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Google now a serious rival to Microsoft in cloud email

Small players to be squashed as giant fatboys wrestle

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Gmail is emerging as a threat to the big boys in the enterprise email industry, despite holding just one per cent of the market and Google's refusal to tweak its service to suit individual customers. The Chocolate Factory also faces a bitter battle with Microsoft in the email cloud space - a war that could trample over other providers, an analyst has warned.

Although Google's 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.

"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 VP at Gartner.

The Chocolate Factory'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 has also dropped its cloud email venture and VMware's Zimbra is only just starting to look at businesses.

But Gmail isn't on easy street in the enterprise space yet, 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.

Gartner's tech scryer said:

Large organizations with complex email requirements, such as financial institutions, report that Google is resistant to feature requests that would be applicable to only a small segment of its customers. Banks, for example, may require surveillance capabilities that Google is unlikely to build into Gmail given the limited appeal.

As well as focusing on mass appeal, the web behemoth is also hesitant to mess around with back-end features for its enterprise clients:

While Google is good at taking direction and input on front-end features, it is more resistant to the back-end feature requests that are important to larger enterprises. Large system integrators and enterprises report that Google's lack of transparency in areas such as continuity, security and compliance can thwart deeper relationships.

Whatever its flaws though, the benefits of Google's cloud email service is turning the enterprise email industry into a two-horse race, according to Cain.

"The intense competition between Microsoft and Google will make both vendors stronger and enable them to apply cloud expertise to other enterprise cloud endeavours," he said. "The rivalry will make it difficult for other suppliers to compete directly in the cloud email and collaboration space." ®

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