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Working Webware: Can Zoho steal Microsoft's customers?

Dan Farber and Rafe Needleman interview Sridhar Vembu of Zoho.

Dan Farber (Editor in Chief of ZDNet and Between the Lines blogger) and I have a new video show: Working Webware. Each episode, we're going to pick on one hapless Web CEO, interview him or her, and then analyze their prospects.

For our first show, we sat down with AdventNet's CEO Sridhar Vembu to find out about Zoho's office productivity suite and how the company plans to compete against Microsoft and Google. We analyzed the company's business model and argued about Zoho's chance for success in the emerging Web 2.0 office software market. Running time is 9 minutes.

Recently, Zoho improved the offline functionality in Zoho Word, bringing it a small step closer to competing directly with Microsoft's Office Suite.

After watching the video, Vembu replied in an e-mail:

I agree we face a massive challenge. Here is why I feel optimistic: at AdventNet, we get about 1.5 million downloads of our IT Management & Security products (they range from network/systems/app management to help desk and a lot in between). These products target SMBs directly. We count in excess of 25,000 organizations as customers. We have relationships with nearly a thousand resellers world-wide, and we are establishing tiered distribution partnerships around the world. That business is growing at a really fast clip.

I believe there is a huge untapped opportunity in the SMB segment for Zoho. That is why we are investing heavily (Zoho division alone has now 200+ people in engineering). Fortunately, our AdventNet business is doing extremely well to be able to afford the investment.

Of course no one can predict the future, but based on the response we are seeing for Zoho, I am really optimistic. I believe just as the desktop software industry had room for players like Adobe and Intuit to thrive in the face of Microsoft, we will carve out a space for ourselves in the online application business, assuming a Google-dominated world. Execution is the key, as always.