.

This is something I have discussed in depth in my research note entitled ‘Taking Cloud to the Mainstream’, which can be downloaded from here if you are interested in a review of some of the market practicalities and realities.

In the meantime, while the cloud evangelists will no doubt get all excited about one of their darlings making this move, we have to be realistic about how long it takes for a supplier to develop a viable and productive indirect channel. Too often, I have seen reseller initiatives started then fade away after 6-12 months as patience is lost with the slowness of the process. The reality is that it takes at least a couple of years for a brand new channel programme, especially a volume one, to deliver consistently. Whether Google will have the staying power remains to be seen, though if it wants to penetrate the SMB market, it really has no choice for the reasons I outline in the abovementioned research note.

In many ways, this move by Google is a bit of a distraction when considering how the SMB market for SaaS based solutions is going to open up in the shorter term. The real player to watch here is Microsoft, for a couple of reasons. Firstly, it already has the channel in place, and extending existing relationships and agreements is an order of magnitude easier and quicker than building new ones from scratch. Secondly, the Microsoft Software plus Services (S+S) philosophy is both more mature than the Google’s cloud centric play and resonates much better with the target audience. From a channel perspective, the S+S approach, potentially allowing bundles of pre-integrated on-premise and on-demand offerings to be sold together, is also more in tune with the cross-sell imperative that is ingrained in the reseller community.

Despite these market realities, though, I applaud this latest move from Google as a sign of it getting real about tackling the mainstream business sector effectively, rather than relying on posturing and media hype, which cuts little ice in that space. I also welcome the possibility of some serious competition for Microsoft in the office suite arena, which the market is desperately in need of. Will Google Apps provide this? I guess we’ll have to wait and see, as Google is now very much playing on someone else’s turf.



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