Google Bulks Up Software Biz; Fires Another Torpedo at Microsoft

Google is paying $625 million in cash for privately-held Postini, which makes e-mail and IM security and compliance software.  This is another significant Google commitment to hosted office apps–and another significant advance into Microsoft’s most valuable business.

For now, at Silicon Alley Insider, we exclusively use Google Docs and Spreadsheets, Gmail, and other web-based services: We don’t own a single copy of Microsoft Office and have no plans to get one.  We don’t do this out of some deep hatred for Microsoft.  We do it because Google Docs, Spreadsheets, Mail, etc., are cheap (free), convenient, and easy to collaborate with.  They often lack desirable features and have annoying network delays, but they get the job done.

Yes, it will be a while before Fortune 500 corporations ditch Microsoft for Google.  But Microsoft needs to offer a competing service to Google Docs and Spreadsheets sooner rather than later–or its major cash cow will eventually go the way of DigiCalc.

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