This deal is just as much about hurting Microsoft as it is about competing in the SaaS field. For $25 million, Google is acquiring DocVerse, a startup that offers a free tool for storing Office documents in a cloud.
DocVerse’s free plugin is actually a way to get more from Office. It is a plug-in that becomes part of your Word, Excel or PowerPoint menu system. You use the plugin to save your document remotely and then to keep all versions synched up, even those edited by a team member. The goal is to use DocVerse as a collaboration tool, since multiple users can rely on this software to keep their Office files up to date.
So why would Google want to own a product that makes Microsoft’s flagship product easier to use? It is certainly not from the tiny fees DocVerse will collect from power users ($5/month).
It is because Google plans to add support for Google Docs into the DocVerse feature set. And that will become a bridge to move Office users over to Google Docs.
Microsoft has announced investments in its cloud strategy that are approaching $1 billion. And its current Office business is estimated to have annual earnings in the range of $12 billion.
So this $25 million investment is a very shrewd bet by Google. DocVerse’s founding partners, Shan Sinha and Alex DeNeui explain the deal on their blog. They both worked on Office at Microsoft, so they are very familiar with the software they are now helping to undermine.