While Microsoft is still in beta with its hosted email service, Windows Live Domains, Google has announced that they are providing hosted Gmail for students at San Jose City College. It’s a beta too, like so many Google offerings, but SJCC has 10,000 students relying on this beta. Google is also inviting other organizations to try it out. To be fair, Windows Live Custom Domains also features the less compelling hosted instant messaging, but Google could provide that too, of course.
Beyond the battle of the dueling Internet email services, the underlying issue is that no matter which one is chosen, it’s less business for traditional software as Nicholas Carr points out in Gmail attacks Outlook. There may well be fees for these services when they launch for real and/or they may serve up ads to users like the garden variety Gmail and Hotmail, but is seems very likely that they are going to put a crimp in the revenue stream from some of Microsoft’s biggest cash cows.
Update 2/11: Microsoft’s Robert Scoble has a bit of a rant about this story. Of interest is that he reveals that Windows Live Custom Domains has signed up “20 colleges/universities” for their beta.