I've been meaning to post this for ages but not had the time. It's a bit of an essay but I'm pleased I've got it off my chest. I've even added sub-headings to encourage you to read it!
In the beginning was the web
There's a web 2.0 bubble being talked about by quite a few people at the moment - hell, it was even being discussed by delegates at Loic Le Meur's Le Web 3 last December while the speakers onstage were discussing how to monetize social media.
One thing has struck me by the discussions I've heard or read about the looming burst - they are all framed by people's experiences in and around the first dot.com boom in the late 1990s.
But isn't web 2.0 different? Are not all the great tools and products we using in 2007 founded on a set of different principles?
The shift from Web 1.0 to Web 2.0
Whereas the web 1.0 boom was based on the financial development of the web; web 2.0 is about the communities that are adapting their behaviour, beliefs and cultural values to the web and the powers it offered in the late 1990s. Only thing is, these powers weren't recognised, tapped into or released back then.
In fact you can go even further and argue that it took the first dot.com bust to unleash the social, cultural and value-based changes that have come to represent web 2.0.
But don't take my word for it. In The World is Flat, Thomas Friedman, points out that one of the biggest drivers for bringing geographical, social and political barriers crashing down has been the huge proliferation of broadband which enabled the mass uptake of the high-speed internet.
How did this rapid proliferation take place? Because when the first dot.com boom bust the cost of fibre-optic cables hit rock bottom meaning enterprising firms could snap up miles of the stuff for no money at all.
Five years later broadband is (relatively) dirt cheap and giving everybody access to a new world of collaboration, knowledge sharing and almost limitless information.
From market-value to shared-values
The point I'm trying to make is that the first bust was financial because the main driver for the boom was financial.
With Web 2.0 the over-riding driver of growth is social or cultural. People use Facebook or write a blog not because it earns them cold, hard cash, but because it enriches their life.
Look at what made YouTube worth $1.65bn to Google. Was it the amazing proprietary software YouTube offered? No. It was the latent value held within the site's engaged, active and networked community.
If you're still not convinced let me assure you most of the great ways to monetize social media being talked about at Le Web 3 were based on the Web 1.0 holy trinity of advertising; sponsorship or registration-based services. There is no undiscovered way to get financial leverage from social media. The financial clout comes in the form of the networked society itself but current economic and business models are not in any position to benefit as they don't understand the shift from traditional markets to a networked economy.
Web 2.0 has allowed us to tap the potential of Web 1.0
In all of this what becomes clear - for me, at least - is that the Web 1.0 dot.com boom and bust allowed the internet as a networked infrastructure to flourish and spread.
Web 2.0 has allowed people - and future generations in particular - to adopt and adapt to new ways of communicating and behaving.
Tony Perkins puts it nicer than me in an FT article, Bubble 2.0, when he says:
"The great achievement of the Web 2,0 era, which is coming to an end, is that we learnt some of the distinguishing values of the internet."
The article then points out: 'By stimulating the sharing of content and social networking ... Web 2.0 companies have been the first to tap into the internet's true potential to connect people.'
This for me is where we come to with a Web 2.0 boom. People have been adopting and adapting to the web's "true potential" and this potential is fundamentally based on empowering people socially and culturally.
If mass markets cannot currently sustain the economic growth of Web 2.0 companies then some will fall by the way-side. But instead of a heap of disgruntled share-holders or burnt VCs, we will have a whole generation of digital natives familiar with the social and economic concepts of the 'gift economy' and social production. They will possess the cultural knowledge of what it is like to live in a networked world.
This is a hugely positive and exciting event. It will also be a challenge to organisations, businesses and governments. These institutions will need to adopt and adapt in order to survive this cultural collapse.
Technorati tags: Web 2.0; bubble; social+production; future; dot+com+boom; gift+economy; networked+economy
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