Google Inc.'s (NASDAQ: GOOG) Google Apps project has gained steam (and customers) since its introduction a few years ago. Although it's not yet a true competitor to Microsoft Corporation's (NASDAQ: MSFT) Office juggernaut, it is making headway.

The "software as a service" camp is doing nothing but speeding up, as small and large businesses would like to offload expensive software installations and just use the Internet as a vehicle for getting things done across boundaries and time zones. Microsoft, though, is not capitulating just yet.

IBM Corp. (NYSE: IBM) is a name many businesses know very well. The former largest computer company on the planet left the hardware game a long time ago to concentrate on consulting services and business software. But, IBM's next nemesis won't be a company out of Redmond -- but a name on the tongues of millions these days -- Google Inc. (NASDAQ: GOOG).

Google, Inc. (NASDAQ: GOOG) was born eleven years ago as more of an experiment, and exceeding anything founders Larry Page and Sergey Brin could have ever imagined. That company -- just over a decade old -- is now poised to challenge the world's largest software company -- Microsoft Corporation (NASDAQ: MSFT) -- as the leading supplier of digital information flow for countless individuals and companies.

Google Inc. (NASDAQ: GOOG) is a true Goliath in the online world, exerting its dominance in search, Web-based e-mail, maps, software, and more. Despite this fact -- or perhaps because of it -- it seems that tech companies can't wait to do battle with Google. IBM (NYSE: IBM) is the latest rival to throw down the gauntlet, with the company launching its own internet-based e-mail service for businesses.

The new service, known as LotusLive iNotes, is geared toward employees who might not be able to access their company e-mail remotely. The no-frills program features basic applications such as messaging, calendar, and contact management. LotusLive iNotes is being offered at prices as low as $3 per user per month. (Google's Google Apps service, with e-mail and Web-based applications including word processing, is priced at $50 per user annually.)

Google (NASDAQ: GOOG) appears to be moving in the direction of having a new product launch every day. Over the weekend it said it would bring out its own internet browser. It also announced the launch of a video-sharing product for businesses.

According to Reuters, "Unlike YouTube, which is aimed at consumers, Google Video for business is designed to be shared among designated users within an organization's own Web domain, protecting executive speeches, product training, sales meetings or other employee video messages from unauthorized disclosure outside the company."

Because Flash video, the most widely used format, can already be put in password protected sections behind a company's firewall, it is hard to see why the new product would have much appeal.

Google has not had much success with its enterprise software. There is little evidence that the Google Apps desktop software is selling well. That may be because the company offers good free versions of the product. Most of Google's other productivity software including GMail, Google Calendar and Google Talk can be used without charge.

One of Wall Street's only criticisms of Google is that its move into enterprise products is not making any money. If that comment is fair, Google just dug itself a deeper hole.

Douglas A. McIntyre is an editor at 247wallst.com.

Google (NASDAQ: GOOG) Apps is a set of server-based word processing, spreadsheet, and presentation software created to go after a number of the features of Microsoft (NASDAQ: MSFT) Windows. While Windows uses the memory of the PC, Google's product runs over the internet on Google's servers.

Microsoft is getting sick of having sand kicked in its face. The big software company said that it would increase "the availability of its online services for e-mail and collaboration software," according to Reuters. The software had been available to smaller businesses but now it can be used by companies of any size.

Google claims that it has signed up 500,000 businesses to use Google Apps. That has to be a real headache for Microsoft.

Now, Redmond is forced to walk a fine line. If it offers too many services over the internet at too low a price, it could cut into its profitable Vista franchise. Most of Microsoft's margins are based on Windows, its server software, and Office. If the margins on those fall, the company's stock price is likely to take a large hit.

The news is another example of how Google is bedeviling the world's largest software company and hitting it where it hurts most, in its large profit centers.

Microsoft's problem may be that it cannot do anything about the problem other than match Google's products and probably drop what it charges. It is an unhappy option.

Douglas A. McIntyre is an editor at 247wallst.com.

Google, Inc. (NASDAQ: GOOG) has become a more powerful force on the "desktop" of the Apple, Inc. (NASDAQ: AAPL) iPhone as of this week, changing the way its Gmail web-mail program interfaces with the iPhone's software as well as creating a more computer-like email experience on the now-ubiquitous smartphone.

Gmail now presents itself pretty much like it does on a PC web browser when used on an iPhone (with the most updated software installed, of course). That is, messages are synced across platforms. Read a message on your iPhone, it becomes "read" on your PC's web browser or laptop screen. Sounds like a minor update, but it's really not.

Apple and Google are working to make the iPhone one of Google's premier places for showcasing its content. From email to news readers to maps to documents, expect Google's entire range of online applications to be available on the iPhone soon. Missing from the iPhone is any trace of software from Microsoft Corp. (NASDAQ: MSFT), naturally.

Could Google soon be seen on many new Apple laptop PCs as the "software of choice," even though an internet connection is required to use most of those applications? Seeing as though Google saw more hits to its website on Christmas Day from iPhones compared to other devices, the two companies are making a compelling partnership case-study thus far, much to Microsoft's chagrin.

