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Google Apps hits 50 MILLION VIRAL USERS

Why should Microsoft’s Office division worry about a competitor with revenues of just $50 million a year against its $10 billion a year of profit? Because the competitor, Google Apps, is easier to use, ‘good enough’ and free – and 50 million people agree. Although Google Apps has just one million paying users at $50 each a year, the free personal version is already capable enough for most users’ needs.

There’s another factor that Blodget misses: Google Apps is viral. Its online collaboration features allow multiple users to work on the same documents and spreadsheets at the same time. When you invite others to help on a doc, you’re making them Apps users. And the product is so easy and powerful they’ll soon infect others.

As Blodget says

Google Apps, in other words, still look like a classic disruptive technology.  And in their path is a massive Microsoft cash cow, one that accounts for more than half of Microsoft’s profit.