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September 19, 2011

Google's Gmail Could Emerge as a Serious Threat to Microsoft's Enterprise Email

By Ashok Bindra, TMCnet Contributor

Gmail holds a negligible market share in comparison to Microsoft’s (News - Alert) enterprise email business, it could emerge as a threat to the software giant in the future, according to a report in UK’s The Register. An analyst warns that the Chocolate Factory also faces a bitter battle with Microsoft in the email cloud space - a war that could trample over other providers, wrote the Register’s reporter Brid-Aine Parnell.

Although Google's (News - Alert) Gmail only occupies a small slice of the enterprise email arena, it makes up nearly half of the cloud email market, which the beancounters at Gartner expect will grow rapidly in the next ten years, as reported by the Register.

“While cloud email is still in its infancy, at three to four per cent of the overall enterprise email market, we expect it to be a growth industry, reaching 20 per cent of the market by year-end 2016, and 55 per cent by year-end 2020,” said Matthew Cain, research vice president at Gartner (News - Alert), Parnell wrote.

Media reports indicate that Google’s email service is the only one to really appeal to enterprises in the last few years, apart from Microsoft Exchange, as other offerings, such as Novell GroupWise and IBM Lotus Notes/Domino, are losing momentum. Cisco (News - Alert) has also dropped its cloud email venture and VMware's Zimbra is only just starting to look at businesses.

However, analysts think that Gmail will experience many hurdles in the enterprise space because Google is resistant to providing the small tweaks that certain businesses need. The search giant tends to be a crowd-pleaser, catering to the largest segment of the market and reluctant to put in extra features to satisfy specific customers, wrote Parnell.

According to the Register’s report, large organizations with complex email requirements, such as financial institutions, are unhappy with Google’s resistant to tweak Gmail feature that would be applicable to only a small segment of its customers. For example, wrote the Register, banks may require surveillance capabilities and Google is not likely to tailor that feature into Gmail due to its limited appeal.

Meanwhile, large system integrators and enterprises are complaining that Google lacks transparency in areas such as continuity, security and compliance, which can thwart deeper relationships.

Ashok Bindra is a veteran writer and editor with more than 25 years of editorial experience covering RF/wireless technologies, semiconductors and power electronics. To read more of his articles, please visit his columnist page.

Edited by Jennifer Russell
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