Although it hasn't gained much attention in the media, a revolutionary computer is now on sale at your local Wal-Mart (NYSE: WMT). For just $199, you can buy the Everex gPC TC2502, a powerful PC with a hook: it is designed to run without using any Microsoft (NASDAQ: MSFT) products whatsoever. Instead of Windows and Word, you get Linux, OpenOffice and lots of Google Apps.

The computer itself is pretty impressive. Here's what you get for your $199: a 1.5GHz VIA C7 CPU, 512MB of memory, an 80GB disk, an Ethernet port, stereo speakers, and a DVD-ROM CD-RW drive. You also get an operating system called gOS and a full suite of software from OpenOffice.org. The operating system is specially designed to work with Google (NASDAQ: GOOG) applications like Gmail and Google Maps, and all software updates are free. The one thing you don't get is a monitor, but judging from the sidewalks of my neighborhood in Brooklyn, where working monitors routinely show up decorated with signs saying 'works perfectly!, please take,' that shouldn't be hard to remedy.

It's been a long time coming, but Google, Inc.'s (NASDAQ: GOOG) "Presentation" web-based presentation application is now available. As always, some are billing it as a "PowerPoint killer," which is Microsoft, Inc. (NASDAQ: MSFT)'s ubiquitous presentation software that is the lifeblood of business people all over the globe. Google's already unleashed its word processor and spreadsheet software to the masses (as well as email services, of course), so the presentation portion of the Google Apps package was eagerly awaited, if for nothing more than fodder for comparison to Microsoft's PowerPoint by the media.

Much like the freely available OpenOffice software suite, Google Presentation can import and use Microsoft PowerPoint files, has built-in themes, text formatting and so forth. Google Presentation, of course, has built-in online collaboration and sharing, which is something many PowerPoint users probably would love to see instead of having multiple versions of the same presentation floating around on the corporate server somewhere. Google's connective collaboration is the single-largest jump it has over locally installed software packages. On features, however, it lags behind. But, would a customer rather have tons and tons of rarely used features or a way to have a team contribute to a single presentation, even if they were dispersed all over the globe?

E-mailing a link to an online presentation is a great feature of Google's new Presentation offering, although services like WebEx have done this with PowerPoint for years. But, emailing a link instead of having folks login to a secure website is a tad easier on all concerned, right? Once Google Presentation gets out in the wild during the rest of this year, the pundits will surely answer that question. We'll be listening.

Now that Google (NASDAQ: GOOG) has begun to go after Microsoft (NASDAQ: MSFT) Office, International Business Machines (NYSE: IBM) wants a piece of the action as well.

Big Blue will launch a new, free office-like product called Symphony. It will be available on the internet, and it is free.

According to The Wall Street Journal "Symphony is based on software available from Open Office." The same foundation is used for Sun Microsystems (NASDAQ: JAVA) and Google's desktop applications processes. The product also has functions from Notes, a product IBM bought years ago. Notes was almost run out of the market by Microsoft. IBM hopes that the free software application will help it sell more recent versions of Notes, which includes e-mail and instant messaging.

Does the IBM launch matter? Probably not. Nor does the recent upgrade of Google Apps to include software similar to PowerPoint. Microsoft has about 500 million desktop applications running on PCs and the Journal writes the company has "sold 71 million licenses of its latest version of Office in the fiscal year ended June 30." The Office software sells for slightly more than $100.

Getting customers to leave Microsoft, with its huge installed base, is almost impossible.

Douglas A. McIntyre is a partner at 247wallst.com.

Microsoft Corp. (NASDAQ: MSFT) seems to be having a whirl of a time determining if Google, Inc.'s (NASDAQ: GOOG) 'Google Apps' really does pose a threat (however minor) to its billion-dollar Microsoft Office franchise. Maybe the company is leaning towards a yes, though.

This week, Microsoft launched a missile across the bow of Google Apps, distributing a paper that posed eight specific questions companies should consider before deciding on using Google Apps. With many large companies opting to supplement existing Microsoft Office installations with the web-based Google Apps programs (word processing, spreadsheets, calendaring, e-mail), Microsoft may be stepping up to defend itself more in the near future.

Google itself and some of its larger customers have stressed that the goal is not to replace Microsoft Office (yeah, right), and that Google Apps simply fits some situations better than a full-blown copy or license from the not-free Microsoft Office software. Microsoft's litany of questions released this week included these:

• Companies should question the actual number of users Google has "within the enterprise"
• Google's history of releasing "incomplete products, calling them beta software"
• Desktop costs will rise for companies trying to offer both Microsoft Office and Google Apps
  

Ironically, Microsoft is also questioning Google's reliance on advertising revenue even as it tries to catch up to Google in the internet advertising space's battle for revenue.

