Having sat through 3 days of the Web 2.0 expo 2007 and listened to all the confusion surrounding the term and what it means nearly two years after Tim O’Reilly introduced the term – I thought I’d take a shot at putting down my own take on the term.
In my view Web 2.0 is quite simply a statement about the maturity of the web. The web in its current form has matured along three key dimensions:
- The technical dimension – browsers have matured, web application frameworks have matured, server and network infrastructure used to deliver web applications have matured; all this allows for things like AJAX, Saas, Mashups, etc. to happen. None of these are fundamentally new ideas or concepts, they were all tried early in the web’s lifecycle and failed because the web was simply not ready for them. Javascript was simply too hard to get right across a set of browsers because of spotty support, most ASPs rushed to web-enabled applications in the shortest possible time and did a terrible job with them, there were hardly any web services to speak of until recently.
- The business dimension – there are a well established set of business models on the web today. Sure, there are new ones being invented all the time (more on this later), but there are some fundamental patterns that are very well used and understood.
- The user dimension – users have gotten used to the web and have come to rely on it. With the advent of tools like review sites, blogs and wikis, users have gotten accustomed to active participation as well. Users both as individuals and in the context of their businesses have come to trust the web (sure there are security issues, but these exist elsewhere as well).
Given all of this, a set of new possibilities open up. Carlota Perez in her somewhat dry but extremely informative book Technological Revolutions and Financial Capital discusses the sequence of events that unfold whenever a technological revolution like the web occurs. The final phase of a technological revolution is what she calls the “golden age” or “synergy phase” where she talks about a set of techno-economic factors that come together to change all relevant business models in a fundamental way. We are simply witnessing the beginnings of this phase with the web (the phase itself typically lasts 2-3 decades). So, what are some of the business models that have already changed/are currently changing because of the web:
- Commerce: this was the earliest to change and is now very mature.
- Software: this is in the early stages of change – two big changes in Software are Saas and Open Source – probably be a few more years before the dust settles.
- Telecommunications: this one is nearly mature – the big change has been the consolidation of services – i.e. the emergence of the bandwidth utility like the electric/gas/water utilities – today, one can buy all their bandwidth needs (wired and wireless) from a single vendor. The remaining piece is for the wired and wireless worlds to come together, which I believe is happening as I write this …
- Media/Advertising: this is again in the early stages – big changes are the format (digital assets) and peer production – again, be a few years before the dust settles.
- Finance: this is really still in its infancy – sure, a lot of the trading/banking activity has moved online and there have been some benefits; however, true innovations around business models have not happened in a big way – peer production seems like the big change here (Prosper is a great example) – probably be a much longer time before things settle here.
- Services(IT/Healthcare/others) : this appears somewhat mature – big change is in collaborative delivery from multiple/remote locations – not sure what other big changes are likely because of the web.
So why then does all the confusion exist around the term Web 2.0 ? The answer again is quite simple – marketing. What we’re seeing is quite similar to what is related in the story of the blind men and the elephant (one version rendered here) – various parties selling various things (books/conferences/software/services/whatever …) are associating whatever meaning is convenient to them with the term Web 2.0; confusion quite naturally follows.
I’m as sure as the day I was born that there are a bunch of sane people who see the full picture and are busy dreaming up all the new possibilities that this mature web we live in offers up …
