Google Apps has been around for almost five years, and the company claims 30 million end users at 3 million businesses are using it.
But those statistics are too vague to show whether the product is actually successful — many of those customers may be conducting limited trials or using the free version.
But new study released today from systems integrator White Stratus, a Google Apps reseller, offers concrete proof that the product is getting real traction among large businesses.
In January and February, White Stratus surveyed 2,030 U.S. companies with more than 250 employees, and talked in depth to 232 IT departments selected randomly from those companies. Here’s a summary of what they found:
- Google Apps is getting popular. Almost 20% of the companies surveyed have deployed Google Apps in some form.
- Especially among big companies. Penetration was highest among companies with more than 10,000 employees — this contradicts the conventional wisdom that Apps is only for smaller businesses.
- It’s not just pilots. Of these Google Apps customers, about one-third of IT department heads surveyed said that they were using Google Apps throughout their organisation — not just in pilot programs.
- It’s huge in education. Google Apps was most popular by far in the education industry, with nearly 60% penetration. But it’s also gaining traction in media companies, professional services, and utilities.
Click through to see more details from the study.
White Stratus looked at 2,030 U.S. companies with 250 more employees and compared them against Google Apps domain registrations. They found that nearly 20% of these companies had deployed Google Apps in some form.
Surprisingly, penetration was highest in companies with more than 10,000 employees. This contradicts the conventional wisdom that Google Apps is only for smaller companies. In fact, it's probably easier for companies with large IT departments to conduct a trial of a relatively new product, while smaller IT departments are likely to stick with what they have -- probably Microsoft Office and an on-premise e-mail system.
For this part of the survey, White Stratus randomly selected 263 IT departments from the group and surveyed their senior members via phone. Of the companies within that sample who had deployed Google Apps, 32.8% of IT respondents said it was deployed throughout the organisation, 47.8% said it was only a pilot, and the remainder said they weren't aware it had been deployed at all, suggesting that an employee or department set up a trial without informing IT.
Of the IT departments surveyed who used Google Apps, 64% only deployed the core suite components that are installed by default -- Docs, Calendar, Sites, and Video. 35% also deployed Gmail, which requires a much bigger time commitment. These could be considered 'serious' Google Apps customers.
Google Apps' penetration is very high in educational institutions, where IT costs are constrained -- software as a service reduces IT costs because there's no need to install and maintain software on premises -- and the risk of losing business because of an outage is low.
After Windows, Office and enterprise software make up the bulk of Microsoft's revenue and profit. So the fact that large enterprises are deploying Google Apps is good reason for Microsoft to worry.
Now we know why companies considering Google reportedly get special attention from Microsoft's sales force, why Steve Ballmer paid a personal sales call to the Department of the Interior when they were considering Google and convinced them to stick with Microsoft, and why the company has been on a pretty aggressive marketing campaign to highlight companies that switched back to Microsoft after considering Google. (Although frankly most of Microsoft's case studies so far have been a bit weak -- most of the switchers are small companies who only piloted Google Apps, while Google has some much larger customers who made the switch from Microsoft.)
Microsoft announced its latest answer to Apps, a suite of online services called Office 365, last October, but the services aren't set to go live until later this year. In the meantime, Google keeps chipping away.