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Summary:

Following a string of acquisitions, new product development and vendor chest pounding this year, the cloud collaboration wars are shaping up to be a key competitive battleground. Cloud collaboration has now expanded well beyond the core of e-mail communications, giving users have more choices than ever.

Following a string of acquisitions, new product development and vendor chest pounding this year, the cloud collaboration wars are shaping up to be a key competitive battleground. Cloud computing providers are fortifying their positions, aiming to be one-stop shops for enterprises to shed internal infrastructure and move to online collaboration and communications. With this market focused heavily on software capabilities, and a healthy ecosystem of smaller players and startups filling in the gaps, watch this space carefully for more consolidation and acquisitions.

Cloud collaboration has now expanded beyond the core of e-mail communications to include social networking, group content creation and management, presentation sharing, project management, integrated voice and video, calendaring, scheduling and more. Let’s take a look at the big players and other possible entrants.

Microsoft

Microsoft is the undisputed legacy king of enterprise communications with its Exchange mail platform, which continues to hold ground in some part because so many users have been weaned on the Outlook interface. Now Microsoft has put its marketing muscle behind its Business Productivity Online suite which includes Exchange Online, SharePoint Online, Office Live Meeting, and Office Communications Online. Microsoft hosts these services, but sells them directly and through partners.

Anxious to defend its turf, the company has launched a competitor-focused website WhyMicrosoft.org WhyMicrosoft, which explicitly details the benefits of the Microsoft offering over IBM, Google Apps, OpenOffice, and interestingly, Cisco. The installed base, breadth of platform, and user-addiction factors are likely to favor Microsoft for the short term, but its leading position is by no means guaranteed.

IBM

In January, IBM hit the PR accelerator when it announced that Panasonic had chosen LotusLive, planning to eventually convert 380,000 employees to web-based mail. Claiming it as the industry’s largest cloud-computing contract, the deal gives IBM and LotusLive a renewed lease to play in the cloud collaboration space, and according to reports, also includes other online collaboration offerings such as  calendars, web meetings, file sharing, and social networking. Few companies have the size and scope of IBM to help enterprises of this size manage these implementations worldwide, so expect to see IBM continue with global deals that wrap LotusLive into a giant package of outsourced IT services.

Google

Perhaps the most exciting cloud collaboration offering from a product perspective is Google Apps, which includes Mail, Docs, Groups, Sites, and Video. While certainly lagging in some of the functionality delivered by Microsoft, Google continues to add new features at a blistering pace. The company has its own enterprise customer roster and has been actively promoting Google Apps through its Gone Google campaign.

While traditionalists claim that Google’s offerings lack the sophisticated capabilities of Exchange or Office, many see them as light years ahead on the collaboration side. Anyone who has jointly edited a Google Doc should be able to attest to that. And as the world seems to move away from the benefits of fancy font formatting to the speed and efficiency of easy sharing, Google might be in the best position to capitalize on the cloud collaboration race. But perhaps the dark horse is Google’s mobile strategy. Android and the NexusOne phone already appear to be more innovative than Windows Mobile competition, and the integration with Google Apps could dramatically accelerate business adoption.

VMware / Zimbra

VMware boldly entered the cloud collaboration race when it acquired Zimbra in January. Largely hidden within Yahoo! from its initial acquisition, Zimbra will now get the support needed to emerge on the grander stage. The Zimbra Collaboration Suite has one of the most interesting deployment models in the industry. By providing compatitibility with a variety of mail clients such as Outlook and Apple Mail, Zimbra leaps over the competition by eliminating the troublesome issue of asking users to give up their familiar mail program interfaces.

It should be noted, too, that the top three executives listed on the VMware leadership page have a combined 47 years of experience at Microsoft. These folks know how Microsoft profited from communications and collaboration products, and are likely to be in a good position to chip away at that market position.

Others

Without a formidable e-mail offering, many of the other collaboration players are relegated to fill in elsewhere. Oracle plans to develop Oracle Cloud Office following the OpenOffice aquisition through Sun to integrate desktop, web and mobile interaction. And Cisco will approach the market through its unified communications offerings and WebEx products.

Let’s also remember that collaboration habits are changing. As we move away from e-mail to other communications mechanisms like instant messaging, Facebook, and Twitter, perhaps the dominance of the e-mail core will evaporate. Salesforce.com is taking this approach with the introduction of Chatter, leapfrogging the e-mail playing field entirely to social communications.

