Google has teamed up with telco giant Optus to offer its Google Apps suite to SMEs, with a number of products, including video-conferencing and instant messaging, to be introduced in the second quarter of the year.
But while the move is somewhat expected given the recent trend towards software-as-a-service, one telco expert says Optus could be adopting this new program as a defence mechanism.
Telsyte research director Foad Fadaghi says telcos such as Optus may be concerned about Google’s growth, saying some telcos are concerned that Google is growing at such a fast rate with its business services it could actually end up challenging them.
Google already distributes Google Apps to several businesses in the United States, and is slowly dominating the SME SaaS market.
“Certainly under the National Broadband Network, there are some concerns among companies that stronger brands such as Google could become ISPs. So it’s interesting that a deal has been struck up and seems to play to their advantage,” he warns.
The fight is on two grounds here. Not only is Optus striking back against Telstra, which last year launched a cloud-based suite of services, but Google is also striking against cloud rival Microsoft, which powers the Telstra cloud services.
Fadaghi says there may be more at play.
“This also comes at an interesting time, given it wasn’t so long ago the chief of Optus came out and suggested some search results should be auctioned out and distributed to competitors. This deal is then interesting given that Optus seems to be threatened by Google a little.”
Optus chief executive Paul O’Sullivan told the KickStart forum on the Gold Coast last week Google should be encouraged to manage a more open platform, suggesting that traffic for search engines could even be auctioned.
But the market opportunity is ripe for both companies – SaaS is becoming more popular as companies want to trim their IT budgets.
“Overtime, this will become more mainstream. It’s a little bit early to say it’s taking over, but it’s definitely the way software offerings are going. We’re seeing a massive push from on-premise to software-as-a-service applications.”
“Whether or not that goes down to desktop apps such as Word, and other spreadsheets, we’ll wait and see. But the biggest question in my mind is, what value is Optus bringing to the table?”
“They have a large base of users, but why wouldn’t people go directly to Google?”
Optus says in its release that it will provide “tools and support” that larger businesses enjoy, and says it will also offer “business solutions, service and distribution” help to SMEs. Google also points out that businesses won’t need to worry about IT support by signing up with Optus.
Rohan Ganeson, managing director of Optus small and medium business, says customers will have access to Optus’ full support and IT help network.
“The package is specifically targeted for SMBs. Other technology companies tend to take the existing usiness models and try and make them cloud-based.”
“But we think with people using handsets, tablets and so on, the cloud becomes more important. And these apps help businesses promote themselves, and it allows us to help them as well.”
Ganeson says Optus will have access to the full portfolio of apps, but more details will be announced closer to launch.
“We would obviously market this to our existing SMB base, and there will be other opportunities at the higher end of SMBs.”
Fadaghi says.this type of customer support is good, but it’s a stronger deal for Google who have “cracked another channel to market”.
Ganeson says the idea to partner with Google is so the company can underpin its dedication to small busines – and also because it believes the apps will help small businesses.
“Our solutions can help small and medium businesses operate faster and more cost-effectively and access their vital business applications anytime, anywhere,” Ganeson says.
Pricing details will be announced closer to the product launch.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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