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General Motors is close to signing a deal with Google to move more than 100,000 employees to Gmail and Google Apps.The Wall Street Journal reports that the deal has been signed but is not final yet because Google still has to meet certain conditions from GM.
But if Google gets the deal, it would be one of the biggest and highest profile companies to deploy Google Apps in its more than five years on the market.
It would also be a big blow to Microsoft.
For the last decade or so, the company has had a lot of success selling Exchange Server to customers on ageing email systems like Lotus Notes (which is what GM uses, according to the Journal report).
A couple years ago, Microsoft began seeing competition from Google Apps in those accounts, and it has made a big move into the cloud to counter that competition. Earlier this year, it rolled out Office 365, which includes a cloud-based version of Exchange, and Steve Ballmer recently boasted that Microsoft usually wins big accounts when it goes head to head with Google.
But GM is particularly cost conscious, and Google is probably willing to cut aggressive deals on Gmail because it’s not a core part of the company’s business — its non-advertising businesses accounted for only $385 million in revenue last quarter, which is less than 4% of the company’s total.
By way of comparison, Microsoft’s Business Division — in which Exchange and Office 365 live — has been its main growth driver for the last year, and earned about $3.7 billion on $5.6 billion in sales last quarter.
Google would not comment on the report.
Microsoft pointed to a statement by a GM spokesperson to the Journal saying that the company has “not made a decision to deploy Google Apps. We’re always looking for leading-edge technologies, and our [information technology] department is open to various developers.”