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Will Web 2.0 be a boom to eCommerce or a dud?

September 27, 2006

Some will give you an approximate definition of Web 2.0 as being more or less a generic description of what should essentially be a more dynamic Internet experience. Web 2.0 will supposedly offer a whole new range of interfaces, software development tools and various Internet technologies.

With "alphabetic soup names" such as AJAX, .NET, Java and PHP, all aimed at creating new Web sites and communications applications that can more dynamically share and exchange data on the Internet today.

But what exactly is Web 2.0? What will it do that today's Internet cannot replicate? Overall, Web 2.0 is no simple matter to explain, let alone define it. However, if you’ve participated in a discussion blog, contributed to a wiki, or if you subscribe to Really Simple Syndication (RSS) news and information feeds, then you’ve already surfed the Web 2.0 wave!

In this new 2.0 Universe, you set your own parameters: through a dashboard Web page, for example, you can set up active links to on-line communities and various information sources. Or you might set up your own personal collection of discussion threads, personal photographs and any other cyber-items of interest to you, and then reach out to share them with other like-minded surfers.

It’s as much a new approach to building and surfing the Internet as it is a philosophical and social phenomenon. In barely two years of existence, Web 2.0 has rallied a fervent community of commonly interested individuals from around the world who supply their time and insightful content to keep it growing.

But the first question that comes to mind is, is it a place for business? Is it appropriate to post in a blog related to business? “I’ve read quite a bit about Web 2.0, but am frankly very skeptical of the hype growing up around it,” says Charles King, principal analyst with Pund-IT Inc. of Hayward, Calif., an on-line IT and business analysis Web site.

“Using the Internet as a collaborative development and distribution platform isn’t too far-fetched to me, but the rhetoric around how companies intend to capitalize and make money on such a nebulous business model is too reminiscent of the good old days of the Internet boom for my comfort.”

In the same spirit, renowned tech author Nicholas Carr – a former executive editor of the Harvard Business Review whose 2004 book, Does IT Matter? Information Technology and the Corrosion of Competitive Advantage, set off a wild debate about the role of computers in business – says businesses shouldn’t get too excited, least not yet.

“I don’t think there’s any reason to be caught up in the hype or to rush ahead in adopting the technologies,” he says. “There’s little evidence, so far anyway, that Web 2.0 technologies will provide big benefits for companies in general.”

But that kind of criticism hasn’t slowed the enthusiasm of Web 2.0’s supporters. The umbrella Web 2.0 concept was formally unfurled back in October 2004, during a conference in San Francisco.

This first-ever Web 2.0 event was a launching point for a new Internet-based model of information sharing, collaboration and publishing. Among the pioneering speakers who brought Web 2.0 to the fore were heavy-hitters such as salesforce.com chairman Marc Benioff, Amazon.com founder Jeffrey Bezos, 8-bit microprocessor inventor John Doerr, and dot.com billionaire and Dallas Mavericks’ owner Mark Cuban.

Since then, Web 2.0 applications have been stirring the imagination of regular folk and businesses alike with a much richer and more interactive on-line experience. Andre Charland, president of eBusiness Applications Ltd., an application development company in Vancouver, points out that companies such as Nike Inc. and Ford Motor Co. are already using Web 2.0 applications such as blogs for marketing and internal communications.

At the same time all of this is happening, the dashboard concept is being turned into an effective corporate tool for managing business data and information to support applications such as on-line customer orders and sales notifications.

Business successes have emerged. In the space of collaborative publishing and information sharing, blogs and wikis have spawned companies such as Wikipedia, dig, Flickr and del.icio.us. Then there are companies like Amazon.com and Google that have parlayed popularity and profit from the Web 2.0-based search and information tools.

“It’s all about sharing data so that people can do what they want with it,” Mr. Charland says. “I think there’s still the ‘what’s the business model?’ discussion going on,” he admits. But he adds, “All businesses should be taking a look at how blogging can impact their marketing and internal communications or how to use wikis to improve their collaborations.”

Even the skeptical Mr. Carr says the compelling business value of Web 2.0 technologies, particularly blogs and wikis that focus on helping companies build and manage knowledge, is that they’re cheap, easy to set up and easy to use.

“So a company could do a pilot test with little investment and then determine whether the benefits warrant a bigger program,” he says. “That can be particularly attractive to smaller businesses that don’t have a lot of money to invest.”

Richard Iwasa, a development consulting manager with Ideaca Knowledge Services Ltd. in Toronto, says Web. 2.0 technologies offers businesses ways to distribute information to clients through tools such as RSS feeds that allow customers to “pull” up to date information on products and services from the Internet.

There are other useful applications, too, he says. “For a software company, employees who blog can generate interest about their product by talking about how it works, design decisions, or by answering questions and generating another avenue of support for the customer .... For a manufacturing company, employees could blog about techniques or tools they use, which someone out there is bound to find interesting.”

With reward also comes risk, however. Mr. Iwasa points out that these same employees might be too candid about their company’s inner workings or problems, or might reveal confidential and competitive information.

And it requires some effort. Like all things Web, the secret to success in this new cyber-universe is keeping things current, interactive and engaging. Where it may have been enough in the old Web 1.0 days to simply load up on static information and fairly limited website functions, today it’s all about rallying communities and maintaining interest in the Web 2.0 domain.

“I think a lot of the Web 2.0 stuff can be of value to a company that wants to be open and foster communication and collaboration with their customers and partners,” Mr. Iwasa says. “But they can’t just throw up a blog, an RSS feed or a fancy website. Ultimately, the content or functionality they provide must be compelling for people to stick around and participate.”

Source: IT World Canada



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