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Microsoft confirmed today a widely circulated rumor and announced, with gran fanfare, that next year they will be announcing a web-based version of their Office product. Yes, you read it right, Microsoft announced that they will be announcing… You can read the full story in PC Magazine, ComputerWorld and many other publications.

The question for many will be… what does this announcement of an announcement means for Zoho and other SaaS vendors? It’s simple: it means two things.

First, it means fantastic news. Microsoft had been pooh-poohing the whole SaaS world… even going as far as denying the inevitable and creating its own Software-plus-Services trend-of-one. But Microsoft took one big step forward today, and added some extra validation to the whole concept of productivity applications delivered using nothing but a browser.

Second -and particularly to Zoho- it means business at usual. Will there be increased competition in the on-line productivity space? You betcha. But it’s not like we had a monopoly on that market to start with. We thrive on competition. We have multiple competitors for each and every one of the 19 (and counting!) different services we provide. That only makes us better. But beyond that, our users get value from having so many tightly-integrated SaaS applications. Zoho is much more than the on-line productivity suite. We have the most comprehensive portfolio of on-line productivity and business applications.

Maybe the real question is – what will this mean for Microsoft? What will this mean for their business model and their uses?

For their business model – I wonder if they’ll charge the same for the on-line version as they charge for the old, dinosauric version? Are they still going to be able to collect the absurdly high CAL fees for office users? They surely risk loosing a grip on the desktop, as well, you don’t need Windows to run applications on a browser.

In any case, and beyond the business implications – let’s see how this works for the most important folks on earth: users. If Microsoft MSN Live Search, Microsoft MSN Live HotMail and a host of other Microsoft on-line products are a proof of Microsoft’s Internet prowess…

Microsoft, welcome to the SaaS world. See you in a year (or so).

Rodrigo Vaca

ps. I’m taking bets on the simple and elegant name the Microsoft on-line office will get. I’m betting on: Microsoft Office Live 2010 Standard Web Edition.

  1. Rodrigo Vaca

    Neil -Wise words. I didn’t mean to imply that they will walk away from the ‘Software + Services’ strategy – they’ll continue to push on that and somehow lock in people back to the desktop… just like SQLServer supports 36 different operating systems (but of course, they all start with ‘Windows’)!Still, it is refreshing to see them embracing the software-in-the-browser trend, regardless of the name you want to use for that. As the industry starts to converge and settle into one ‘model’, that can only benefit customers in the long run. I’d use the Beta vs. VHS analogy (or HD DVD vs BluRay for those not old enough).You’re totally right – at the end is has to all about customers. But that goes beyond just marketing and blogs – providing products, technology and innovation that solves their problems at an affordable price. That’s what we’re trying to do here at Zoho.Thanks for your thoughts, keep them coming!Rodrigo

  2. Rodrigo Vaca

    Neil -Wise words. I didn’t mean to imply that they will walk away from the ‘Software + Services’ strategy – they’ll continue to push on that and somehow lock in people back to the desktop… just like SQLServer supports 36 different operating systems (but of course, they all start with ‘Windows’)!Still, it is refreshing to see them embracing the software-in-the-browser trend, regardless of the name you want to use for that. As the industry starts to converge and settle into one ‘model’, that can only benefit customers in the long run. I’d use the Beta vs. VHS analogy (or HD DVD vs BluRay for those not old enough).You’re totally right – at the end is has to all about customers. But that goes beyond just marketing and blogs – providing products, technology and innovation that solves their problems at an affordable price. That’s what we’re trying to do here at Zoho.Thanks for your thoughts, keep them coming!Rodrigo

  3. Sridhar Vembu

    Neil, thanks for your words of caution. We were just having a little fun for a day – it is Microsoft after all, the most powerful company on the planet. We are very focused on customers here at Zoho. We are very focused on meeting their needs.Sridhar

  4. Sridhar Vembu

    Neil, thanks for your words of caution. We were just having a little fun for a day – it is Microsoft after all, the most powerful company on the planet. We are very focused on customers here at Zoho. We are very focused on meeting their needs.Sridhar

  5. Jeevan

    @ Neil Ward-Dutton,The argument seems utterly ludicrous to me!Why?Allow me to be blunt here. If Zoho coming out of India, which is one of the poor nations on planet (per capita income < 1000 USD) can develop a Word Processor software within 10/20 USD by Indian developers who themselves take a lot less compared to any other developer in the “first world”, thenWhy not Microsoft (MS) coming out of the USA, one the richest nation on planet and not to mention MS itself sitting on huge cashpile CAN NOT PRODUCE a word processing software which is cheap??? I dare MS that it even can not match Zoho with that price itself.Why I put it? The other day I called up MS Support thinking that my team will use MS Project. When they informed that single user license is 40, 000+ INR = (approx) 1,000 USD, I just dropped my call! Actually my jaws dropped after I checked their trial version. That amount of money for the functionality they have provided is truly vulgar!

  6. Jeevan

    @ Neil Ward-Dutton,The argument seems utterly ludicrous to me!Why?Allow me to be blunt here. If Zoho coming out of India, which is one of the poor nations on planet (per capita income < 1000 USD) can develop a Word Processor software within 10/20 USD by Indian developers who themselves take a lot less compared to any other developer in the “first world”, thenWhy not Microsoft (MS) coming out of the USA, one the richest nation on planet and not to mention MS itself sitting on huge cashpile CAN NOT PRODUCE a word processing software which is cheap??? I dare MS that it even can not match Zoho with that price itself.Why I put it? The other day I called up MS Support thinking that my team will use MS Project. When they informed that single user license is 40, 000+ INR = (approx) 1,000 USD, I just dropped my call! Actually my jaws dropped after I checked their trial version. That amount of money for the functionality they have provided is truly vulgar!

  7. Neil Ward-Dutton

    Rodrigo,
    Some good food for thought there. However I think it’s a little disingenuous to imply that MS is somehow walking away from the Software + Services story – in fact it’s making clear that it’s continuing to push forward with its on-premise apps investments and technologies, as well as starting to do stuff “in the cloud” (or at least, announcing it ;-)One other thing: I’ve been watching the software industry for about 15 years now, and one thing that is very clear to me is that there’s a limit to how much you should spend your time talking about your competitors. Sun fell foul of this for a long time, with McNealy always spending too much energy bashing MS and not enough energy talking about how Sun was going to help customers in the future.Please don’t get seduced into going down that route. It’s fun to talk about how far “behind” you MS is, I can see that, but ultimately Zoho should be talking about customer needs and how you meet those – not inviting prospects to think about what MS is doing.Just my 2c.

  8. Neil Ward-Dutton

    Rodrigo,
    Some good food for thought there. However I think it’s a little disingenuous to imply that MS is somehow walking away from the Software + Services story – in fact it’s making clear that it’s continuing to push forward with its on-premise apps investments and technologies, as well as starting to do stuff “in the cloud” (or at least, announcing it ;-)One other thing: I’ve been watching the software industry for about 15 years now, and one thing that is very clear to me is that there’s a limit to how much you should spend your time talking about your competitors. Sun fell foul of this for a long time, with McNealy always spending too much energy bashing MS and not enough energy talking about how Sun was going to help customers in the future.Please don’t get seduced into going down that route. It’s fun to talk about how far “behind” you MS is, I can see that, but ultimately Zoho should be talking about customer needs and how you meet those – not inviting prospects to think about what MS is doing.Just my 2c.

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