IBM Looks to Challenge Gmail in the Workplace

IBM is introducing an inexpensive Web-based corporate e-mail service that will compete with Google’s Google Apps, which has recently suffered several high-profile outages.

Big Blue will likely try to capitalize on the damage that those outages have caused to Google Apps over the past year. Last month millions of business users could not access e-mail for almost two hours.

An IBM (NYSE: IBM) spokesman said on Thursday that the company will start selling its LotusLive iNotes next week. The lightweight e-mail service will cost $36 per user per year, about 25 percent less than what Google (NASDAQ: GOOG) charges for a more robust product.

IBM’s offering does not have as many bells and whistles as Google’s, but the technology giant could attract more customers because it has decades more experience serving the business market. Its products include Lotus Notes, one of the world’s two most widely used e-mail programs.

Google, on the other hand, generates the bulk of its revenue from advertisements placed on free search products targeted at consumers. It is just getting into the business of selling to businesses.

“The IBM brand will help a lot,” said Forrester Research analyst Liz Herbert.

iNotes will also compete with a Web-based e-mail service from Microsoft (NASDAQ: MSFT) that costs about $120 per user per year, according to the software maker’s Web site.