GM is latest battleground between Microsoft Office and Google Apps

If the automaker moves 100,000 users from Notes to Google Apps, that would be huge -- but that's a big if in a competition with murky numbers all around

For several years, Google has been trying to muscle Microsoft out of its office productivity stronghold, pushing Google Apps as a replacement for Microsoft Office. The two companies regularly trade insults on each other's offerings, but Microsoft has felt the threat enough to roll out Office 365, its own cloud-based office producivity suite. The battle got bigger since Friday, when the Wall Street Journal reported that Google has signed a deal to move 100,000 General Motors employees (not quite half the workforce) from Lotus Notes to Google Apps, "according to people familiar with the matter."

But the truth is not so simple: GM now says it is only studying the use of Google Apps and has reached out to Microsoft to say it has made no decision, perhaps in an attempt to play the two companies against each other as it seeks to dump IBM's Lotus Notes.

If GM were to deploy Google Apps to the 100,000 seats it has apparently contracted to study, it would be a huge win for Google. No other customer approaches that scale: The City of Los Angeles signed a contract for 30,000 Google Apps seats two years ago, but only 17,000 seats have been rolled out, with the LAPD still stalling. Genentech has about 15,000 users; KLM about 11,000 users, Valeo about 30,000, the U.S. General Services Administration about 17,000, and Rentokil about 35,000.

Microsoft doesn't flaunt its Office 365 customer list as readily as Google does for its Apps. In fact, Office 365 sales figures are one of Redmond's most closely guarded secrets. Last week attendees at the Exchange Connections conference heard Kevin Allison, Microsoft's general manager for Exchange, say that 20 percent of the Fortune 500 have bought Office 365 seats. But he studiously avoided mentioning how many seats or which companies.

Last month Microsoft CEO Steve Ballmer, speaking at the Web 2.0 conference, said, "When it comes to enterprises moving into the cloud ... we are winning, winning, winning, winning, winning." He stressed that in the battle for online apps, Microsoft is "beating Google 98 percent of the time."

Of course, what's lacking are numbers, numbers, numbers.

Google is hitting Microsoft where it hurts. At $5 a head (probably heavily discounted for GM), the income for Google hardly rates a raised eyebrow. But Microsoft can't afford to lose too many 100,000-seat Office contracts, at any price.

This story, "GM is latest battleground between Microsoft Office and Google Apps," was originally published at Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow on Twitter.

Copyright © 2011 IDG Communications, Inc.