Ballmer on Google’s Enterprise Pricing
February 9, 2009
Not long ago, I did some poking around to get a sense for Google’s pricing of the Google Search Appliance. What I discovered was that it was among the most expensive search solutions. I also learned that organizations that wanted the GSA did not seem particularly price sensitive. Google is to some synonymous with search, and the organizations that want a Google solution simply don’t think too much about the two year licensing deal, the cost of hot spares, and the fees slapped on to switch a machine from back up mode to production mode. Makes zero difference to me. Most organizations are clueless about search, and after a few months with the new search system, users are grousing again.
I was surprised with a short news story in Truemores here, however. Steve Ballmer is reported to have expressed the opinion that Google’s enterprise products and services are over priced. I wonder if he had poked into pricing for the Google Search Appliance or he was confining his remarks to the $50 per user for Google Apps. The story contained a couple of memorable comments in my opinion.
First, Mr. Ballmer is alleged to have said: “We’re not talking about some screwball consumer thing now. We’re talking about the enterprise.” I wonder if the screwball thing is the Zune or Vista?
Second, Mr. Ballmer is alleged to have suggested: “The $50 per user per year price tag on Google’s product [is] overpriced.” Maybe but I saw some hefty price tags at Office Depot on Microsoft Office today. To be fair, Microsoft deals with CALs, an acronym for wheeling and dealing for software.
If the price insensitivity I discovered transfers to Google Apps, Mr. Ballmer may have the satisfaction of knowing that he was right. Being “right”, however, does not mean that the GOOG won’t trample through Microsoft’s most best revenue vineyard.
Stephen Arnold, February 8, 2009
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