Thursday, July 31, 2008

Is Web 2.0 cycle coming to its end? yes and no

Chris Shipley and Richard MacManus have recently posted their thoughts on whether the Web 2.0 cycle is coming to the end. Both posts are written thoughtfully and they are definitely worth of reading. Here are a few of my comments on their thoughts.

"Web 2.0 Cycle", an ambiguous term

In her post, intentionally or not, Chris used a vague term---Web 2.0 cycle. She argued that "The Web 2.0 Cycle Has Come to a Close."

Actually there are at least two different Web 2.0 cycles. One cycle is in terms of the evolution of World Wide Web. The other cycle is in terms of the evolution of Web business, which is indeed Chris wanted to talk in her post. Though the two cycles are closely related, they are different from each other in terms of the timing of the beginning and the end. The end of Web 2.0 does not mean the end of Web 2.0 startups. This is a mistake in Chris' post.

In his response, Richard sensed the difference but unfortunately he had not explicitly spoken them out. Richard agreed to Chris that Web 2.0 as "a solid Web platform for applications and services" was coming to the end, but he disagreed to the claim that the Web 2.0 cycle was coming to the close. I support Richard in his point. If someone asks me whether Read/ (a typical Web 2.0 company) is coming to its close, my answer is no.

We must not be confused. I have also predicted the initiative of Web 3.0 just a few days before. But it does not mean Web 2.0 companies are going to be out of business soon. Web evolutionary cycle and Web business cycle are too different things. Web 2.0 as an evolutionary stage is about to pass. But Web 2.0 business as a typical model continuously serves an irreplaceable role on the Web. This role is not going to decay soon and thus Web 2.0 companies will stay much longer than Web 2.0.

Role of Web 2.0 Business

Web 2.0 companies construct the societies of basic individual functions on the Web.

For example, at Web 1.0 a webmaster can upload a video to its own site. What Web 2.0 business does is to build a site that allow everybody shares their uploaded videos. A typical successful company in this category is YouTube.

Why do I name it is a basic individual function? If we think of that there exist individuals on the Web, video represents the eye of individual. At Web 1.0, every individual may have its own eye. On Web 2.0, these eyes starts to communicate to each other. YouTube is a society of these "eyes" in contrast to a society of the individuals of the "eyes".

But we need to have a society of "eyes", don't we? By sharing what each individual sees, all of us see better than before. This is the power of social networking and this is why Web 2.0 business is valuable.

By this understanding, we can now easily explain why Web 2.0 business will last longer than Web 2.0 itself.

Web 2.0 is about to pass because the intrinsic contradiction in its fundamental---the ever-increasing number of identities vs. the lack of mechanism to manage these identities. By solving this contradiction, the Web will enter a new stage that is very different from Web 2.0 and new business that is very different from Web 2.0 business will emerge too.

But the changes predicted before does not mean Web 2.0 business is going to be close. By solving the identity problem at Web 3.0, we still need communities for each individual functions, or we still need communities for varied roles of each individual. Web 3.0 will bring everything up to a new level. But the lower level communication is still the foundation. This is why Web 2.0 business will not only survive, but also keep on growing in the future. The relation between Web 3.0 business and Web 2.0 business would mainly be complementary instead of contradictory. RWW is going to last long time. ;-)

"Free" will no longer be fundamental

In her post, Chris predicted that the age when "Web content and applications are free" was to be closed. Richard disagree to the point. But this time, I stand with Chris.

Free might be "a business model". But even it is, the glorious time of this business model is passing.

Someone would argue that nobody likes to pay for using Web services. That's true! And it is why "free" has been successful so far. But things are changing.

Let me ask a question: you certainly do not want to pay for consuming the content created by the others, but do you want to get paid by the others who consume the content created by you? Answer it honest and think of the success of Google's AdSense.

Here is a shift. With Web 2.0, more and more users become not only the Web content consumers but also the Web content producers. As consumers, they want "free". As producers, however, they want to receive something in exchange of their hard work on producing the "free" content. That is, they actually do not want their knowledge to be "free". This shift is the reason why free as a business model is not going to be fundamental in the future.

The rise of mind asset is inevitable. When individuals have spent so much on developing their unique mind, it is time for them to be rewarded. Before Web 2.0, there is no chance. After Web 2.0, chances have become tremendous. Knol, Mahalo, chacha, and a few others have already been the pioneers, though none of them have intentionally understood the real magic of mind asset. When some company truly gets the magic, its product is going to shaking the world.

"Free" is great. But pure "free" is passing. "Paid" is not evil. Actually, only through "paid" the quality of the Web can be improved tremendously and eventually everybody will be happy.

For people still do not believe it, let me quote a history of mankind to end this post.

As we all know, in the very early time of human society, humans lived in a crude communist society. Everything was free to the tribe members. With the evolution of the human world, however, this situation changed. Private property emerged and many things became not free. People started to know that in order to obtain something valuable from the others (even if they were tribe members), they had to pay. Such a change is not a retreat but a significant improvement of human society. It was the first time in human history that individual's knowledge became valuable, and hence learning and education became valuable, and hence humans evolved.

On the Web we are going to experience a similar progress. Don't need to cry for the lost of "free". We will only obtain a better Web and a better human society after it.

"The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there is no new thing under the sun. Is there any thing whereof it may be said, See, this is new? it hath been already of old time, which was before us." (Ecclesiastes, 1:9-10, Bible, KJV)


Anonymous said...


Once again, spot on!

You are really saving me a lot of time these days :-)


Yihong Ding said...

Dear Kingsley,

I am glad to hear it. Let me know whether I may do some other help for you. :-)


Anonymous said...

Web 2.0 Is Like Pornography

Like so many tech articles posted since Tim O'Reilly coined the term in 2004, this one references "Web 2.0" as if it were something tangible--or at least a concept with clear, concise definition. It is not. In 2006, Web founder Sir Tim Berners-Lee sagely observed that "nobody knows what it means":

And now in 2008, the most honest thing we can say is that "Web 2.0" means whatever the techno-marketeer (ab)using it wants it to mean. Otherwise, why would intelligent people like Isaac O'Bannon still be writing articles asking "What is Web 2.0?":

And, why would McKinsey's just-released best-of-breed report entitled "Building the Web 2.0 Enterprise" ...

... include no attempt at defining the term other than to list the "Web 2.0 Tools" that comprise or enable it? And even there, the chief ingredient is identified only as "Web Services", adding more mystery to the mix as one ethereal term is offered up to explain another.

As originated in an website design posting...

... "Web 2.0" is like pornography: Nobody has defined it, but you know it when you see it.

Bruce Arnold, Web Designer, Miami Florida