At Zoho, we have been banging the drum on the coming new era of competition, thanks to the cloud, in software and how that is going to pose a serious threat to the stratospheric 90% operating profits that Microsoft enjoys on its Office suite. And sure enough, the news that Microsoft Drops Prices of Cloud Apps caught our attention. Some excerpts (emphasis mine):

Microsoft has lowered the subscription prices for its cloud computing applications, and has announced new customer wins and broader geographic availability for the apps.

The software giant has lowered the price of its Business Productivity Online Suite (BPOS), which includes online versions of Exchange, SharePoint, Office Communications and Office Live Meeting, from $15 a month per seat to $10 a month.

For Exchange Online alone, its email software-as-a-service, the price drops from $10 to $5. Microsoft also has increased its standard e-mail storage per user from 5 Gbytes to 25 Gbytes …

Still, are Microsoft’s cost cuts enough? Google Apps, by comparison, which includes apps for documents, spreadsheets and presentations, in addition to email, costs only $50 per user per year. Markezich’s response is that Microsoft offers a scaled-down version of Exchange Online, designed for employees who aren’t frequent PC users, for $24 a year, and a scaled-down version of BPOS for $36 a year. What’s more, “we’re not seeing any inclination that Zoho or Google or Zimbra or any other of those offering fake Office capabilities can replace [Microsoft Office],” he [Ron Markezich, corporate VP of Microsoft Online] said.

Wow, wow, wow – Fake Office! That is indeed a badge of honor for us. We just have a polite suggestion to Microsoft: to be perfectly consistent, Microsoft should also label their Bing “Fake Search” – fair is fair, right? For the record, we actually think Bing brings a welcome dose of competition and we certainly don’t think Bing is by any means fake, but with Microsoft marketing terming the entire competitive landscape to their number 1 cash cow “fake”, we have to wonder if that would apply to their own effort at competing with the other dominant vendor.

While Zoho and Google are happily doing update after competitive update to our respective Office suites, Microsoft, with their “real” web office, is not actually making their web offering generally available.

Seriously, the whole “fake office” designation illustrates the main problem Microsoft faces. In their world view, with their quaint “Release to Manufacturing” rituals, the fact that a Zoho user has no CD or DVD to buy, no bloatware to download, nothing to install, simply just visit a web site, log-in (using Google or Yahoo accounts, if they must), and they are on their way to Work.Online, must all feel a bit, well, fake. But take it from us Microsoft: there is nothing fake about browser-based applications, no matter how you wish to keep the world on your “manufacturing” world-view of software, with your proprietary lock-ins and your 90% operating margins.

It is a new world now – I have called it the Google Era of Computing a while ago. At Zoho, we fully grasp this fundamental reality. That is why we are excited about today’s other announcement, this one by Google: Single Sign-on to Zoho, Tripit, SocialWok and more from Google Apps.

As the Google announcement illustrates, cloud vendors are moving aggressively forward to establish a new competitive landscape. While Google is an existential force and a major competitor for Zoho, this new “Google era” also means tremendous opportunity for us.

Thank you Microsoft, for the “Fake Office” moniker. Please await our real launch of FakeOffice.org soon.

  1. shilpa2

    This is one of the best things to happen to you.Nice to see Micro Soft providing.thanks for the post like this.more myspace friends

  2. shilpa2

    This is one of the best things to happen to you.Nice to see Micro Soft providing.thanks for the post like this.more myspace friends

  3. Ryan Z

    Hello,M$ the old man,welcome to the future.
    It’s not your age anymore,so it’s time to change or…die.
    You will see more and more amazing products and services that beyond your vision in the future,of cause you will call them “fake”,just like ZOHO.
    Look,you can’t change the trend,you have to follow it.
    So…get used to it!

  4. Ryan Z

    Hello,M$ the old man,welcome to the future.
    It’s not your age anymore,so it’s time to change or…die.
    You will see more and more amazing products and services that beyond your vision in the future,of cause you will call them “fake”,just like ZOHO.
    Look,you can’t change the trend,you have to follow it.
    So…get used to it!

  5. hammoche

    Microsoft has a monopoly and manitains that by very dubious means.Zoho provides a great service. I use Ubuntu, so can you please support Linux more and make your service work with Google Chrome.Well done for a good service.

