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As Microsoft celebrates the full release of Office 2010, it finds itself resorting to something it has seldom done in the productivity apps space: Play defense. In particular, it faces a noisy challenge from Google Apps.

Microsoft Office has been synonymous with desktop productivity apps in much the same way that Kleenex is synonymous with tissues or Band-Aid is synonymous with adhesive bandages. But then came the cloud and, with it, collaboration and mobile workers. The productivity apps space has changed, and now sitting at one's desk banging out Word docs isn't good enough anymore; employees need to be able to work away from their desks and with others.

Microsoft's response has been to make tighter integration with SharePoint a key selling point of Office 2010 and throw in Office Web Apps for free. By leveraging SharePoint, Office 2010 is much more collaboration-friendly than previous Office iterations have been. But that's too little too late, according to a blog post by Salesforce.com's Peter Coffee: "The vision of collaboration found in SharePoint 2010 dates back to 2007, when Microsoft shipped the previous release."

Google, meanwhile, isn't interested in a head-to-head battle of productivity apps -- after all, Office holds more than 80 percent of the market share. Rather, Google's pitch is how well Google Apps works as an enhancement to, rather than a replacement for, Office.

This is a shrewd move on Google's part. Microsoft has struggled to come up with a compelling reason to adopt the last few Office upgrades; Ribbon UIs and a few extra Word and Excel functionalities aren't exactly game-changers. But as collaboration becomes less a luxury and more a necessity, Office 2010 finally has that compelling reason, in the form of SharePoint integration and Office Web Apps. Google's response: Why give more money to Microsoft when you can add Google Apps to the Office software you already have for free?

Google knows it's not going to get millions of people to dump Office and become Google Apps users. But as Office accounts for more than half of Microsoft's profits, any success with the "Google Apps instead of Office 2010" pitch will hurt Microsoft's bottom line.

Google Inc. (NASDAQ: GOOG and LSE: GGEA) is an American multinational software corporation, first incorporated as a privately held corporation in September, 1998, that specializes in search engine, information retrieval technology and online advertising. With a market capitalization of US$118.32 billion as of June 2006, Google is the largest internet search company in the world, almost twice as large as rival Yahoo! The company employs approximately 6,800 employees and is based in Mountain View, California. Eric Schmidt, formerly chief executive officer of Novell, was named Google's CEO when co-founder Larry Page stepped down.

The name Google

The name "Google" originated from a misspelling of "googol,"which refers to 10100 (a 1 followed by one-hundred zeros). Google has become well known for its corporate culture and innovative, clean products, and has a major impact on online culture. The verb "to google" has come to mean "to perform a Web search", usually with the Google search engine.

Google services

Google's services are run on several server farms, which, in 2004, consisted of over 30 clusters of up to 2,000 PCs per cluster. Each cluster contains one petabyte of data with sustained transfer rates of 2 Gbps. Combined, over four billion web pages, averaging 10 Kb each, have been fully indexed.



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