What is Web 2.0

An interview with Dr. Stephen Kelley about Web 2.0.

1. What is Web 2.0?

  Web 2.0 is an ambiguous and confused meta-label related to currently popular and successful web sites. The more I think about it, the more I prefer to substitute other terms to more precisely talk about aspects bundled under this meta-label. It was originally coined while analyzing common trends and principles shown by these sites. On a financial level, Web 2.0 means huge investments and valuations up to and exceeding $1 billion for web site companies where the sites currently generate little revenue or operate in the red. These numbers anticipate monetizing the large consumer base on these sites through advertising. On a user experience level, Web 2.0 encompasses many elements of active user involvement and interactivity described by labels like X2X (e.g. P2P) social networking and consumer generated media. On a technical level, Web 2.0 refers to a resurgence of web applications providing the same level of interactivity and richness as desktop applications, and technologies for effectively developing such web applications like Ajax.  Most of these themes are familiar from the pre-2000 .com boom and bust which might be called Web 1.0. A case study of a company such as Pointcast has all the elements discussed above. What is yet missing in the comparison in Web 2.0 is the crash. Pointcast, long dead and gone, was one valued near to ½$ billion based on anticipated advertising revenue. Web 2.0 might be viewed as a revival of Web 1.0 with new and improved technology. Web 2.0 companies hope that the big difference is that these large valuations will be realized in real revenue.  I believe that the real significance of Web 2.0 is of a mini-cycle within a larger phenomenon of the Information Revolution, a technologically driven social transition of the magnitude and significance of the Agricultural and Industrial Revolution. In these past two transitions, the full impact of these transactions was realized generations after the basic technology was in place. I believe we’ll see a similar pattern in the Information Revolution and that Web 1.0 and 2.0 are the first little ripples of a fundamental transition that we have only yet seen the very beginning. 

1. What impact does it have on marketers?

  Web 2.0 has a huge impart on marketers. Various forms of Internet advertising are the fastest growing segment of advertising. Reductions in overall advertising segments are direct consequences of budgets and eyeballs moving from traditional media, a trend that seems to be accelerating. Technology capable of delivering and enriching the value of almost all media by transmitting and processing it using Internet/Web technologies exists and is quickly embracing and conquering all media. A fundamental reality of the Information Revolution is virtually unlimited possibilities for media. The economies of Moore’s Law, or to use Bucky Fuller’s term accelerating ephemeralization,  are creating an infrastructure where any media, including advertising, existing on the planet can be instantly available, and individually customized, to anyone, anywhere, anytime. The flip side of this is that it is possible for any individual to make their media instantly available to everyone on (and off) the planet. Amazingly, the storage, transmission, and processing costs for this are quickly dropping to nothing. This has a huge impact for every individual and society as a whole. Since marketing provides the financial lubrication of the media machine, marketers are in the hot seat in this transition and have the potential to play a fundamental role. 

1. Is this a case of lessons learned from the dot-com bust?

  Some lessons have been learned, but I think we’re seeing and will continue to see some of the same mistakes. The technology for building rich, interactive web sites has significantly improved. However the web browser will remain an important, but only one element in a rich technological tapestry which cannot exist in isolation. To elevate the browser to a special status or anticipate it replacing all other channels is a mistake that has been made before. Another lesson learned by some and forgotten by others is that this is a fundamentally different world than mass media TV marketing requiring fundamentally new and innovative models. 

1. Provide examples of successes as a result of Web 2.0 in relation to the emerging technologies.

  SOA, service oriented architecture, Atlas and increasing broadband penetration have made it easier than ever to construct rich, interactive, distributed applications that can be used from a web browser. These technologies have allowed companies like Google, Flickr, YouTube, and many others to do things that would not have been attempted even a few years ago. Moreover, these technologies have quickly progressed to where small companies and even individual developers can create similar applications on budgets of practically nothing that these companies have. Scaling these applications to millions of users still has significant cost, but the gap between new proprietary software and widely available commercial and open source toolkits has shrunk to a couple of years at the most. Once a good idea is seen on the web, it very quickly becomes a common software capability. 

1. How could marketers use some of these technologies more effectively?

  The most important step for marketers to take is to really observe, use, and be part of this new world. In one sense, it is as simple as buying “time” on new media. However, to excel, survive, really innovate in new media, marketers have to live and understand it. Start a blog, use an RSS aggregator, consume podcasts, make and upload videos to YouTube. Get young people who have grown up in and live in this new media world into your company, listen to them, let them try things and drive new innovations in collaboration of more experienced members of your company. Read science fiction. 

1. What are the misconceptions?

  That Web 2.0 means something. That what we are seeing now doesn’t have roots in the past and is not part of something larger. That the browser is the whole story. That the old models are applicable. 

1. Which technologies do they believe will undergo more changes, and how will marketers need to adjust?

  I think most all the technologies have been in place for some time. We’ll continue to see prices drop, speeds, capacities and penetration increase. Software deveopment is somewhat a bottleneck where there we will likely seeing significant innovations for some time. The real changes will be in how we use the technology, new business and financial models, and impacts on society, politics, culture and economy. 

1. What other advances do they see on the horizon?

Nanotechnolgy has the potential to expand the Information Revolution to things made of atoms. Current information technology deals with things that can be converted to bits, represented and transmitted by electrons. Nanotechnology has the potential to bring some of the power and economy of information technology to real things made of matter: materials, construction, living organisms and our bodies. Information technology and nanotechnology are symbiotic aspects connected by operation at a small level. Manipulating matter at the microscopic level underlies the manufacture of information technology components and information technology is needed for manipulating matter at the microscopic level. More powerful computers are needed for nanotechnology to progress and nanotechnology is needed to make more powerful computers. 

1. How should marketers prepare for these changes?

  Hang on, be open and embrace change. Learn from new generations and promote timeless principles of honesty, integrity, compassion, giving, trust, truth and love without hanging on to manmade, artificial models of the way things should work.