Is Gmail ready for business?

September 3, 2009: 8:02 AM ET

Outage raises questions about Google's enterprise aspirations.

Google's Gmail has to outperform rivals. Image: Google

Google's Gmail has to outperform its competitors. Image: Google

Gmail's patrons are still cranky after the Sept. 1 outage that left them without Gmail for nearly two hours. For most users who rely on the free e-mail service, its absence -- during prime web-surfing hours no less -- was a nuisance.

But for Google's (GOOG) enterprise business, the stakes are higher. More than 1.75 million companies pay the annual $50-per-user subscription fee for their employees to use Google Apps, the web-based application suite that includes Gmail for business and other functions.

It's been two years since Google launched the product, and just this past summer it removed the term "beta," explaining Google Apps has "met or exceeded" the standards of non-beta software.

For most of Google's corporate customers, relying on software delivered as a service rather than managed internally remains a new idea, one that many are still testing. A public and lengthy outage can send a chilling effect across the industry.

E-mail outages are not uncommon

It's not that traditional e-mail services are any more reliable than services managed from the cloud. (That's the term that has arisen to describe a new computing model in which businesses rely on third parties to manage servers and deliver software.)

In fact, most e-mail goes down. According to Osterman Research, based in Black Diamond, Wash., e-mail systems in mid-size and large organizations have a mean of 53 minutes of unplanned downtime in a typical month. Add that up and it becomes 10.6 hours annually. By contrast, observers point out that Gmail has crashed only a few times this year.

But services like Gmail must outperform the traditional e-mail services if they are to win loyalty. For one, they are competing in a new industry. Many companies are still nervous about letting an outside company manage their productivity software, including something as basic -- but as crucial -- as messaging software. "When you are relying on a third party to get that access, you lose that level of control," explains Forrester Research analyst Sheri McLeish. "Whose neck do you wring?"

Carrying the torch for "cloud computing?"

Also, when companies buy their software as a service, making monthly payments rather than one lump investment, it's easier for them to switch if they grow frustrated with the product. More traditional software is so expensive to purchase and to maintain that even when it becomes onerous, people stick with it.

Google did the right thing by reacting immediately and with maximum transparency. Google's Site Reliability Czar, Ben Treynor apologized on the company blog and called the event a "Big Deal," capitalizing the letters in the phrase.

He explained exactly why it happened, saying it was caused by a miscalculation when a few servers were taken offline for upgrades, causing a disturbance in the force.

But an apology might not be enough in the long run. Says McLeish, "They'll have a much harder time attracting businesses. It isn't just one outage for Google. This was similar to a prior outing … in the business world there are penalties for this."

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About This Author
Jessi Hempel
Jessi Hempel
Senior Writer, Fortune

Jessi Hempel is a New York-based technology writer for Fortune. She has written extensively about digital media, online advertising and social networking. Before joining Fortune in July 2007, Hempel worked at BusinessWeek and most recently served as their innovation department editor. Hempel is a graduate of Brown University and received a Masters in Journalism from The University of California at Berkeley.

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