Internet search giant Google on Thursday has started delivering an online suite of software that includes e-mail, word processing, spreadsheets and calendar management, apparently taking its boldest move yet to challenge software giant, Microsoft Corp.

In order to widen its appeal to corporate customers, the Mountain View-based company said it will begin selling corporate America the set of essential business software tools.

The new version of the Google's Web-based software, dubbed Google Apps Premier Edition, is intended to help large organizations incorporate Google tools into the complex management schemes which big businesses use to control their computer networks

The software bundle is to be sold for a $50 annual fee per user. Besides the Web-based programs like Gmail, Google Calendar, Google Talk instant messaging, and the Google customizable Start Page feature, the PE suit now contains Google Docs & Spreadsheets as well.

Google has been providing a free version of its online software suite called Google Apps for the past six months. According to Google, over 100,000 small businesses and hundreds of universities countrywide are using the free service that is free of ads.

Google Docs & Spreadsheets is also a free web-based word processing and spreadsheet program that create and edit documents enables the people update files from their own machines.

By adding Docs & Spreadsheets to its Apps suite, the company tries to disrupt Microsoft’s efforts to convince corporate customers to buy the newest version of its market-leading Office suite, which was developed along with Microsoft’s new Vista operating system.

Besides Microsoft, the expansion also poses a challenge to International Business Machines Corp. (IBM) and its Lotus suite.

At such a low price, the new version also lets users get storage of 10GB per e-mail box, compared to the free version’s 2GB. The fee also buys you APIs to hook the suite into existing corporate systems, so admins can still control provisioning, data migration, single sign-on etc.

The suit also promises 99.9 percent uptime availability of the services and around-the-clock technical support, including phone support for administrators.

Google today also announced that its Google Apps will include Gmail for Mobile on the Blackberry.

With the announcement of the expansion, Google has attracted many analysts to comment on the move.

According to Rebecca Wettemann, an analyst from Nucleus Research, by launching its business software package at cheaper rates, Google is giving companies a greater stimulation to delay buying Microsoft’s Office 2007 as they assess the pros and cons of a cheaper alternative. “The timing (of this offer) is just brutal for Microsoft. It’s definitely a shot across their bow,” Wettemann said.

On contrary, Jon Stewart, senior analyst at Nielsen//NetRatings, doesn't see Google or other online office App providers forbidding Microsoft anytime soon. "Eventually, Web-based productivity tools could become as widespread as traditional software from companies like Microsoft," he said, "but they clearly have little to fear in the immediate future, given the relatively low penetration numbers that we're seeing."