In my last post I kind of took a pot shot at Microsoft’s focus on SharePoint Services, insinuating that the internal push was driven in part by competition from Google Docs and Spreadsheets. But I don’t think that Microsoft really has much to worry about. Yeah, Google Spreadsheets are still kind of kludgey. But I’m sure they’ll improve, so that’s not the reason I say this.

The thing they’re lacking is an ecosystem like Microsoft’s. Microsoft’s applications not only allow them to make money, but they allow others to leverage off their systems to make money as well. Nowhere is that more evident than Excel. I had no idea how big the Excel ecosystem was until I developed a commercial add-in for it. But if you read the Google Docs and Spreadsheets terms of service, you’ll see that Google just doesn’t get it. Here’s an excerpt:

“Subject to the Terms, Google grants you a personal, non-transferable and non-exclusive right and license to use the object code of its Software; provided that you do not (and do not allow any third party to) copy, modify, create a derivative work of, … unless such activity is expressly permitted or required by law or has been expressly authorized by Google in writing.”

Pretty scary words for an OSCON sponsor. To be fair, I don’t think many of the OSCON sponsors truly open their source code to customers, but that’s another topic. Regardless, as a developer I stay away from things that requires me to get express permission (or a lawyer) before I can touch the keyboard.

If Google really wants to challenge Microsoft, they need to provide terms of service that allow 3rd party developers to leverage off of Google Spreadsheets. And make money doing so. There’s a lot more being done with Excel then a simple grid with graphs. I’ve seen some first class database reporting tools, dashboards, financial analysis packs, statistical packages, and many other add-ins developed in Excel. These are the sorts of things that tie users to a product.

Microsoft’s web based spreadsheet is comprised of three parts - Excel Calculation Services (the engine), Excel Web Access (the browser interface), and Excel Web Services (the API). The fact that they brand the whole package as “Excel Services” shows that they “get” it. Maybe someday, Google Spreadsheets will have a friendly license, like Google Gears does. But until they do, I just don’t think they’ll never be able to fully challenge Excel.