[Note: if you're new to 'Web 2.0' then read Tim O'Reilly's 'What is Web 2.0' article]

Despite my reservations about the hype surrounding Web 2.0 I thought I really ought to find out a bit more, so yesterday I went to Carson Workshops's 1 day event, The Future of Web Apps.

There was a great speaker line up with all the big names in Web 2.0 - Flickr, Delicious, 37 Signals, DropSend, Mint, Google Maps.

They'd also managed to fill 800 seats - almostly exclusively with blokes blogging on laptops as far as I could see. 

There's certainly some "cool stuff" going on but I was going to see if I could start to understand the business / marketing / commercial implications of "Web 2.0". 

I still don't quite have the answer - the companies talking Web 2.0 at the moment have been built from the ground up as such. I'm after "before and after" case studies where applying Web 2.0 thinking and technologies has demonstrated commercial gain - know of any?

Here are a few thoughts on Web 2.0 from a commercial point of view...

1. Can it save you money? 
Yes, it probably can. If you can (re)use applications, data and services that already exist then that should save you time and money. Pick 'n mix and create your own web platform/service. 

BUT... the barriers to entry, and costs, are lowered for everyone, not just you. So that means more competition, less competitive advantage. And, do you really want to risk your business based upon a collection of web services where you quite possibly have no SLA, no contract, no guarantee that they'll be around next week?

2. Can it make you money?
Yes. For new businesses / start ups there appear to be 3 broad options:
1. Build a huge user base and get bought by Yahoo! (Flickr style...)
2. Build a niche service / application that solves a particular problem and use the web's reach to sell it at a comparatively low price (Basecamp style...)
3. Build a great API and licence it to other businesses (Mint style...)

But what about established companies and brands?

Yes-ish? The argument is that an improved user experience or service will increase conversion rates, customer retention etc.

BUT... things like AJAX and other Web 2.0 technologies really aren't that easy to do and to get to work across all browsers and devices. By all accounts, it's actually pretty damn hard. Which means time-consuming and expensive I guess? The whole issues of Accessibility was also neatly side-stepped - I think WEB 2.0 can be accessible, but it's really not easy. 

3. Can it help your online marketing?
Yes, in as much as you can distribute, feed, mash and generally push and pull content, applications and services all around the web. Most the companies speaking emphasis the fact that they have spend nothing on marketing and that it has all come about through viral awareness and being embedded in and around the web, with a resulting 'network effect' doing all the marketing work for them.

BUT... are those days already almost over? How many feeds can one man eat in a day? Even the founder of del.icio.us admitted that RSS used to be a big deal a couple of years ago and now "I'm not so sure...". And there's us thinking that RSS was supposed to herald the death of e-mail? 

>> What about the "social software / collaborative / sharing" benefits of Web 2.0? Surely they will help you market your products or services "better, faster, cheaper"?

BUT... benefiting from the network effect requires critical mass. A lot of it. If you can be like eBay and absolutely dominate your space then you're sorted, no doubt. If not, you risk just fading away as an 'also ran'.  

>> What about the Web 2.0 notion of 'Clean URLs' - URLs that are absolute and permanent identifiers, which are semantically meaningful to the user rather than exposing the technology underneatch. i.e using a URL like http://www.e-consultancy.com/jobs/ rather than something like http://www.e-consultancy.com/content_id?=123&session_id=blahblahblah

BUT... I thought this was old news? We did that years ago (URL rewriting) only then it was about search engine optimisation - and still is for many.

So, here's what I'm after - 'before and after' case study example of where established sites / companies have used Web 2.0 technologies and thinking and can show commercial benefit as a result. Or rather, ones who are actually happy to talk about it / share the results...

Know of any?

Ashley Friedlein
CEO, E-consultancy.com

Nice post.  You focus though upon the front-end and consumer-visible aspects of W2 - the 'behind the scenes' and mindset requirements are of equal import, imho.

While I don't pretend to understand W2, the boxes it ticks for me though are:

• reuse, don't reinvent - why burn cash recreating A4 paper? a directory? a service - just use it (with permission, under rules of course)
• turn data/stuff into services - make static repositories or by-products into service offerings. Traditional "service business" model, but only now widely possible
• components are king - modularity, mix and match, plug and play, rightsized code... All ways of saying that W2 is about orchestrating appropriate small nuggets of code, data or functionality. The mantra is 'how small can it be' rather than 'how big can it get'
• agile and flexible - while requirements may persist, the methods and parameters may change. Frequently. Just suck it up and move on.
• openness and interoperation. Don't close doors to other inventions or fair uses.

Now, all of this can apply to equally to ideas, business approaches, licencing agreement or planning your warehousing setup. This is why I think that W2 herals an age of disaggregation, fair use, "creative constructions" and standing on the shoulders of others.

There are of course risks and challenges. Leaving aside the impact this has on the culture of traditional organisations (there are more of these than generally admitted when it comes to this level of agility) W2 has at its heart some requirements which are not stable:

• solutions and cool exemplars start as passion-oriented, free services. In this, the creators cost their time at zero. This is not sustainable since (surely) Yahoo can't make multimillionaires of all of them. Can they? :)
• Licensing: currently there's open and free access to key data repositories (eg Amazon, Yahoo). While it suits these data-generators to make this freely available for now, could you count on this continuing? For how long? Maybe an innocent "charge" to cover server request processing overhead? Oh go on...

