Google may ultimately find itself competing against a more functional hybrid product model that lets customers leverage the advantages of the cloud from the comfort of their familiar Windows-plus-Office environment. (That’s where Office Live seems to be heading: an adjunct to the traditional desktop-bound Office.) Ironically, the major interface redo of Windows Vista and Office 2007, plus IT grumbles about Office 2007’s instability, give Google an opening to redirect those IT investments away from the now-less-familiar Microsoft offering.

But Google faces a more pressing concern: Despite all the hype surrounding its Gears technology, which lets you save files locally, and Google Apps initiatives, the fact remains that none of this stuff works very well. Yes, there are exceptions -- Gmail being the oft-cited example -- but taken as a whole these offerings pale in comparison to the current state of desktop applications. When something as innocuous as accidentally hitting the F5 key can destroy your magnum opus, you know a technology is simply not ready for prime time. (Yes, this has been fixed, but it shows the immaturity in much of Google Apps.)

We all know that Microsoft also stumbles through its offerings, requiring several versions to deliver highly useful, largely stable apps. So it’s easy to imagine Google going through the same “long march” strategy and ultimately outpacing Microsoft. But it’s a shame that it doesn’t shorten the march by avoiding the stumbles to begin with.

First Google needs to shore up its current offerings. Offline access and persistence are two huge technical hurdles that Google has only recently begun to address with its Gears initiative. It needs to expand this functionality to the Documents, Spreadsheets, and Presentations apps -- and do so quickly. But the company’s recent Android project has stolen much the limelight away from the whole Google Apps initiative. That could take Google’s eye off the Office prize. Google executives need to refocus on the bigger quest, dethroning Microsoft, and not let too many major initiatives get in each other’s way. Google also needs to avoid getting too caught up in myriad side projects that may have a limited return on investment.

Google can’t do all this alone. The company can hire as much über-talent as it wants, but that won’t fix the fundamental issue that the Web is not a monolith that one company can control. You win by being part of a great team that together delivers the best results and has financial interests in seeing the team succeed. This is where Google’s paucity of ISVs is a real problem. It takes more than vision to change the world. It takes incentive, and for Google that means growing a real developer channel, one that can translate all of the cool Google technology into innovative, commercial applications that address real customer requirements.

If and when Google can bring such an ecosystem to life, it might actually have a chance at dethroning the Office king.

Why Microsoft is hard to beat
Embrace and extend. For better or worse, this has been Microsoft's modus operandi for more than a decade. Company strategists identify an emerging standard, publicly pledge support for it, then flood the marketplace with all sorts of proprietary extensions to “improve” the standard.

In some cases, it actually works out for the better. Key hardware technologies, such as the ACPI (Advanced Configuration and Power Interface), owe their existence to Microsoft's push to improve the Windows platform’s compatibility and stability. In many other cases, however, the company's embrace–and-extend moves have had disastrous consequences. The browser wars of the late 1990s were the direct result of Microsoft's attempts to squash Netscape by forcing developers to choose between incompatible HTML tag and plug-in standards.