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Google to charge small businesses for Gmail


GOOGLE has stopped offering its web-based office software, including Gmail, for free to small businesses as it aims to increase revenues outside its core web advertising business.

Previously, Google Apps, a web-based attempt to challenge to Microsoft Office’s dominance of everyday enterprise tasks such as word processing and spreadsheet editing, was free of charge to firms with 10 or fewer staff.

Google said that by charging approximately €40 per user per year, it would be able to provide better support to businesses.

“Businesses quickly outgrow the basic version and want things like 24/7 customer support and larger inboxes,” it said.

Individual consumers will still be able to use Google Apps, including Gmail and Google Drive, for free, it added, and the change will have no impact on existing business customers.

The new separation will allow Google to introduce new features, that may not be “business-ready” to its consumer products more quickly, said Clay Bavor, director of product management for Google Apps.

Google Apps, created from 2006 onwards with a series of acquisitions and new developments by Google, and using Gmail as a foundation, is used by more than five million firms according to the web giant, although it has not disclosed how many were subscribed to the free version.

Google also does not disclose the revenue the software, but the company has signalled its hopes that it will become an important part of its overall business. In July, senior executive Nikesh Arora described serving businesses as a "future growth engine" for Google. Web advertising currently accounts for virtually all Google's $38bn annual revenues.

Some advocates of web technology predicted Google Apps would quickly loosen Microsoft’s profitable stranglehold over office software, but there has been scant evidence to support them. Office remains Microsoft’s most lucrative product, with a market share of more than 90 per cent, according to industry analysts.

Microsoft has however added a range of Google Apps-style online features to its software in response to the rise of the web, however.

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By Christopher Williams Telegraph.co.uk

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