Online Office apps: Challenges/Misconception and Future

Office 2.0 battle is heating up. And we are launching a series of post covering the challenges in online office suite of products, new developments as well as review of online office products.

What’s office 2.0 and why the heck are we taking it online?

Wikipedia defines office 2.0 as :

“A web office is a set of applications hosted on a server that enable users to create, edit and share information. The data resides on a web server, and is a move towards cloud computing. It is a derivative of the Desktop Office Suite, but has more collaboration capabilities due to its Web nature.”

The keywords are: hosted app, data resides on web server & collaboration

Online office (a.k.a office 2.0), instead of being a pure alternative to MS office is rather an attempt to enhance productivity and collaboration among teams.

Is it fair to call online office an AJAXified version of Desktop office?
Not really.

Why is Office 2.0 considered sexy?

Because Microsoft Office can suck your pocket (and everything else..). Leaving all the “sexy” reasons (like AJAXified UI) aside, Office 2.0 drastically reduces the TCO (Total Cost of Ownership) of the product.

Look at it this way – each license of MS Office costs $400+, and you also need to have a dedicated IS for maintaining the licenses/servers etc. On the other hand,online office is stripped of all these constraints.
You don’t need to worry about the licensing cost, and you don’t even need to maintain your own servers (and a dedicated system admin team)

Another major USP of office 2.0 is that it enhances collaboration. As companies expand and embrace global workforces, we see overloads of email/IM/conf calls; or put it other way, overload is an indicator of communication failure (don’t we see the same doc being emailed a number of times?).

Online office simplifies the collaboration effort by breaking collaboration at a granular level – i.e. have an online repository of the doc with a permission list (that can be defined ‘on-the-fly).

Challenges in Office 2.0 adoption?

Like any new product, Office 2.0 apps demand a significant change in user behavior and hence slow with adoption. As far as businesses are concerned, enterprise adoption is the toughest nut to crack, since most of the buying decisions are made by CIOs/IT decision makers who I am sure will not even think about Online office before 2008.

All said and done, online office will see the initial adopters in SMBs and SOHOs; fueled by increasing broadband penetration and exposure to RIAs.

Having said that, one of the biggest hurdle in online office business is the distribution of these apps. Companies like Google and Microsoft will cash on their brand name and partnerships, but it would be interesting to see how other players like Zoho create awareness of their offerings.


TechCrunch reported sometime back about SOX (Sarbanes-Oxley act) compliance concern with Office 2.0 apps. That’s not at all a valid point, since SOX doesn’t mandate you to keep your records in your own servers (if that’s the case, would have gone bust).

What’s next from us? Review of online office products and strategic overview of key players in the market.

Tell us what do you want to see specifically about online office apps.
, office 2.0

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