In the wake of Google launching the Google Apps Premiere Edition there has been an avalanche of reports arm wrestling over the increased competition that Microsoft will face from the Mountain View Company. And while Google supporters see this as yet another battle won by Google in the face off with Microsoft, the Redmond Company's supporters are now playing it safe. Their approach is to downplay Google's impact with the new web-based productivity suite. Even the statement that Microsoft and Google are not competing with one another has been put forward.

In this context, you must understand that Google and Microsoft are at opposite poles as far as web-based services are concerned. While Google has adopted a software as a service strategy, Microsoft is the adept of software plus service model. This places the two companies in whole different dimensions of competition, right? Wrong! Google sees software and services as exclusive while Microsoft is developing a tandem and a synergy of the two, but as long as they share a common market and a customer pool the two companies are competing.

And Google has the upper hand. But don't trust me, let's look at the figures provided by market analyst company Nielsen//NetRatings. According to Nielsen//NetRatings, Google Docs and Spreadsheets have dominated web-based productivity tools since October 2006.

"Web-based productivity software further extends people's use of the Web browser beyond Web site visitation, and shows how the collaborative power of the Internet is bringing traditionally offline activities online," said Jon Stewart, senior analyst, Nielsen//NetRatings. "Google has capitalized on its devoted audience and wide brand recognition to gain traction quickly in this space, but there is clearly a lot of room for growth."

In October 2006, the combined audience of Google Docs and Spreadsheets accounted for no less than 445,762 unique visitors, and each visitor spent an average of 10 minutes online. Google's audience with its productivity suite made up for 92% of unique visitors and 95$ of time spent among providers of Web-based productivity tools in October.