ChannelWorld

Is Microsoft’s SharePoint at Risk?

Preston Gralla is the contributing editor for Computerworld.com and the author of more than 35 books, including How the Internet Works

In several years of mostly gloomy news coming out of Microsoft headquarters in Redmond, there has been one bright spot for the company: The enterprise portal and collaboration tool SharePoint. While Windows sales have lagged, and the company’s Internet business is still heavily in the red, SharePoint is thriving and showing the kind of market growth that even a start-up would envy. But the good times may not stay around forever, particularly if
Google ever makes serious inroads into the enterprise.

Let’s start off with the good news for Microsoft. In late October, the company held its annual SharePoint conference, and it drew 8,000 attendees, up from 1,300 for the inaugural conference in 2006. Back then, Microsoft said it had 75 million licensed SharePoint users. In 2008, Microsoft reported more than 100 million users, and total SharePoint sales of more than $1 billion. In 2009, Jeff Teper, Microsoft’s corporate vice president for SharePoint, estimated that sales would be over $1.3 billion, for a growth rate of more than 20%.

Given that SharePoint was first launched in 2000, when it was called Office Server Extensions, those are pretty impressive figures — from zero to more than $1.3 billion in less than a decade. Steve Ballmer has even called SharePoint “Microsoft’s next big operating system.”

In addition, an IDC report issued in October found that 53.4% of IT professionals in its survey said their companies have already deployed SharePoint, 62.2% have already deployed it or plan to deploy it, and 70.6% have already deployed it, are committed to deploying it or will consider deploying it.

Given all that, what could be wrong? To begin with, the IDC report found that only 22% of employees in the companies surveyed were actually using SharePoint. That might mean that it might be “shelfware” -- software purchased but not used. If that’s the case, growth might be a thing of the past.

The IDC report also found that companies that use SharePoint team sites for collaboration have a difficult time managing content on the sites — 54.2% say that doing so is a tremendous challenge. That means that if simpler alternatives were available, SharePoint could be at risk.

Then, of course, there’s Google, which continues to target the enterprise. Although Google Docs doesn’t do nearly what SharePoint does, it still allows for basic collaboration. And Google has released a very early version of a more sophisticated tool, Google Wave , which is clearly aimed at workgroup, departmental and long-distance collaboration.

There is some evidence that Google is making some headway. Google claims that Google Apps is being used at 2 million companies, with 20 million active users .

This isn’t to say that SharePoint faces an imminent threat. Google Docs is still a crude collaboration tool compared to SharePoint. Google Wave may be innovative, but it doesn’t offer nearly all of the kinds of collaboration that SharePoint does. And Google, despite some headway, still hasn’t seriously cracked the enterprise market. As for a simpler collaboration tool, no serious competitor has yet materialized.

So for now it’s full speed ahead for SharePoint. Microsoft is expanding its use, pushing the company’s Business Productivity Online Suite by lowering its price and introducing it into 15 more countries -- and SharePoint is included in that suite.

But Microsoft knows that market dominance can quickly fade. There was a time, when WordPerfect was the dominant word processor, and Netscape the most popular browser. So Microsoft would do well to hold off on the champagne. If Google Docs and Google Wave take off, SharePoint could eventually be at risk.