• by Laurie Sullivan  @lauriesullivan, September 24, 2009

Google's Web-based email service went down briefly on Thursday, as Gmail users suffered the second technical problem in the past two weeks. When service resumed, users could not access contact information.

A red bar across the top of the Gmail inbox explained that the service could not access people listed in their contacts. This disabled the recognition feature that enables users to type in a few letters to have the remainder of the email address fill in automatically.

A note posted to Google's Apps Status Dashboard at 7:29 PST admitted that the problem affected a small set of users unable to access Google Mail. The Mountain View, Calif. company provided a workaround," which meant accessing Gmail via IMAP. By 9:58, Google posted a note about resolving the problem and apologized for the inconvenience.

Aside from problems earlier this month caused by an overload of servers handling Web requests, Gmail suffered outages in February and March. The company does plan to increase its router capacity. This latest occurrence comes two days after Google News experienced an outage for more than an hour. ComScore rates Gmail as the fourth-most popular email service in the United States.

While some may believe the Gmail outage raises questions of the stability of cloud computing, Forrester Analyst Frank Gillett believes it's not indicative of a flaw in the fundamental concept of cloud computing, but it highlights the importance of not having down time when the service becomes a fundamental resource.

"We haven't heard of corresponding outages at Hotmail or Yahoo Mail, though they might have had them," Gillett says. "It shows the importance of customers thinking about having a way to set up the email service offline for those times when the service is unavailable."

Gillett says it will take a lot more than these outages for people to give up on the concept of cloud computing, but much more of this and people will lose their faith in Google, at least temporarily.

Consumers and businesses might lose faith, but from investors' point of view these are relatively small issues. "If you look at where the company generates the bulk of revenue, the applications are modest contributors," says Pacific Crest Securities Analyst Steve Weinstein. "You really can't say the quarter would be disappointing because Gmail goes down for a day or two. From a financial perspective, it's really a minor problem Google rolls right through."

Weinstein agrees that outages are a setback and disappointment. Google has a good opportunity to capitalize in the applications space and cloud computing, but not a lot of that is factored into financial estimates or valuation of stock.

And while outages make analysts think more about the company's ability to capitalize on a variety of services, in Google's case the services are in the "very early stages, and I would still trust that the company is capable of providing high-quality access to applications," Weinstein says.