Web 2.0: Making Friends / Web 3.0: Making Money

Web 2.0 is really at its core about user interface. Interface technologies such as Flash and AJAX have allowed web pages to be more active and engaging and to really become application-like. By and large, we have used this power to make social applications. Unfortunately while these social applications are entertaining, they are, for the most part, not making us money, and they are not providing any great enhancement to our productivity. In fact many would argue they are robbing us of our productivity.

But Web 3.0 is different. Web 3.0 is about the data. In a Web 3.0 world there are no silos between applications and data objects in application “A” can be connected to or related to items in application “B”. This is really just a natural extension of the concept of the mashup. Web 3.0 is about allowing for data across applications to be organized so that it becomes useful information.

Many people will refer to the Web 3.0 as the Semantic Web. I don’t use that term because it is tied to certain specific technologies from the W3C standards organization, but the concept of Web 3.0 is much bigger than one set of technologies or specifications. In fact the W3C Semantic Web specifications do not actually cover all of the requirements for making your application data open, and so companies are appropriately inventing their own solutions. One amazingly powerful example of this is Yahoo’s new Yahoo Query Language(YQL), which, through one language, gives access to huge parts of the yahoo data universe.

Ok, so how does open access to data and new organizations for data lead to making money?

It’s simple. When you properly organize data, you can extract actionable information that leads to profitable or productive decisions. There are two types of value that can be extracted from hyper connected data: direct value and indirect value.

• Direct value is value that you get from realizing that there is a relationship between two items that your human mind would not have made. For example, imagine receiving a new email from a potential customer, and having the application be able to tell you (perhaps in a rollover) that this prospect is someone who you met at a get together last year (because it was on your calendar) and that you have several friends in common. That little bit of information might be enough to help you make that sale. In previous articles I have referred to this concept as serendipity.
  
  
• Indirect value is value that may be derived from *analyzing* the connections between objects in your data universe, typically using some kind of machine learning techniques. For example, imagine collaborative filtering, but applied not just to your book or movie purchases, but across your entire life. For an overly simple scenario, such a system might be able to suggest, based on the fact that you read a lot of books on Australia, that an airfare sale by Quantas might be of interest to you. This is only possible in a Web 3.0 world where activity stream data is accessible across all of your applications, and is not just locked into one service.
  

In summary, Web 2.0 was about making the web a compelling application interface platform. And now, in this Web 3.0 phase, we will be leveraging that interface platform combined with open data interfaces. This combination will yield services that help us to live more productive and profitable professional and personal lives. As I see it, this is the *real* Internet revolution.

If you want to participate in this discussion, we will be talking about how to profitably leverage Web 3.0 at the Web 3.0 Conference in Santa Clara, CA October 16th and 17th.