IBM Launches Cheap Email Alternative

ARMONK, N.Y. (TheStreet) -- IBM(IBM) has introduced an email service that will cost $36 per user per year, a package that is cheaper than a similar service from Google(GOOG).

IBM's email package, LotusLive iNotes, is expected to go on sale next week. The product includes email, calendar and contact management, and anti-spam and anti-virus features, but lacks certain applications of the Google service, such as word processing and a video channel.

IBM told the Wall Street Journal its email service is ideal for employees that don't "require all the capabilities of full-featured email and collaboration software, or for employees that currently have no access to company email."

IBM's email service will sell for about 25% less than the Google service.

IBM is banking on its large sales force and corporate relationships to beat Google despite its product being more lightweight.

"This is trouble for Google," Gartner analyst Matthew Cain told the Associated Press.

IBM thinks the timing is right for its email service because Google's service suffered a highly publicized outage that shut out corporate customers for nearly two hours last month.

"Candidly, Google has shown itself to be weak" in some areas of e-mail, said Sean Poulley, an IBM executive overseeing the company's e-mail service, the AP reports. "There is a world of difference between supporting a consumer-grade service and a business-grade service."

A Google spokesman told the AP the company isn't planning to lower its prices.

-- Reported by Joseph Woelfel in New York .

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