The NYT is reporting that Google is ruffling feathers in the enterprise software industry by charging too little. Google bought enterprise email solution provider Postini for $625 million last year and has started offering the companies email filtering and monitoring technologies as part of it’s Google Apps suite – at upto a 90% discount.

The archives of Salon.com turns up this wonderfully prescient article about why underdog startup Google was going to win big.

http://archive.salon.com/21st/rose/1998/12/21straight.html

“There’s something ultimately dumb about these all-things-to-all-people sites in a medium whose greatest strength is the ability to be specific things to specific people. If the portals can’t even build a better search engine, I am not betting on their ability to control an industry as fast-moving, innovative and metamorphic as the Internet — next year or any year.”

Google has announced the release of Google Apps – Team Edition, designed as a simple, accessible way for small teams within an organization to collaborate on documents and calendars, without the intervention of IT support personnel.As online threats like spyware, viruses and rootkits multiply, IT departments are typically overworked, and understaffed.

To keep their networks secure IT departments are notoriously cautious about what applications they allow on their networks. This can be very frustrating for the growing percentage of savvy users, who use increasingly sophisticated tools at home, and feel artificially limited when at their office computer. The new version of Google’s App Suite is targeted squarely at them.

Reports are circulating that Microsoft has offered $44.6bn to purchase Yahoo.

The news follows Yahoo’s announcement on Tuesday that they would be lowering their revenue forecasts, that they intend to lay of 1000 employees, and that chairman Terry Semel would be leaving. The share price of yahoo stock has fallen 46% since October.

Microsoft is offering, what some analysts are calling an exorbitant, 62% more per share, than todays closing price of $19.18. The premarket trading price has already jumped to $29.

According to Microsoft’s Kevin Johnson, the move is targeted squarely at facing competition from Google. In recent years, the growth of SaaS, and enterprise web applications has put pressure on Microsoft’s position. At the same time, Yahoo, poster child of the early dot-com-revolution, has found it harder and harder to compete with Google’s growing dominance on the web.

It’s hard to predict how such a merger would affect Yahoo’s open source efforts, some of which compete directly with Microsoft products (the Zimbra groupware suite, for example).

Anyway you look at it, if the deal does go ahead, it’s likely to change the internet landscape significantly.

Following is the letter sent to Yahoo’s board.

As the de facto front page of the Internet, Google has tremendous power.

Research suggest that 97% of users will never look beyond the top 30 results for their search. Google keeps the exact formula they use to rank results is a secret, and it’s constantly being modified. But when they answer over 3 billion queries a day, the difference between a high and low Google ranking in the results can be the difference between an IPO and chapter 11.

Consequently there is a constant battle between spammers (and site owners) who desperately crave the traffic of a high ranking, and Google who want their results to remain as relevant and useful as possible. And because Google is constantly modifying their formula, what worked brilliantly last month to boost your rank, might get you removed completely from the results now. And for as long as googles algorithm remains a secret, Search Engine Optimization (or SEO), isn’t a science, but something halfway between an art and superstition.