This said, W2 is an interesting syszygy between business models, practice and technology. As software moves to "service oriented architectures"; methodologies become "agile"; customers are ever more segmented... seems to me as if W2 is a convenient, attractive and not unhelpful broad label for a new 'feeling' abroad.

This is a long way of saying that looking for "W2 companies" is a bit of a red herring: look, rather, for how this mindset is permeating all companies and becoming a more modern way of doing business.

Ashley

We've had a brief look at using AJAX type interactivity.

While the user experience benefits were potentially there (qualitatively speaking), the bigger (negative) impact was infrastructure.

All those XML server requests add up!

Cheers
David

From my point of view, web 2.0 is a 'mashup' (forgive yet another buzzword). It a collection of things:

• simple sets of data/information
• Meta data (information about information)
• open-source software & APIs
  
• social connection/inter-connection
• democracy
  
• and viral usage!
  

Actually, the social element is the key - its the re-engineering/broadcast/sharing of information that has provided the catalyst for del.icio.us/flickr etc.

Successful web 2.0 companies do something very valuable - they  turn every single user into a conduit - both for the services they use and for themselves - empowering  them with tools to share/contact/write etc.

Probably the best article I have read on web 2.0 is here

In tems of business case - Extracting meaning or value from web 2.0 really depends on where your coming from.

If you are a technologist(like me) - there are one set of elements to look at. If you are an entrepreneur,  there are pots of investment capital available if your idea is good enough. Every organisation should look carefully - you can draw benefits/learn lessons from where others make mistakes.

In terms of technology, there are plenty of benefits in using some web 2.0 techniques. AJAX is 'mutton dressed as lamb' in some ways  - its been used for years, but its gone through something of a revival - popularised by the likes of del.icio.us/flickr etc and been metaphorically re-born as 'cutting-edge'.
(some companies would kill for this level of successful re-branding!)

AJAX was coined here

If its used properly, AJAX can reduce load on servers, decrease the bandwidth/traffic to sites and provide richer interactivity (used in moderation) having a positive effect of infrustructure. Oh and you don't really  have to use XML by the way, thats the 'AX' bit.
Unfortunately, if you don't know what you're doing, it can cause more issues than it solves - breaking accessibility/usability, errors in browsers, top-heavy server load.

From a business perspective, I already know of companies picking the best bits from web 2.0 - even big corporates using external packages/APIs/wikis/CRM and its having profound effects in some cases.

Sceptics might offer that it will all end in tears in a few years - maybe so, but businesses that make wise decisions and take advantage of whats on offer will be further up the curve than those that don't.

There's a pretty good Web 2.0 guide + books, technologies, blogs here:
http://www.programmableweb.com/reference

Hope this is of some help.
Nick.

I may be way off the mark here but I think  Web 2.0 is simply a media invention to describe how technology is being used differently to how it was a few years ago.

Blogs  are deemed  Web 2.0. That  always makes me scratch my head. Blogs are simply a combination of a simple database, server side code (like PHP or ASP) with the ability to parse RSS feeds. All of this has been around since before 2000.

AJAX (the scripting technology not the detergent) is deemed to be Web 2.0. All it is is clever javascript combined with XML and CSS. I know a guy whose programming career at Fujitsu started in 1999 playing with AJAX.

There's nothing new about Web 2.0 technology.

Its just companies like Google come along and make a very cool application like the Google Map system using AJAX and suddenly every man and his dog jump on the bandwagon and start playing with it, saying they're the latest Web 2.0 developers.

In my humble opinion there are some good applications of this so called new technology. As with all technology if you use it to solve a problem (like Google did) and it works, then it's possible that business models will follow.

AJAX for instance does seem a possible answer to the problem mobile web has.
I'm not brave enough to say it is "the answer", I just believe it might be one possible solution.

Basically the big problem with Mobile is the size of the consumer audience. To make it viable as a business a lot of operator/OS/browser compatibilities have to be overcome. There are currently 2 platforms used JM2E and XHTML to develop mobile apps and sites. With JM2E particularly in order to reach the consumer you need to port the development to many different operator networks, phones, OS/platforms, resolutions etc etc. It means developing a lot of code for a lot of apps for a lot of different systems and OS's. It means a lot of expense.

AJAX could potentially solve this problem. If a browser based platform was developed with AJAX it could potentially be used on any type of phone. So potentially a critical mass of people could download the same platform in AJAX meaning app developers have a standard to reach a wide audience. If enough people started to use AJAX then the network operator doesn't matter any more building apps for the OS become much easier and the audience much easier to reach, therefore the business model is better.

Of course there are a lot of ifs and buts there. But it potentially could be a "Web 2.0" application that could help the Mobile industry.

My view is simple with Web 2.0. If it solves a real business problem then it is viable. If it doesn't then it isn't.