Last week Google announced it was buying Postini, a vendor in the e-mail security space.  Many have speculated that Google’s move was made with Microsoft in mind as Google grows its Google Apps into a credible challenger to Microsoft Office.  Is the time right for enterprises to seriously consider Google (and other web-based applications) as a realistic alternative to Microsoft Office?

Google isn’t the only vendor with a Web story to tell, ThinkFree also offers a web-based suite of collaboration and document creation applications.  Looking more specifically at the collaboration and shared-workspace arena, a number of startups such as Mindquarry, Foldera, and Convenos to name a few are offering web-based applications that compete with the likes of Microsoft SharePoint and Lotus Notes/Quickr.

But in our research we’ve found that web-based tools still lack two key elements that limit their usefulness.  The first is simply feature sets.  Google Apps provides a usable set of document features that may be appropriate for small offices, but it simply lacks the robust feature set including revision tracking, graphic support, and a number of other features demanded by heavy users of applications such as Microsoft Office.  Gmail lacks a number of the features of Microsoft Outlook and Lotus Notes, including tool-bars to support third-party application integration.  For example, many CRM applications provide an Outlook toolbar enabling messages to be tied to specific customer accounts.  Most of the web-based applications I’ve looked at lack the ability to save documents into a shared workspace directly from within Microsoft Office, a key requirement for user acceptance of shared workspace applications.

The second is the lack of off-line support.  Web apps work great when you are connected to the Web, but not everyone has full-time web access, particularly traveling employees working at customer sites or on airplanes.

That’s not to say that there isn’t a case to be made for enterprise usage of emerging web-based application suites.  One company we interviewed for our Building a Successful Virtual Workplace benchmark noted that they are using Google Aps for guest workers.  They’ve found it easier and cheaper to provide a Google Aps account rather than provision fully configured PCs.  Many small companies with limited feature requirements will likely find web-based apps cheaper and easier to support than the more expensive full-blown office suites.

All of the issues I’ve described above are likely short-term limitations to the use of web-based applications.  I expect that over the next 3-5 years the line between capabilities of web-based applications and fat applications will greatly diminish.  It could be that at some point in the not so distant future, web-based applications will be the norm rather than the exception.  Enterprises would be wise to keep abreast of web-based application development moving forward.