I received a notice today that Jotspot is relaunching as Google Sites. After taking a quick look at the sample sites, it seems pretty clear that they’re positioning the new application as a competitor for collaborative sites such as 37Signal’s Backpack.

The example sites include use of Google Sites as a company intranet, project management site, and virtual classroom. One can assume that it integrates with Google’s other applications, including Gmail, Google Chat, and Google Calendar, making it potentially more powerful than it might at first appear.

Uploading of files and attachments appears to be supported, with the standard package having 10MB of storage space and Premiere and Education editions of Google Apps offering 500 MB of additional storage space.

As collaborative, community-focused sites become more the rule than the exception, there will undoubtedly be more companies offering easy ways to rapidly deploy and simply update those types of sites without programming and HTML ability.

My main question is, with the concerns many individuals and organizations have about privacy issues, will organizations trust Google with the kind of proprietary information that intranet and project management tools generally contain?