How Cisco Can Give Microsoft A Run For Its Money

(MoneyWatch)  Google and Cisco each have a collaboration suite they would like to use as a club against Microsoft, but neither is close to dislodging Microsoft from the center of the productivity software universe. Microsoft's armor: having turned its Outlook email client into the hub of enterprise workflow and business processes.

Email clients are the nexus of calendars, to-dos, task lists, mail-merge programs, not to mention document attachments and a whole host of applications that bind users to Microsoft Office programs. And speaking of binding, it's that compound document structure Microsoft created -- and which is the target of a patent lawsuit Microsoft may well lose -- that uses the proprietary Open Office XML (OOXML) document format to bind embedded business processes into the documents.

Google acquired email security and compliance software vendor Postini in 2007, but only recently realized the importance of Outlook specifically, and thus created an Outlook connector for Google Apps this year; the lack of backwards-compatibility with existing shared documents, however, is still preventing Google from gaining traction in the collaboration space.

Cisco, which is using collaboration as its new shibboleth to the enterprise for everything from routers to videoconferencing, can buy all the security and collaboration technology it wants (and it has), but it can't go anywhere without a real email play. And it can't be just any email play ?€"- even IBM has better luck selling Lotus Sametime as a collaboration tool connected to Exchange than as a tandem with its Domino email server. Anyone wanting to challenge Microsoft on the desktop needs an email play that promises integration with existing Microsoft Office documents.

But there's one viable email play out there for the taking -- Yahoo has put it up for sale -- and Microsoft has its fingers crossed that someone like Cisco doesn't snap it up. And that play is Zimbra. In fact, until it was snapped up by Yahoo in one of the most egregious examples of cultural misalignments, Zimbra enterprise email was considered a serious challenger to both Exchange and Domino precisely because its developers had been able to penetrate Microsoft's proprietary code and translate those business processes and workflows embedded in Office documents that are so critical to Microsoft's staying power.

Gary Edwards, former executive director of the Open Document Foundation, told me that the backwards compatibility of Microsoft's on- and offline SharePoint and Office 2010 products with previous desktop versions "is the Microsoft secret that's got a barrier so high that Google can't overcome it."

According to Edwards, the reason Zimbra was worth $350 million to Yahoo to begin with was "they reverse-engineered the Outlook-Exchange protocol," giving them that same backwards-compatibility Microsoft can offer customers. It was also a ready-made enterprise play for a company that thought that maybe that was its future direction.

But the Zimbra-Yahoo relationship never gelled, primarily because Yahoo was a consumer-focused company and Zimbra was focused on enterprise customers. That focus makes it a perfect fit for Cisco, which despite recent signs of interest in the consumer space (illustrated by its purchase of Flip video camera maker Pure Digital Technologies), is primarily an enterprise applications vendor, and is clearly aiming its guns in Microsoft's direction. But to further the martial analogy, despite a powerful battery of guns, it doesn't have the armor-piercing bullets to get through Microsoft's defenses.

Zimbra could be that not-so-secret weapon for a platform vendor looking to shake customers loose of Microsoft's stranglehold on their documents.