Google “Office” closer to reality?

The YouTube deal takes all the headlines, but Google has just merged Writely and Google Spreadsheets into Google Docs & Spreadsheets (http://docs.google.com). Some details and a brief review in this blog post (http://blog.outer-court.com/archive/2006-10-11-n18.html).

There really isn’t any obvious connection with online revenues with this development, other than speculating on Google’s plans with this product. Like most such product launches from Google, we are left with more questions than answers.

- How does Google plan to monetize this service, even while they try to get their hands around the world’s information? Would they even try to monetize this with contextual advertising, which has been their approach so far?
- How does Google Docs tie in with Gmail and Google Talk?
- The fact that it is compatible with MS Word and Excel and one can import and export documents from these is certainly welcome. Will compatibility be an issue with future versions of the MS products?

My initial thinking was whether companies or individuals would really be comfortable putting up important work documents or sensitive personal information online. But then the same concerns are applicable to web-based e-mail or e-commerce transactions, and consumers seemed to have adapted. So, may be with time, even this could find acceptance.

MS Office 2007 and the Vista OS are scheduled for release very shortly; will Google’s release of Docs & Spreadsheet have any bearing on the take up on the former? Probably very unlikely, but something to look out for.

The main question I had though is this: what is the real value proposition? As a user, I couldn’t figure out how beneficial this is going to be.

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