Google has announced a free software plugin for Microsoft Office that will tie your Google Docs account to Microsoft Office. This gives you access to the power of the cloud while letting you stick with the software you’re used to. The plugin is called Cloud Connect and goes into live preview (sign-up) for Apps for Business customers today. Everyone else should get it soon.

Editing a document in Word? It’ll automatically sync to your Google Docs account each time you hit ‘Save’. Want to share a preview of your document without worrying about what file format your coworkers can open? Just send them a link to the Google Docs file. The plugin supports Microsoft Word, PowerPoint, and Excel, and it’s a big deal for Google’s strategy with Docs.

You may recall that the latest versions of Microsoft Office do embrace the cloud, but that’s only for those on the cutting edge of Office products. For everyone else, Google’s Cloud Connect provides a practical solution as it supports Office 2003, 2007, and 2010. It’s also simpler as there is no SharePoint configuration required. Google also supports Excel, which Microsoft does not yet.

New York City Mayor Michael Bloomberg and Microsoft CEO Steve Ballmer announced Wednesday morning a large-scale IT agreement will deliver Microsoft cloud computing services to 30,000 city employees while also consolidating the city’s licensing agreements into a single, unified system.

The agreement will replace the city’s prior licensing arrangements, which were conducted individually by city agencies, and according to Bloomberg, were “complicated, cumbersome, and needless to say, not very cost effective.” The mayor said the agreement will yield significant savings for the city going forward. “Central to this partnership is a new licensing agreement — the first of its kind — we think in the nation, which will produce more than $50 million in savings for the city in the next five years,” Bloomberg said in a news conference.

The agreement will allow the city to leverage its buying power to consolidate agreements into one single, multi-year licensing contract that will be made available to more than 100,000 city employees.

Microsoft made its long-awaited move to package the hosted version of Office with the hosted versions of Lync, SharePoint and Exchange with the unveiling on Tuesday of Office 365.

Office 365, scheduled to ship next year, is now available in limited beta form in 13 countries and regions and includes Office Web Apps, Exchange Online, SharePoint Online, and Lync Online.

Office 365 for companies with fewer than 25 employees will cost $6 per user per month. For larger organizations, Microsoft will offer additional options, including the first time Office Professional Plus on a subscription basis for $24 per user per month.

As Google looks to assure potential business customers that its cloud-based suite of applications is a worthy alternative to on-premises solutions, it's getting help from independent service providers.

One example is Backupify, an online backup, archiving and export service that unveiled support for Google Apps this week.

Cambridge, MA-based Backupify said it automatically backs up all data stored in a user's Gmail, Google Docs, Google Calendar, Google Contacts and Google Sites account. Google's (NASDAQ: GOOG) cloud-based system stores users files, but Backupify said its system ensures data won't be lost by error. Backupify actually leverages another cloud service, Amazon's storage cloud storage, to backup files.

One of the virtues of using Google’s products are the connections you get to the search giant’s other applications. For example, I love that my Gmail account can connect to iGoogle, YouTube, Blogger, Picasa, and other products in the Google family, making the transition between applications seamless and easy. Google is now planning to bring this interconnectivity to Google Apps. 

Google says 9 of the top 20 requests from Apps customers are for their accounts to work with more services from Google. Currently, Apps works with Gmail, Docs, Chat, Groups, Video and Calendar. Later this year, Google will roll out functionality with Apps for Picasa, Google Reader, AdWords, News, Finance, and other products. Users won’t need to switch between their personal and work account to interact with these products from within the Apps interface.

Google says that all “Standard, Premier and Education Edition customers will be moved to the new infrastructure that enables this change in the fall, and customers who would like more control over the timing of this change will be able to make the switch voluntarily during the summer.”

This is a huge bonus for the functionality of Google Apps considering the popularity of the applications that it will be integrating. It certainly ups the ante in the ongoing Microsoft-Google productivity suite wars.

Google has announced a series of updates to Google Docs which are sure to please everyone who relies on the free cloud-based service. The documents editor received additions such as a margin ruler, tab stops, comments, a re-worked system for placing and maintaining bullets and numbers and support for real-time collaboration of up to 50 people. Spreadsheets now allows for cells to be edited from the forumla bar, the use of auto-fill and the dragging and dropping of columns. Overall, everything is said to be much faster, smoother and intuitive. There’s a whole bunch of other changes we haven’t gone over, so why not hit up the jump to watch a quick little into video and then explore the service for yourself? We’re loving the realtime collaboration improvements.

 

 

Microsoft (MSFT) is still fumbling as it tries to navigate its way out of the innovator’s dilemma. The business was built and nurtured on its lucrative suite of Office products— unfortunately, that reliance on Office is now complicating its full migration to cloud computing. Today, we spoke to Senior Vice President Chris Capossela, who acknowledged the challenge of growing profits without pay-to-install software.

Microsoft is gearing up for the launch of Office 2010 (available to businesses on May 12 and to the casual consumer in June), marking the first time the software giant will release free web versions of Office applications like Word and Excel bundled into Windows Live.

Now that consumers can get these basic applications for free, the company is hoping that pay add-on features will be enough to override the loss. Last week, the president of Microsoft’s business division, Stephen Elop, optimistically told us that while profit margins could (let’s be honest, they will) shrink, overall profits could be supported by new add-ons.

Deploying Google’s Gmail for my internet marketing business has allowed minimal and secure IT administration of my 8 websites (28+ email accounts). Supporting a mixed operating environment which includes Microsoft, Ubuntu and MacOS, multiple browsers, and document file formats from Microsoft Office, Open Office is made possible and easier with an in-the-cloud computing environment like Gmail.

So why would you consider cloud computing like Google Mail for your business, especially an SME (small medium enterprise)?

In a two words – security and compliance. E-mail security, web security and message compliance are the underlying benefits to solid business reasons to have your mail and office documents served through Gmail.

Google Friday reportedly shelled out somewhere between $25 million and $30 million for DocVerse, the almost three-year-old start-up that was obviously born to go to Google. TechCrunch expected the deal to close in December.

DocVerse will let Google Apps users share, edit, collaborate on and save offline-created Microsoft Word, PowerPoint and Excel documents in the cloud. It syncs the online and offline documents so all modifications are in parallel and allows users to make running comments.

Google Apps needs such widgetry, although users sometimes complain of it being dicey, if it hopes to strike a more even balance between its two million business users and Microsoft's 500 million-600 million Office users.

Google has responded to anger over its Buzz social network with an apology and second round of privacy-related changes.

The latest move replaces the controversial "auto-follow" feature with something Google calls "auto-suggest."

Saturday's revision was the second major change to Buzz since the service was introduced last Tuesday. Since then, Google had been besieged by complaints that Buzz endangers user privacy.