  6. hammoche

    Microsoft has a monopoly and manitains that by very dubious means.Zoho provides a great service. I use Ubuntu, so can you please support Linux more and make your service work with Google Chrome.Well done for a good service.

  7. Abraham Varuhannim

    Please don’t sell Zoho to anybody sooner or later. You will loose your agility otherwise. You are the next Google! If you continue at this speed and stability, you will probably become the lead of cloud in 5 years. So please don’t sell Zoho to big guys.

  8. Abraham Varuhannim

    Please don’t sell Zoho to anybody sooner or later. You will loose your agility otherwise. You are the next Google! If you continue at this speed and stability, you will probably become the lead of cloud in 5 years. So please don’t sell Zoho to big guys.

  9. y2gabs

    Amen amigo,It’s funny, every time I think, “hey this would be cool to offer my customers” you guys release it!You’re on the money, microsoft will copy along sooner or later.

  10. y2gabs

    Amen amigo,It’s funny, every time I think, “hey this would be cool to offer my customers” you guys release it!You’re on the money, microsoft will copy along sooner or later.

  11. Eagle

    First they ignore you, then they ridicule you, then they fight you, then you win …- copy and paste of the Quote from Mahatma GandhiEagle

  12. Eagle

    First they ignore you, then they ridicule you, then they fight you, then you win …- copy and paste of the Quote from Mahatma GandhiEagle

  13. vidyasagar

    Nice to see MicroSoft providing much more popularity for us with their frustration……

  14. vidyasagar

    Nice to see MicroSoft providing much more popularity for us with their frustration……

  15. SolusLunes

    James- maybe instead of trying to force an acronym out of “Fake”, why not just use the first letter?F-Office. 😀

  16. SolusLunes

    James- maybe instead of trying to force an acronym out of “Fake”, why not just use the first letter?F-Office. 😀

  17. John

    While I have no problem with the indignation, don’t you think that misquote on fakeoffice.org is just a little bit too much.

  18. John

    While I have no problem with the indignation, don’t you think that misquote on fakeoffice.org is just a little bit too much.

  19. Prasad

    I liked the word “FakeOffice” than traditional “Online Office suite….”Keep up the good work.

  20. Prasad

    I liked the word “FakeOffice” than traditional “Online Office suite….”Keep up the good work.

  21. Sachin

    infact the whole Windoze is faked using OSX..what say Microsoft…??????

  22. Sachin

    infact the whole Windoze is faked using OSX..what say Microsoft…??????

  23. CoryS

    Is that like Fake Steve Jobs? Well, then, start speaking in character!

  24. CoryS

    Is that like Fake Steve Jobs? Well, then, start speaking in character!

  25. Vic Berggren

    More importantly, are you going to join the ranks of @fakestevejobs and other and start tweeting as @fakeoffice 🙂

  26. Vic Berggren

    More importantly, are you going to join the ranks of @fakestevejobs and other and start tweeting as @fakeoffice 🙂

  27. weird

    It is strange how the actual quote is “…fake Office capabilities…” not “fake office”. Can you argue that Zoho offers all (as in all not some) of the same features and options as Microsoft Office? Also, yourself calling bing “fake search” is pretty sad. “Search” is a generic term just like “office suite” is a generic term. Microsoft compared your offering directly to their offering, not to office suite software in general. If you could understand that capitalized words in the middle of sentences are proper nouns, maybe you wouldn’t have made that mistake in the first place.

  28. weird

    It is strange how the actual quote is “…fake Office capabilities…” not “fake office”. Can you argue that Zoho offers all (as in all not some) of the same features and options as Microsoft Office? Also, yourself calling bing “fake search” is pretty sad. “Search” is a generic term just like “office suite” is a generic term. Microsoft compared your offering directly to their offering, not to office suite software in general. If you could understand that capitalized words in the middle of sentences are proper nouns, maybe you wouldn’t have made that mistake in the first place.

