The Hidden Google Tax

This is the time when many people in the United States are receiving a federal tax refund. Many of us worked hard to get a refund, hunting down receipts, and accounting for all possible tax deductions.

No one would willingly give the IRS more than they owe, or submit to taxes they weren’t required to pay. So why is it that people and businesses allow themselves to be unfairly “taxed” by Google?

Look, I am not an accountant, and I certainly make no claims about understanding the intricacies of the US tax code. What I can tell you as someone who has worked in IT for longer than I care to admit, is that I have learned there are hidden costs when using Google Apps that are tantamount to paying a “tax”.

The “Google Tax” is unnecessary and can add up quite quickly. This is especially true when running Google Apps alongside Microsoft Office. We have our own opinions, but we also wanted to hear directly from customers who have tried Google Apps. We recently interviewed more than 90 small and medium-sized organizations using Google Apps across 5 countries, including in the US, France and Japan. Our survey uncovered some very interesting findings, including:

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  • For 9 out of 10 companies surveyed, Google Apps are used in parallel to Office. These companies have not replaced Office due to user readiness, productivity requirements, security concerns and the inability to work offline. Interestingly, Gartner confirms that the vast majority of enterprises will continue to standardize on Microsoft Office, while they only evaluate free trials of Google Apps, and do not intend to spend money on deployments.
  • Of the small and medium sized businesses that participated in our survey, most were limited to using Gmail and calendar. Only two in five adopted Google Docs and two out of three companies still use Office as their primary productivity solution.

Taxing the Business On the surface, Google Apps may seem like acceptable replacements for enterprise-grade products such as Microsoft Exchange Server or Microsoft Office. But many IT organizations have found that Google Apps bring extra, hidden costs. Organizations that have evaluated Google Apps have found that the projected versus actual costs of switching to Google Apps greatly increase their total cost of ownership (TCO). In particular, these IT organizations have found that Google Apps are not enterprise-ready and are inadequate without costly add-on applications, even for most small- and medium-sized organizations. The three general areas where organizations feel the Google Tax most strongly are deployment, IT support costs and user training.

Deployment Organizations have to first migrate employee email messages, tasks, folders, distribution lists and other data from messaging solutions such as Microsoft Exchange Server to Google Apps. Because Google Apps offer limited directory services and synchronization, the burden shifts to IT departments and end users, who often have to deploy third-party applications to synchronize data and contacts. Organizations which continue to use Outlook’s rich, familiar features have to manage several add-ons. Even with those add-ons, employees typically find themselves struggling to get their calendars and email folders to work properly, losing productivity.

IT Support Costs The time that IT people and users spend to migrate data, and the cost of third-party applications to migrate data aren’t insignificant. For example, Google Marketplace lists an Exchange to Google Apps Migrator that costs $20 per user. The cost increases greatly when people migrate data other than email. The patchwork quilt approach to shoring up Google Apps can be costly, and it fails to deliver the integrated experience most end users expect. Perhaps even more problematic for IT administrators is that Google does not offer 24x7x365 support. For instance, on weekends and holidays, you get phone support for only P1 requests, and only if more than half of your users are affected. P1 requests are critical impact items where service is unusable in production. P2 requests are high impact where service use is severely impaired. Google does not respond on weekends or holidays to either P2 requests or to lower-priority requests.

User Training Google Apps offer very basic functionality that lacks consistent document conversion and import/export capabilities. The applications have limited flexibility, and exhibit frequent feature gaps and bugs. Because Google Apps are entirely HTML-based, users can experience substantial formatting problems and potential data loss during data and document migrations and conversions. That may be why people rarely use Google Apps in isolation and why our survey found that 9 out of 10 companies used MS Office in parallel.

Benjamin Franklin once said, “The only things certain in life are death and taxes”. While that may be true, it doesn’t mean that people and businesses should have to shoulder the Google’s hidden costs. Once people see through the sales pitch, they realize just how poor the return on investment for Google Apps actually is, and why 750 million people have chosen Office to power their business.