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Search engine giant Google recently announced that it has opened the Google Apps Marketplace to software development teams. More than 50 development companies will be involved in the apps marketplace which is set to offer a variety of different business programs such as tax and payroll software, project management applications and tools for Google Docs.

The new Google Apps Marketplace will extend the search engine giants current application suite, offering a selection of other vendors' applications that work with Google's cloud.

The new third-party cloud-based applications will be integrated within Google to work like current Google apps. Google will charge developers 20% of the revenue from sales on the marketplace site, and a one off setup fee of $100.

The new app store also gives Google a new, if small for now, revenue stream that isn't driven by search-related advertising.

"The Google Apps Marketplace eliminates the worry about software updates, keeping track of different passwords and manual syncing and sharing of data, thereby increasing business productivity and lessening frustrations for users and IT administrators alike," said Google’s product manager Chris Vander Mey in recent post on the Google blog.

According to the Google Apps director of engineering, Vic Gundotra, the marketplace can be built using a development teams ‘own platforms’, ‘own tools’ and ‘own infrastructure’. He also suggested the possibility of using the Google Apps Engine to help create apps.

Since the launch of Google Apps in 2006, they have always been viewed as an alternative to generic Microsoft programs, but not a real threat. But now this new development will put the internet giants in a much stronger position to challenge Microsoft's dominating position in the office application market.

Google is challenging Microsoft with the goal of becoming the new operating system of the web.

Before this development the Mountain View Company offered users and businesses a selection of their in-house web based applications such as Google Docs and Google Calendar. With these apps they created a following of 25 million users – 2 million of those are businesses.

Cloud applications, (internet-based applications), were originally looked upon as promising but have been slow to take off. Consumers tend to go with brand names they already know and trust, and most seemed to be confused about what cloud-based applications were. For a long time Microsoft’s leading market position seemed safe.

But Google is now picking up the pace, it’s found a new revenue stream and it already has released the Google Chrome internet browser and is working on a Chrome operating system. Google’s App Marketplace is the search giant’s next step towards becoming a leading software company.