  29. jamesbressi

    In regards to #I think this is one of the best things to happen to you guys!The landing page needs to change. I mean my comments in the most constructive way and I want to see competition and companies like Zoho compete.The marketing copy on the landing page right now sounds a tad defensive and like Zoho is trying to prove something. Seems have NOTHING to prove, because just like you say, “you have most of the familiar functionality found in Microsoft Office, … other things Microsoft Office doesn’t offer, like the ability to easily share and edit documents online… use it for free.”You NEED to make an acronym out of “FAKE Office”… I can’t think of one right now, but even Free Ass Kickingly Effective Office would be a start ;)Run an entire campaign on this like a politician, seriously.First, the top banner needs to be changed, because the emphasis needs to be more positive “Zoho the Free Ass Kickingly Effective Office that Microsoft doesn’t want you to try” (with the f,a,k,e, emphasized some how).ALSO, you can take Microsoft’s quote and use it to your advantage:
    They said “we’re not seeing any inclination that Zoho or Google or Zimbra or any other of those offering fake Office capabilities can replace [Microsoft Office],” he [Ron Markezich, corporate VP of Microsoft Online] said.So in the copy, quote them! Microsoft’s VP of Microsoft Online said “FAKE Office capabilities can replace [Microsoft Office].”Make a comparison chart with Office that matches check for check what Zoho offers and then the one-sided Zoho checks for FREE and the ability to share and edit online, etc.Remove your line of “you have most of the familiar functionality of Microsoft Office”.This is just a start and I would be more than happy to pitch in and help and I’m sure the rest of the community wouldn’t mind lending a hand too 😉

  30. jamesbressi

    In regards to #I think this is one of the best things to happen to you guys!The landing page needs to change. I mean my comments in the most constructive way and I want to see competition and companies like Zoho compete.The marketing copy on the landing page right now sounds a tad defensive and like Zoho is trying to prove something. Seems have NOTHING to prove, because just like you say, “you have most of the familiar functionality found in Microsoft Office, … other things Microsoft Office doesn’t offer, like the ability to easily share and edit documents online… use it for free.”You NEED to make an acronym out of “FAKE Office”… I can’t think of one right now, but even Free Ass Kickingly Effective Office would be a start ;)Run an entire campaign on this like a politician, seriously.First, the top banner needs to be changed, because the emphasis needs to be more positive “Zoho the Free Ass Kickingly Effective Office that Microsoft doesn’t want you to try” (with the f,a,k,e, emphasized some how).ALSO, you can take Microsoft’s quote and use it to your advantage:
    They said “we’re not seeing any inclination that Zoho or Google or Zimbra or any other of those offering fake Office capabilities can replace [Microsoft Office],” he [Ron Markezich, corporate VP of Microsoft Online] said.So in the copy, quote them! Microsoft’s VP of Microsoft Online said “FAKE Office capabilities can replace [Microsoft Office].”Make a comparison chart with Office that matches check for check what Zoho offers and then the one-sided Zoho checks for FREE and the ability to share and edit online, etc.Remove your line of “you have most of the familiar functionality of Microsoft Office”.This is just a start and I would be more than happy to pitch in and help and I’m sure the rest of the community wouldn’t mind lending a hand too 😉

  31. Ben Meredith

    Really now… can us old salts now call Microsoft the “old OS” company? Guess we should not poke the gorilla – seems to make him jumpy.

  32. Ben Meredith

    Really now… can us old salts now call Microsoft the “old OS” company? Guess we should not poke the gorilla – seems to make him jumpy.

  33. sriram

    I think the use of the word “fake” was deliberate. By dignifying this with a response, it could lend credence to the accusation. I wouldnt be surprised if MS had a “real” vs. “fake” office ad campaign in the works.where ms has a big advantage is windows.. their “mesh.com” folder synchronization works very nicely (but I cant see how it is going to earn them revenue)

  34. sriram

    I think the use of the word “fake” was deliberate. By dignifying this with a response, it could lend credence to the accusation. I wouldnt be surprised if MS had a “real” vs. “fake” office ad campaign in the works.where ms has a big advantage is windows.. their “mesh.com” folder synchronization works very nicely (but I cant see how it is going to earn them revenue)

  35. Bala Ganesh

    Hi Sudhamshu,”I am certain none of them would stand on their own if they wouldn’t provide an option of direct import from Microsoft’s Excel or Word or Powerpoint”I think providing these options doesn’t meant they are depending of Microsoft. If they didn’t provide these options the existing user of Microsoft won’t migrate to Zoho or Google Docs

  36. Bala Ganesh

    Hi Sudhamshu,”I am certain none of them would stand on their own if they wouldn’t provide an option of direct import from Microsoft’s Excel or Word or Powerpoint”I think providing these options doesn’t meant they are depending of Microsoft. If they didn’t provide these options the existing user of Microsoft won’t migrate to Zoho or Google Docs

  37. Rajesh Kumar

    […]#…[…]

  38. Rajesh Kumar

    […]#…[…]

  39. zhanglong

    Soon,Microsoft will shake for their error.This is not their last reduction,They will have to drop their office price again and again.

