Web 2.0 offers a better place to stay

It is the latest label that online software service suppliers are keen to deck themselves out in, but what exactly is Web 2.0 and what can it do for business?, asks Neil Ward-Dutton

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It is the latest label that online software service suppliers are keen to deck themselves out in, but what exactly is Web 2.0 and what can it do for business? asks Neil Ward-Dutton

Depending on how much time you spend reading material originating in the US, you may not have heard of "Web 2.0". Even if you have, I will lay odds you are not entirely clear about either the meaning or the implications of the term.

The good news is that there are some useful concepts and technologies bound up in the Web 2.0 idea which you should explore; the bad news is that a lot of confusion, hype and marketing trickery is going on.

The term was popularised by publisher Tim O'Reilly in an inaugural Web 2.0 conference in October 2004. The idea that drove the conference was that the bursting of the dotcom bubble was not only an ending, but also a beginning.

O'Reilly and others (many in senior positions at technology suppliers and venture capitalist firms that had benefited from the dotcom boom) contended that despite the collapse of so many companies, the web had gone on changing, and that quietly but steadily a new breed of companies, services and technologies were transforming the online world.

The breadth of the Web 2.0 term means it is best thought of as a label to describe what has been happening in the development web in a specific period of time - from 2001 until the present.

Web 2.0 is a handy piece of shorthand that allows many ideas, technologies and businesses to be hitched to its bandwagon to secure venture funding, column inches or money from unwary customers' wallets.

As a result, there is now a hugely diverse range of companies declaring that they are Web 2.0 houses or sell Web 2.0 products. This is not conducive to gaining a clear understanding of what is going on.

So what is really going on? Well, the web is becoming less a set of discrete online resources which people engage with in a transactional manner, and more a sprawling marketplace where people stay - to talk, to listen, to explore, to learn, to play and to shop - for long periods of time.

I call this "web as place" and think of it as the third wave of development of the web (the first wave was web as library, the second was web as sales channel).

Although bulletin boards and news groups have provided distinct places for people to meet and exchange ideas online for many years, Amazon, eBay and others changed all that by creating storefronts that were wrapped in community services.

They have also fostered large-scale, international communities of shoppers, enthusiasts and business partners with shared interests.

The community-creating innovations made by these companies have now become part of the scenery, and more and more organisations are finding ways to weave community building into what they do.

Wikis, blogs and "social bookmarking" tools (see del.icio.us, Connotea and Furl for examples of the latter) are now being used in some enlightened large organisations to fuel internal information sharing, and augment, replace or kickstart ailing intranet and knowledge management projects.

The peer-production models associated with these technologies can empower employees, given the right training and encouragement, to capture and share knowledge and coordinate tasks in an environment that is productive, yet hosted and managed centrally, in a way that many "top-down" architected intranet projects, with their formalised taxonomies and hierarchies, cannot.

Dresdner Kleinwort Wasserstein is a widely discussed user of these technologies.

Community-building is not just about internal productivity efforts. It is also proving to be an interesting strategy to boost sales, marketing and support efforts. Amazon, eBay and the like may have built their whole businesses around fostering online communities, but the wider world of commerce companies as diverse as BMW and Procter & Gamble have started to enrich their online presences to help learn more about what their customers want, make their customers feel more included, and deliver more tailored products and services.

At the same time some of the technologies that are a feature of web as place are also making online software services easier to use.

Rich user interfaces, built using Adobe's Flash and Flex and various implementations of dynamic HTML and Ajax, are making services more user-friendly along the lines of interactive desktop applications, and employing open programming interfaces to make them comparatively easy to integrate with other applications and services.

The result is a resurgence of hosted application services catching the eyes of organisations small and large. Salesforce.com is only the tip of the iceberg. Companies such as Zoho, 37Signals, and Google (via its recent acquisition of Writely) are now offering easy-to-use and rapidly growing office productivity applications as hosted services over the web.

I have covered multiple ways for organisations to take advantage of the Web 2.0 - and in this small space I have not had space to discuss "mashups", which are also important. Web 2.0 may be a magnet for hype and trickery, but there is more to it than that.

Neil Ward-Dutton is co-founder of analyst and advisory firm MWD

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