Google's repackaged messaging services could do to email security what Wal-Mart did to retail, according to analysts. That could be good news for customers and bad news for the competition.
"It establishes a fairly aggressive new pricing cellar for hosted email services," particularly around spam and virus, as well as archiving," said Matt Cain, vice president and email analyst with Stamford, Conn.-based Gartner Inc. "They're applying a lot of pressure. It starts to change the price equation for on premise versus in the cloud security."
Google's new packages come about seven months after the Internet giant announced acquisition of Postini, one of the leaders in managed email security services. It's streamlining Postini's assorted services into three basic bundles, leveraging its more than ample resources to offer more for less.
"Google is taking advantage of its scale and computing power to deliver well-defined packages that solve security and compliance message problems," said Sundar Raghavan, a former Postini vice president, now Google product marketing manager. "For example, Postini archiving was $70 a seat--maybe $100 by the time you included everything. It's down to $25 with no capacity limit."
The new lineup of services starts with Google Message Filtering, which provides core antispam and antimalware services for $3 per user.
"Google is wise to break out core antivirus and antispam, determining there's a market for just those services," said Cain.
Message Security adds outbound message inspection and content policy management. Message Discovery adds a year of archiving, retention and e-discovery for $25.
Customers will be able to buy the services through partners or directly online from Google. The new bundles replace Postini's menu for new customers and will be offered as a migration path to existing Postini customers, typically as their contracts come up for renewal.
Google is positioning the lineup as part of its Google Apps offerings, but that may be more marketing than substance. Raghavan hopes that security customers will eventually start to migrate to Google's collaboration, Gtalk, calendar, documents and Gmail tools, but this may be wishful thinking. Cain concedes Google is clever in telling Postini customers they are now Google apps customers, but "it's quite a stretch, at least in the short term" that they will go from antispam to collaboration.
The bottom line: Google is in a position to undercut the competition and still make money, according to analysts. It presents a challenge to service provider competitors like MessageLabs, and challenges hardware vendors like Cisco and Secure Computing, who acquired industry leaders IronPort and CipherTrust.
"In general, we thought before it was kind of a wash between license fees to those guys [email security product vendors] versus what you pay in the cloud," said Cain. This puts an additional onus on Cisco via IronPort to be more aggressive on the hosted side."