In November 2013, we published a report laying out what will be the key points of differentiation between Google Apps and Microsoft Office 365 by 2016. At the core of this report is a simple message: The value of these cloud collaboration suites isn't inexpensive email; their value is in their role as an interaction point for your business ecosystem. And at the center of each of these interactions is content of some sort — contracts, marketing collateral, product specifications, customer records, and more. As more of this content lands in Google Drive and SkyDrive Pro, the market will reward the vendor that makes it easiest for information workers to author content, share it with others, manage its use and distribution, and be aware of any changes to this content. We call this combination of capabilities content services.

Google and Microsoft seem well positioned to deliver this combination of services. However, they have emerging competition for this opportunity from vendors that are currently disrupting the content space. In September 2013, Box announced it would introduce metadata to the files stored in its repository and give customers a note taking app, moving the service into the content management and productivity space. Huddle is also moving from the content sharing space into the creation space, unveiling its notes tool in December 2013. Meanwhile, cloud apps like Evernote, Asana, hopTo gain traction by breaking out specific tasks originally done in productivity suites (e.g. task management) and making them mobile.

So, 2014 is an important year for both Google and Microsoft. Neither vendor can simply point to their respective portfolios and declare victory in the content services space. The smaller vendors we noted are reimagining the holistic content experience in a way that is compelling to individuals and organizations. We expect over the course of the year for Google and Microsoft to address this by make strides in three key areas:

  1. True multiplatform support. This isn't simply putting a native app on all of the major platforms. It's also the ability for an IT department to manage the data within that app centrally through the admin console or through third-party tools.
  2. Context-specific experiences. Part of the reason tools like Evernote and Smartsheet are catching on is they provide the capabilties information workers require for a specific task. This flies in the face of the multi-purpose suites Google and Microsoft have built. Both vendors have inched in this atomized direction with Google Keep and OneNote respectively, but we expect to see them rethink other applications to provide easily discoverable, task-specific functionality.
  3. Enterprise-digestable disruption. The cloud is disruptive irrespective of the vendor. However, vendors that can smooth this transition with pre-packaged integrations into legacy systems, easy to master interfaces, and intuitive user experiences make it easier for business leaders and employees to accept this change.