Google Closer to Online Word Processor - Company Buys Upstartle and Acquires Writely - Is This a Setback for Microsoft?

March 10th 2006

Writely

Google’s acquisition of Silicon Valley based Upstartle, producers of the online word processor Writely, may signal a new direction for computer users. If Google offers the service for free, they may obtain a large user base that grows each year. Insiders expect most of the larger companies to stick with what they have right now, but many small users may prefer an automatically updated word processing experience for free.

It is no secret that Google makes their money from advertising, and they do it well, Google is successful primarily because they are the number one search engine, and if you want to generate traffic, they are the solution. We expect Google to place ads on their online word processor but allow users to print the document ad-free.

Microsoft has been working feverishly to compete with Google Search. They may have been better off sticking to their core business and developing their own online version of MS Word.

We are not sure why Microsoft did not launch their own online version; maybe they concluded that their online advertising revenue was insufficient to cover expenses, or maybe they felt they needed to concentrate on search technology. Either way, many experts believe Google will eventually expand their office offerings to include a spreadsheet and possibly a database.

Recent documents, accidentally released on the Internet by Google, show that the company has ambitious plans. According to the Cable News Network (CNN), Google’s online-application strategy "will help us make the client less important...which suits our strength vis-a-vis Microsoft and is also of great value to the user....Gmail started to do this for webmail, but that's just a small first step. Infinite bandwidth will make this a reality for all applications."

Back in the 1990’s Larry Ellison, the CEO of Oracle, promoted his idea of a stripped down client that ran software stored on a larger server. This made sense because you would not need many copies of the same program on every machine. Ellison may have been a little ahead of his time.