Meanwhile, the open source and freeware worlds are waking up to the promise of online collaboration, and there are many free, standalone cloud collaboration products. We covered many useful ones here.

There is still a long road to hoe for many users to give up their affinity for Microsoft Outlook and Office. But it appears that now, more than ever, cloud collaboration could turn the tides toward a new slate of solutions.

By Gary Orenstein

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  1. Do you have any data about how the various cloud service providers treat security and data privacy and how that maps to both enterprise and consumer needs? We’ve found that an increasing number of our customers are concerned that the information that they store with a cloud provider might be compromised and they’d like to understand this risk scenario better.

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    1. Peter, Microsoft offers some security & privacy features with their BPOS suite, for example a hosted private key encryption service that helps manage compliance with data/security standards like ISO 27001, SAS 70, HIPAA, Gramm-Leach-Bliley, and others. And yesterday, they announced a “Federal” offering that will introduce things like two-factor authentication and Federal Information Security Management Act (FISMA) certification.

      http://www.microsoft.com/online/exchange-hosted-services.mspx
      http://www.informationweek.com/news/government/cloud-saas/showArticle.jhtml?articleID=223100600

      It’s also worth mentioning the Windows Azure platform, which is Microsoft’s cloud-based development platform. Software developers can build their own collaboration applications on it and deliver them to customers or their own employees. Companies like Google have similar offerings, although Microsoft has an interesting approach of integrating their cloud collaboration services (BPOS) with their cloud development platform (Windows Azure), which will create some very interesting opportunities for partners to build extensions, add-ons, and composite apps.

      http://www.windowsazure.com

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  2. Citrix!

    We had a client tell us “I want cloud computing – you know like a virtual desktop on my machine”. That client did not differentiate between his servers being in the cloud and his apps being served up on his client machines……

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  3. What about Zoho?

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  4. whymicrosoft.org doesn’t work, i suppose you meant whymicrosoft.com which redirects to
    http://sharepoint.microsoft.com/businessproductivity/why-microsoft/pages/default.aspx#fbid=hmHZ9gRF4cm

    Anyhow comparison itself is so hard to follow i can easily see a website such as whynotmicrosoft.com

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    1. Gary Orenstein Sunday, February 21, 2010

      Thanks!

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  5. Gary Orenstein Sunday, February 21, 2010

    Errol,

    Zoho is great! I did a podcast with them on The Cloud Computing Show a while back. http://bit.ly/ccshow13 Just don’t see them in the same category for enterprise mail as Exchange, Gmail, Lotus, and Zimbra. But maybe I’m not seeing something I should be.

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  6. Microsoft with Windows 7 goes a long way with Windows Live integrating their cloud into their desktop. Of course very good for users because it really makes it simple.

    However, users may not be aware that there is a choice and their own integration of course also gives them a leg up in terms of user experience, value, retention, and the ability to migrate that to other platforms (TV, Mobile, Cloud connected appliances).

    When I removed much of the “live” components from Windows 7 TCP/IP broke for me and was very hard to fix and I’m a fairly knowledgeable user. While perhaps not intended by MS, it surely has a benefit for them if people can’t remove Windows Live.

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  7. Thanks Gary!
    It’s great that, in the past few years, a lot of amazing Collaboration Suites has come up – Zimbra, Taroby http://www.taroby.com, Zoho http://www.zoho.com, VMware and lots more…
    I believe, the competition would certainly lead to the betterment of these applications in the future.

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  8. Not to forget Adobe’s acrobat.com and Beehive from Oracle. In the last 3 years, the saas collaboration space and exploded from an obscure niche to the hottest market around with offerings from Google, Microsoft, IBM, Cisco, Oracle, Adobe! At HyperOffice, we are proud to have been one of the first players in the market since 1998, and now the validation of this market with big players is certainly good for us.

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  9. Another emerging player to keep an eye on is Atmail

    http://atmail.com/

    These guys have one of the best Webmail interfaces in the industry, and also allow the option to host in the cloud or deliver as an appliance/software download.

    While the big boys like Google/IBM/Microsoft battle it out, there are also quality solutions outside the big 3

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  10. [...] Orenstein’s recent post, The Cloud Collaboration Wars Ramp Up, sets the stage: Cloud collaboration has now expanded beyond the core of e-mail communications to [...]

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