This blog has led to action - make sure to visit the

Wednesday, September 13, 2006

Web 2.0

I was asked yesterday whether I think that Web2.0 is a bubble or not. And I think it is, but clearly nothing as bad as what happened in 2000.

There is a lot of hype, and there is a lot of unknown, but what cannot be ignored are the fundamental underlying trends that are shaping beyond the hype.

The buzz words are the growth of P2P, marketplace disruptions, swarm innovation, social webs, folksonomies, long tail economy, etc...

Many thought leaders have been preaching to the crowd already:

  • Yochai Benkler describes in his book "The wealth of networks" how grassroot movements have been able to resist and fight against large corporations, for example on the voting machine issue. He demonstrates that the cloud is a very powerful and productive force.
  • John Seely Brown talks about swarm innovation in ecosystems across Asia. In his book "The only sustainable edge", he describes how a network of independent subcontractors can produce faster better goods than a large corporation.
  • Tomi Ahonen and Alan Moore recently published a book called "Communities dominate brands", in which they show how the next generation is about more than just being connected, it is a Community generation. They show how start-ups with low budget can outperform large corporations by fostering a solid ecosystem around their business and by engaging their customers.
  • Seth Godin talk about "The purple cow" and the need to move from push marketing to engagement marketing
  • Chris Anderson exposes the power of the web to enable the long tail economy
  • Thomas Malone predicts in his book "The future of work" that the technologies of cooperation available today will change the way we do business and manage organizations
  • Michel Bauwens talks about Peer to Peer as the emergence of a new civilization

The online community is vibrant with creativity, and a lot of options/revenue models are being explored or are emerging:

  • Virtual worlds are getting real (2nd life, everquest, etc...) with items sold on eBay and credit cards to cash money out at ATMs (gold farming)
  • Online videos uploads and dowloads, IPTV and P2P are trying to offer an alternative to regular video content distribution. I have mentioned in my previous post that it is clearly a very good way to produce reality TV
  • Social Networks are still the thing of the day, and to me another form (but only 2 dimensional) of virtual worlds

Meanwhile Interruption marketing is dying: for example I have read in "Communities Dominate Brands" that a study had shown that 71% of car buyers got influenced by word of mouth vs. 17% influenced by TV ads.

With all these changes come new challenges

  • The explosion of services and communities results in content overload and creates the need for managing our attention and digital identities
  • Ranking/ratings/reputation systems need to be enhanced and controlled, to prevent gaming, we need to understand whether trust can be transitive, and if so, in which circumstances. In this area, I like also like the concept of transparence: how much of your identity are you willing to divulge. I see it as a good indication of trustworthiness.
  • Making sense through tags requires maintenance to aleviate overuse and obsolescence, and to better describe individuals semantic, context, and goals. How will we be able to manage all this content moving forward, at the global level and at the personal level (what happens to my content when I die for example)

The opportunity is for companies, large or small to make sense of what is happening. But overall, more than a technology evolution, web2.0 is really an expression of a sociological change that has been enabled by technology, and it goes far beyond just technology. Web2.0 is not about Ajax or the latest cool free service, it is not about cool phones or IPTV, it is about how people relate to each other, how they learn to trust each other, and how they learn to live and work with their neighbors.
And since we are talking humans and not technology, we'd better be ready for this changes to take a long time. The Internet bubble happened because people though the world would change in one day, the web2.0 bubble is another sign of impatience from the techies community and their investors, we should already be looking at web3.0 and beyond...