Google

Unless Microsoft can reinvent itself and do so fast it could find itself on the wrong side of history. Now, for the first time, Google is threatening the software giant’s core Office franchise.

Every 20 years or so a fundamental shift takes place in computing. The first era was mainframe computing, which was thoroughly dominated by IBM All processing was done on giant mainframes, which occupied huge, air-conditioned rooms.

Next came client server computing, an era kick-started by IBM with the introduction of the personal computer in 1981. But IBM failed to capitalise on its own invention and Microsoft cemented its dominance of computing in the two decades that followed. DOS and, later, Windows became synonymous with IT.

The next era – let’s call it the era of Web computing – is in many ways a hybrid of the two earlier models. Desktop computers will continue to become more powerful but, at the same time, intelligence is shifting on to the network as people recognise the power of the Web as a platform to do their work.

It’s early days, but Google could end up being to Microsoft what Microsoft was to IBM 20 years ago. It is not Linux and open source software that pose the greatest threat to Microsoft’s hegemony. Rather, it is companies, such as Google, that deliver software services on the Internet.

Microsoft is aware of the threat that Web computing represents. It is developing its own Web-based software services under the Live moniker.

Take a look at its website live.com for insight into how it is trying to fend off Google. But does Microsoft have the foresight to pursue the Web computing model at the expense of its Office and Windows businesses, which generate billions of dollars in profits for it each year? Live.com is not as good as Google’s Web offerings but Microsoft’s in-built desire to succeed should never be underestimated. Anyone remember Netscape?

Google is, however, the biggest threat Microsoft has had to contend with in its 31 year history. To understand the extent of the danger to the company, consider a new service launched by Google last week called Docs & Spreadsheets (see docs.google.com).

Google has integrated Writely, an online word-processing tool it acquired in March, with an online spreadsheet application. Docs & Spreadsheets is a powerful online replacement for Word and Excel. It doesn’t provide all of the functionality you’ll find in the Microsoft applications – at least not yet – but it has everything most users will ever demand of this type of software. You can even save your documents to your PC in Word or OpenOffice formats or export them as PDFs.

Think of the potential. Because your work is automatically saved on Google’s servers, you can access your documents from any device, anywhere you are, simply by using your Google login. All that’s required is a Web browser and an Internet connection.

No more e-mailing documents between home and the office. Even more exciting is the potential for collaboration. With Docs & Spreadsheets it’s easy to invite colleagues to edit documents you’ve created and, if you choose, to publish these on the Web.

Google is turning the Web into the computing platform of the future. Can Microsoft adapt and so avoid becoming the next IBM? We’ll soon know.