What are Google’s prospects in the small business marketplace?

What are Google’s prospects in the small business marketplace? Another day, another Google announcement. Via eWeek’s Steve Bryant, comes this: “Google will announce tomorrow at the Office 2.0 conference a new product called Google Docs (docs.google.com), which will merge Writely and Google Spreadsheets into a collaboration and document management solution, according to sources.”

This is somewhat a re-announcement of products Google already offers — a “re-branding,” a “re-design” — whatever. However, the juggernaut of Google continues to roll with this announcement. As a “professional” observer of and member of the small business marketplace, I will continue to do just that, observe, how Google’s “web-apps” will blend into a suite of products that will enable a small company to operate exclusively with Google products. (Translation: Without Microsoft.) My current belief: While competition is a wonderful thing that will make both Microsoft and Google better in this arena, once a small business is up and running with a set of application tools (and most use Microsoft tools for the “office” suite functions and Intuit tools for accounting functions), they become entrenched and the cost-of-change (emotional, as well as fiscal) makes the prospects extremely daunting to the business owner.

More importanly, the “small business market” is not merely dependent on “applications” from Microsoft, but on highly-developed ecosystems of consultants and resellers and advisors who are dedicated to helping their small business clients use Microsoft or Intuit products. (An emerging “ecosystem” is developing around the use of eBay, but Microsoft and Intuit have well-oiled “symbiotic” relationships with tens of thousands of small accounting firms and IT services firms.)

Worth watching: Intuit and Google recently announced a way QuickBooks (a desktop application) users can update certain Google online applications. That is an acknowledgment by Google of a certain reality. At this point, it makes sense for Google to offer online applications that allow easy to export/import and sync features with existing desktop applications. If they can offer a simpler means than Office Live to allow browser-based collaboration on an Excel spreadsheet that, when the collaboration is complete, can be exported back onto ones desktop, then it offers them a pathway — a long and winding pathway — into the small business marketplace.

One thing is certain: Google keeps things interesting.

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