  40. zhanglong

    Soon,Microsoft will shake for their error.This is not their last reduction,They will have to drop their office price again and again.

  41. Yogesh

    Microsoft has the nasty habbit of deceiving users by just showing off their products by giving them beautiful looks. They call it functionality. I don’t think anyone should come up with any particularly new functionality. A text processor is a text processor, it needs to format text in the way we want the text to be. A spreadsheet is a spreadsheet, be it microsoft, zoho or google. But I don’t see why I should pay someone so much money to get a license to use these software. Zoho or google is pretty much up to the task. I think even functionality such as pivot tables are available in these online office suites…Nothing is an emulation of Microsoft office. It’s just the way spreadsheets need to look like.. or text processors for that matter. Microsoft also should start supporting internationally accepted standards like open document formats, so that they are compatible with all operating systems.. It’s time they get a lot of things in order..

  42. Yogesh

    Microsoft has the nasty habbit of deceiving users by just showing off their products by giving them beautiful looks. They call it functionality. I don’t think anyone should come up with any particularly new functionality. A text processor is a text processor, it needs to format text in the way we want the text to be. A spreadsheet is a spreadsheet, be it microsoft, zoho or google. But I don’t see why I should pay someone so much money to get a license to use these software. Zoho or google is pretty much up to the task. I think even functionality such as pivot tables are available in these online office suites…Nothing is an emulation of Microsoft office. It’s just the way spreadsheets need to look like.. or text processors for that matter. Microsoft also should start supporting internationally accepted standards like open document formats, so that they are compatible with all operating systems.. It’s time they get a lot of things in order..

  43. Steve

    Ridiculous words driven by frustration, caused by a continuous loss of market share.
    Sorry Microsoft, there are better products out there. Should’ve not taken the users for fools, because you get companies like Zoho and Google who see that…

  44. Steve

    Ridiculous words driven by frustration, caused by a continuous loss of market share.
    Sorry Microsoft, there are better products out there. Should’ve not taken the users for fools, because you get companies like Zoho and Google who see that…

  45. Sudhamshu

    It is rather unbecoming of Microsoft to use the term “FakeOffice” when it comes to competitors such as Zoho and Google Docs. But truth be told, if not fake, these two are web emulations of the Microsoft Office. I am certain none of them would stand on their own if they wouldn’t provide an option of direct import from Microsoft’s Excel or Word or Powerpoint.
    I am even certain that most of them have to have similar functions usage as that of MS’ Excel for spreadsheets users to have a common usage on Internet as well as on the desktop. The same goes with the added features of Word. To be frank Zoho or Google Docs have not really come up with something the users can say is new to them (apart from everything being on the internet). They are only using their already acquired skills from MS Office in your tools.

  46. Sudhamshu

    It is rather unbecoming of Microsoft to use the term “FakeOffice” when it comes to competitors such as Zoho and Google Docs. But truth be told, if not fake, these two are web emulations of the Microsoft Office. I am certain none of them would stand on their own if they wouldn’t provide an option of direct import from Microsoft’s Excel or Word or Powerpoint.
    I am even certain that most of them have to have similar functions usage as that of MS’ Excel for spreadsheets users to have a common usage on Internet as well as on the desktop. The same goes with the added features of Word. To be frank Zoho or Google Docs have not really come up with something the users can say is new to them (apart from everything being on the internet). They are only using their already acquired skills from MS Office in your tools.

  47. eddihughes

    Office 2007’s UI, as well as it’s heavy weight title (resources) was what caused me to drop the suite completely. There after, I discovered OpenOffice.org. Now, I am drafting up documents in Google Apps on the fly, printing at will.The company that I work for is now testing out Zoho, so far it’s been serving us with great!

  48. eddihughes

    Office 2007’s UI, as well as it’s heavy weight title (resources) was what caused me to drop the suite completely. There after, I discovered OpenOffice.org. Now, I am drafting up documents in Google Apps on the fly, printing at will.The company that I work for is now testing out Zoho, so far it’s been serving us with great!