Does a Web Office hurt Google or MSFT?

So Microsoft seems to have finally woken up and decided to get serious about the Web — or at least semi-serious — by rolling out a cloud-computing platform called Azure and announcing the imminent arrival of Web-ized versions of its Office applications (my favourite response to these announcements came in a Twitter message from Sarah Perez of Read/Write Web). Obviously, the Web Office news is a shot across the bow of Google and its Google Docs — Microsoft is even using mostly Ajax just like Google, instead of its Flash-style Silverlight technology. But who does the rollout of a Web Office hurt Google more, or does it hurt Microsoft itself?

I don’t know the answer to that question, but I still think it’s worth asking. No doubt many users of Google Docs will shift to Microsoft’s version, in part because it will make integration with their existing corporate systems easier, or because their employers will make its use mandatory. Others may find that Microsoft’s Web apps offer better compatibility with regular Office programs (something that Google Docs still isn’t that good at, at least when it comes to advanced page layout and that sort of thing). But what about the competition between Microsoft’s Web Office and the real Office?

I would imagine that Microsoft is going to try its best to make Web Office just useful enough to entice people away from Google, but not nearly nice enough to tempt them to drop the regular installed version of Office. But no matter how hard it tries, there are likely to be small or medium-sized companies that decide it’s just as good to use the Web version as it is to pay $300 or whatever per seat to get an authorized copy of the desktop software. That’s going to be money right out of Microsoft’s pocket, since Office generates truckloads of cash for the software behemoth.

Maybe Microsoft will be able to manage the process so that it doesn’t cannibalize its Office franchise too much, or maybe it will err on the side of crippling the Web Office so that it doesn’t harm the installed software versions. But either way, that’s a tricky balance to strike.

Google: Start up those book scanners!

I just got an email from Google PR, saying the company has settled its long-running legal battle with publishers and authors over its ambitious book-scanning project, a settlement that was rumoured to be in the works for the past month or so. The project has been under a cloud since 2005, when the Association of American Publishers and the Authors Guild filed two class-action lawsuits alleging that scanning books without permission amounted to large-scale copyright infringement. The Web company said it would remove books from its index on request, but authors and publishers said this reverse-onus approach was unfair.

As part of the settlement, Google is paying $125-million to settle the legal claims, pay legal costs for the two groups, and — more importantly — will set up a new entity called the Book Rights Registry, which will be responsible for distributing payments that come from online access to books provided through Google (and through any similar programs created by other providers). The registry will also be responsible for locating rightsholders for old and out-of-print books, collecting and maintaining accurate info, and for providing a way for rightsholders to “request inclusion in or exclusion from the project.” In effect, Google is setting up a body that does what ASCAP and similar groups do for musicians.

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Nick Carr: Still wrong on Google, Part 2

I came back from a weekend away to find that Nick Carr had picked a fight with Tim O’Reilly about Google, and whether the company’s size and market power has been a result of network effects. This argument was a sort of spin-off of an issue that came up earlier in the week, when Hugh McLeod pondered the topic of “cloud computing” and whether it could produce a giant monopoly. O’Reilly argued that it likely wouldn’t, because it doesn’t benefit from network effects in the same way that Google does.

Nick took issue with this line of argument, asking:

“Is the network effect really the main engine fueling Google’s dominance of the search market? I would argue that it certainly is not.”

In fact, he says categorically that Google’s rise to dominance has “nothing to do with the network effect.”

I don’t know why a smart guy like Nick would make an argument like that, but I think he’s totally wrong. Let’s review what the network effect means: As Tim describes it, it refers to systems that “get better the more people use them,” which is a pretty good paraphrasing of the Wikipedia definition as well as other definitions you can find in various places. The classic example used is the telephone, which becomes more useful the more people use it.

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Nick Carr is wrong on Google – again

Nick Carr has a post on his Rough Type blog in which he whips up a typical sort of doomsday scenario about Google’s use of a policy called “First Click Free.” In a nutshell, this allows publishers to serve up different content to people who arrive through a Google search than they would get if they just arrived the regular way. This is bad, Nick says, because it “strengthens the advantage that [Google’s] dominance of search provides,” and thereby contributes to what he calls the “centripetal force” that Google exerts on the Web, pulling content into itself like a black hole.

To be fair to Nick, the bulk of his argument actually comes from Phillip Lenssen of Google Blogoscoped, who wrote about the First Click Free policy earlier today. Among other things, Phil said that this policy — which, as Google blogger Matt Cutts notes in a comment on Nick’s post, has actually been around for several months now — could result in more sites putting their content behind pay walls (since they could then show Google users the paid content using the First Click Free policy). As a result, he says, it could help cement Google’s dominance because it would give users of the search engine access that others wouldn’t have.

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Google phone: Will open win over closed?

There are lots of reviews of the Google phone from HTC and T-Mobile flying around, including one from Walt Mossberg of the Journal that calls the G1 a “worthy competitor” for Apple’s iPhone, and one from David Pogue at the New York Times, who correctly points out that it isn’t really *the* Google phone. It’s just one of what will presumably be many Google phones, with different features, from different manufacturers. Don’t like the side-flipping keyboard or the fact that the tilt sensor doesn’t auto-rotate the display? Maybe the next Google phone will be more to your liking.

This is already a significantly different approach to the one Apple has taken, and in many ways the blogosphere’s typical (and natural) focus on the specifics of the actual G1 device itself tends to obscure the larger picture of what Google is doing. In almost every way, the Google phone approach is open, while the Apple approach is the same as it has always been: either completely closed or very strictly controlled. That kind of focus, of course, arguably makes Apple products more appealing because the hardware, software and services are tightly integrated.

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