Capgemini, the largest computer consulting firm in Europe, will begin to market Google (NASDAQ: GOOG) Apps to its corporate customers. It would have been hard for the big search company to get a better endorsement. Capgemini global outsourcing chief executive Paul Spence said, "Incorporating Google Apps Premier Edition into our offering is yet one more way that we are helping our clients adopt technological innovations within a robust and tested framework."

Google Apps has companies' e-mail, spreadsheet, word processing, and presentation software packaged into one bundle. The software operates on PCs with most of the processing being done on Google servers instead of one the PC itself, the way that Microsoft (NASDAQ: MSFT) has done so far.

The move has to be considered as a fairly big blow to Microsoft Office. Since its launch, Google Apps has been characterized as a nice, inexpensive solution for small businesses. It does not appear to have been widely adopted even in that market, but having a large IT consulting firm offering the software could begin to change that perception.

Microsoft, which is beginning to market desktop software that operates on servers to compete with Google, does not need a big boost for Google right now.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Microsoft (NASDAQ: MSFT) is going to add to its Office applications on the online-front in the next "year or so," according to a recent Financial Times article. This move is clearly in response to Google's (NASDAQ: GOOG) continued attack on Microsoft and its various product segments, in this case Google Apps.

Microsoft's probable first move in the online front is to allow spreadsheets and documents to be published on the internet privately so they could easily be worked on by groups of people -- a move clearly following Google's lead. Ultimately, Microsoft would like to begin offering full versions of Office online, but this is three or more years away according to the article.

It's very unclear if this move will have a significant impact on Microsoft or Google's financials, but one thing is clear: consumers stands to win from the heavy competition, as they would in any sector. In this case, Microsoft is streamlining its Microsoft Office to allow inter-office collaboration with simplicity due to Google's prior innovations in this area. This "competition is good for you" theme can also be seen in the video rental space; because of competition between Blockbuster (NYSE: BBI) and Netflix (NASDAQ: NFLX), both companies are constantly cutting prices. While this is most certainly disappointing for investors, the consumers stand to pay lower and lower prices.

Cheers to competition.

Microsoft Corporation (NASDAQ: MSFT) has two main cash cows at this moment: Windows and Office. Together, those two pieces of software (in all their iterations and versions) bring in the lion's share of revenue to the software maker. We're talking about tens of billions per fiscal year. Looking around the globe, there are free alternatives to both of those software franchises, though, which makes one think: why doesn't everyone use the freebies and stop paying for Microsoft's two big products?

The answer is bit complicated, so we'll attack the "Windows" question first. Microsoft licenses out the Windows operating system to almost all computer makers who then install it on the PCs they sell to the public and businesses (and everyone else). No customer probably told Dell Inc. (NASDAQ: DELL) or Hewlett-Packard Company (NYSE: HPQ) that they wanted Windows -- there simply is no choice when buying a PC. Recent advances by Dell to make the free Ubuntu Linux operating system available on some PCs has happened, sure. But, the majority of the public just wants what they are used to, which is Windows. People love change, right? Wrong. There are then many (many) versions of Windows for servers and workstations that are sold as well.

Let's turn to Microsoft Office. Again, it brings in a ton of revenue to Redmond, even though there are full office productivity suites that compete with it. My guess is that many of you can't name one though -- and that is what Microsoft counts on, which is branding power. The full-featured OpenOffice productivity suite is pretty darn impressive (I've used it), and it's completely free and interoperable with Microsoft Office (not sure about Office 2007). Why don't more people use it then? Lack of knowing it exists is a possibility, and having to download the suite or order it for about $10 on CD may be obstacles. Plus, you can't find it on Best Buy shelves. If customers start becoming smarter and find out out about OpenOffice or even Google Inc. (NASDAQ: GOOG)'s Google Apps, could a large piece of Microsoft's kingdom come crashing down?

[Disclosure: I own MSFT shares as of 5-29-07]

Google Inc. (NASDAQ: GOOG) continues to subtly press its office productivity software into the hands of the masses, consumers and businesses. And yet, the company continues to say it is not targeting, as a whole, Microsoft's Office franchise, which requires a decent chunk of cash to purchase as well as installation on a PC (or network) to function.

Google's Gmail (email), Calendar (scheduling), Docs (word precessing) and Spreadsheet (calculations) require nothing but a web browser and an internet connection, while giving many "light" users the same capabilities as the Microsoft Office package. All for free. Will Google's services remain free? Who knows. One thing is clear -- it's incredibly difficult to give something away for free, then start charging for it in the future.

Google is now packing its services for internet service providers (ISPs) and other web-based portals what have millions of customers as a way to get that package of productivity software out into the hands of even more users. Its Google Apps Partner Edition packages all of the above-mentioned applications and more to give Google internet partners a complete bevy of web-based applications they can offer customers as a value-added service. Google even offers a pay edition ("Premier") that promises guaranteed availability and more email storage than its free editions. Will customers pay for the upgrade? These efforts are icebreakers for Google in seeing if it can create a revenue model off service subscriptions and outside advertising.