Google's pact to offer free Web-based applications to enterprise software firm Salesforce.com's business customers shows how the Web giant is taking advantage of Microsoft and Yahoo's distraction with their bitter takeover battle.

The initiative — which expands Google and Salesforce.com's year-old partnership — marks another front in Google's campaign against Microsoft to move computer software from desktops to the Web.

"This is a natural partnership for both companies," said Rob Enderle, a Silicon Valley-based technology analyst. "Google gives Salesforce.com additional stature due to Google's overall influence in the market, and Salesforce.com gives Google some needed enterprise credibility."

The deal is particularly important for Google, Enderle said, because "Google really hasn't established any enterprise credibility yet."

Still, Enderle warned against overestimating the immediate impact the deal will have against the enterprise market leaders.

"Salesforce.com, when taken against big enterprise companies like Oracle, isn't a heavy hitter, so this is just a base hit not a home run," Enderle said.

Salesforce.com gains the ability offer Google's Web Apps, including word-processing, email, chat and spreadsheets, to its business customers, as well as to ability "upsell" clients with premium features, for $10 per user, per month, starting this summer.

Although Google's cut of that fee is unknown, the partnership represents a strategic coup for Google in its battle against Microsoft — which offers its own customer management software bundled into Windows.

"Google and Salesforce.com have always had similar models and philosophies about delivering innovations made possible by the Internet," Eric Schmidt, CEO of Google, said in a statement. "Salesforce.com was a pioneer in Software-as-a-Service and a year ago we joined them in this mission to bring the benefits of cloud computing to businesses of all types."

As Microsoft and Yahoo fight for control of the beleagured Web portal, the Salesforce.com pact shows that Google is aggressively forging ahead with its Web-services attack against Microsoft.

"What Google wants is these companies fighting," Enderle said, adding that Google "seems to be constantly making inroads where Microsoft isn't looking."

Meanwhile, Salesforce.com founder Marc Benioff is taking a clear side in the battle for internet supremacy, telling the New York Times that, "the enemy of my enemy is my friend, so that makes Google my best friend."

"This will make it easier for us to convince more businesses to stop buying Microsoft Office and switch to better services like this that are emerging in the cloud," Benioff told the Associated Press.

Google has been looking for a lane of attack against Microsoft for its new Apps Engine initiative — part of its effort to move software off desktops and onto the Web.

Salesforce.com was founded in 1999 by former Oracle exec Benioff, with the backing of Oracle boss Larry Ellison. Since going public in 2004, the company has grown quickly, but it only reported a profit last year.

That's probably why Google hasn't already bought it outright. But as the two companies align their technology, chatter in increasing that Google may be interested in acquiring the company.

After reporting $750 million in revenues last year, Salesforce.com is currently valued at between $3 billion and $7 billion, according to industry estimates.

by Sam Gustin