Web 2.0 can be a very successful enterprise tool, but it's still too immature to completely replace Microsoft Outlook or IBM's Lotus Notes, speakers on a Web 2.0 Expo panel said Wednesday.

Asked how they would pitch a CIO or technical officer on their technology, SocialText co-founder and CEO Ross Mayfield, Matthew Glotzbach with Google Enterprise, and Zimbra co-founder and CEO Satish Dharmaraj all noted that their products add a layer of collaboration and a rich end-user experience that younger employees are demanding.

Employees "are wondering if they are violating corporate e-mail policies all the time when they back up their e-mail to Gmail," Glotzbach said. "But they do it because they know that they will have a larger space to store their e-mail and they can search for messages easier. This is one of the reasons why we started developing Google Docs."

As for easing the burdens placed on CIOs today, the panelists said they have many things to offer. "From the CIO's perspective, if you have 25,000 desktops and you have to patch applications from Microsoft, it can be a chore. With Web 2.0-based applications, you type in a URL you can get your software updated instantly," Dharmaraj said.

Companies are adopting wikis, blogs, social networking applications, and mashups at a high rate. A recent Forrester Research and McKinsey survey of more than 400 executives found 80% saw Web 2.0 technologies as an opportunity to increase their companies' revenue and/or margins.

Individually, Google, SocialText, and Zimbra are making serious headway in the enterprise.

Google announced plans Tuesday to expand its free productivity suite to include Google Presentation, an obvious jab at Microsoft's PowerPoint product.

In addition to its current contracts, SocialText is partnering with other Web 2.0 companies and Intel Capital to form SuiteTwo.

Open source e-mail platforms like Zimbra's Collaboration Suite are also continuing to shave off market share from Office and Lotus Notes because of their ability to run in Linux environments -- a cost-savings selling point for some companies.

Despite their best efforts at permeating corporate culture, all three Web 2.0 companies acknowledged that they still rely heavily on traditional Microsoft and IBM productivity suites to get critical work done. Glotzbach admitted that high-level accountants with Google were still probably using Excel over Google Spreadsheet to get their work done, despite Google CEO Eric Schmidt issuing a directive last year to get the company to use its own products as much as possible.

Further discussion of using Web 2.0-based products at work will be the focus of the Enterprise 2.0 show in Boston in June.