Google to give away software to Microsoft Office defectors

SEATTLE — Google is offering new incentives in a bid to chip away at Microsoft’s hold on corporate America’s desktop.

The Mountain View, California, company is offering businesses free use of Google’s suite of word processing, e-mail and other productivity applications for the life of the business’ existing contract with another provider. Google is also offering to pay US companies that switch to Google a portion of the cost of migrating their applications and data.

It’s the latest salvo in a yearslong battle between Google and Microsoft in the highly profitable business of building software tools for office workers.

Microsoft, with the Office suite it cobbled together over three decades, dominated the business of selling office-worker software when Google began making inroads in the late 2000s with its own Web-based e-mail and document tools.

When Google first started offering its then-consumer-focused programmes to business software buyers, “a lot of times we were kind of laughed out of the room”, said Rich Rao, who leads the team that sells Google’s Apps for Work. “Fast-forward to the present day, we’re a serious contender in the market.”

Rao said about 60 per cent of Fortune 500 companies were paying for at least one of Google’s pieces of workplace software.

Microsoft, based outside Seattle, of course, claims similar data, saying 75 per cent of Fortune 500 companies have purchased Office 365, its Web-based Office variant.

Microsoft’s corporate customers typically buy Office through one- or multiyear “enterprise agreements”. Such agreements can make technology buyers reluctant to switch providers mid-contract.

In the offer announced Monday, Google will give US businesses with time left on licensing agreements with another provider free use of Google’s workplace applications as long as they agree to buy one year of Google services at the agreement’s conclusion. Google will also pay $25 per user to help defray the cost of switching software providers.

Rao said that the $25-a-head payment probably won’t offset all of the cost of switching, but “it will typically be a good chunk of it”.

“We’ve been working on being enterprise-ready for the last decade,” Rao said. “We’re at the point where we’re not only ready, but better for companies. We want to raise awareness in the market of our position.”

With Google gaining fans among governments and businesses, Microsoft in 2011 responded with its own Web-based versions of Word, Excel and its other Office programmes, packaged as Office 365.

There are signs Microsoft’s push may be paying off.

Data from Okta, a San Francisco company that manages office workers’ logins to Internet services, showed Google’s Apps leading among its corporate customers until a surge late last year made Office 365 the most popular productivity tool among its customers.

However, it’s unclear what portion of that gain came as businesses switched from Google to Microsoft, rather than desktop Office customers signing up for the Web variant for the first time.