encoded notions

People in the tech arena are talking about the possibility of the rise of a new Bubble. It sounds like the general theory is that if and when the Bubble breaks, it won’t be as messy as the first tech Bubble:

The dot-com model was inherently flawed: a vast number of companies all had the same business plan of monopolizing their respective sectors through network effects, and it was clear that even if the plan was sound, there could only be at most one network-effects winner in each sector, and therefore that most companies with this business plan would fail. In fact, many sectors could not support even one company powered entirely by network effects. [src]

So if we’re in the era of a new tech Bubble, what is the inflationary concept at the root? In my opinion it’s a proper understanding of a new buzzword: web2.0.

Web2.0

I hate this term, and other people are of a similar mind about it. Unfortunately for us all, people who drink the marketing Kool-aid think it’s wonderful. For them, it’s an easy sell. The 2.0 makes it feel new and a necessary thing to go after. I think it imposes some sort of discrete evolutionary concept to the web. Does this mean what we used to surf around on and waste time with was in some way inferior as Web1.0?

All this and I haven’t even gotten to explaining what it is.

The problem with describing web2.0 is that it doesn’t really have a fixed meaning per se. Web2.0 is like this fuzzy bundle of philosophies, feelings, technologies, and business practices. I’ll summarize my own personal idea of web2.0:

• People matter.
• Collective intelligence in some cases is very useful as James Surowiecki discusses in his book The Wisdom of Crowds.
• People care more about local effects than global.
• Conversations are important.
• Rigid organizational structures are bad (tags are good, categories are bad).
• It’s okay to charge people for a service if the service is worth paying for from the end-users perspective.
• The Long Tail is actually important.
• chmod 777 web

Flickr and Del.icio.us are two very prominent examples of these web2.0 attributes.

People use the sites to organize and tag their own photos and bookmarks in a way that makes sense to them personally. It’s only as an aftereffect can you choose to examine the Global quality of these Local decisions by looking up a global tag page. Flickr offers a forum area where they can directly interact with their users. Both del.icio.us and Flickr are free services at first. Of the two, only Flickr requires you to pay a subscription fee to make complete use of the site. But since Flickr has such high value as a service, a great many users eventually decide to pay for their services.

Interestingly enough, of the companies that survived the first tech Bubble, most of the big ones were already thinking in this new web2.0 mindset:

Amazon.com

Amazon doesn’t need to decide which books to put on its shelves. Since it’s shelves are all virtual it can hold an infinite number of books and service the entire length of the Long Tail of consumers. That way if someone in a niche field wants a book on Japanese duck painting Amazon will be ready to sell it to him. Other bookstores can always special-order such books for its customers, but there’s a missing aspect of discoverability. Amazon provides an excellent search engine for books and offers a great recommendation engine gleaned from the book-buying decision of millions of individual customers (wisdom of crowds).

eBay

eBay also services the Long Tail of both buyers and sellers. It enables a 46 year-old used-gum collector in Ontario an easy route to sell his goods to crazy people in Denmark with little hassle. eBay was not afraid to charge for their service with nominal listing fees and that’s enough to generate some serious revenue when summed over all of its users and auctions.

Google

Google saw the value embedded in the hyperlinked structure of the internet to derive the wisdom from the aggregate web population to discover relevant search results

Yahoo

I haven’t quite figured this one out yet.

Emergent behavior

Since I read both Emergence and Linked back to back, I’ll just say that a majority of this section comes from those two books (wonderful books by the way).

Ant colonies are cool. Individual ants tend to do their own thing. While they walk, they tend to emit certain types of pheremones that linger behind them. Other ants, upon recognizing these pheremone trails will tend to follow them. Pheremones are how ants communicate. The more ants follow the same trail, then the stronger the scent will be and that path will become popular. Somehow what emerges from this collection of pheremones and ants in the dirt is a functional system of interconnected tunnels arranged in a logical fashion that no single ant could sit down and plan out down at the local city planning office. In one controlled case where ants were confined to a large boxed region of dirt:

“Look at what actually happened here: they’ve built the cemetery at exactly the point that’s furthest away from the colony. And the midden [trash-dump area] is even more interesting: they’ve put it at precisely the point that maximzes its distance from both the colony and the cemetery. It’s like there’s a rule they’re following: put the dead ants as far away as possible, and put the midden as far away as possible without putting it near the dead ants.” (Emergence, p.33)

There’s no central control issuing orders to do this, it’s just an emergent behavior from each ant following a very small set of rules and “listening” to the pheremone trails of his fellow ants.

So was the Web (circa 2002-2003) a macroscopic version of humanity’s colony with the links between pages being “pheremones”? The answer is: not quite. The reason is that only a small group of people (webmasters) were actually making the majority of the linkages between pages. Most people who used the web were doing so in a read-only manner. That being said, it still had some significant information hidden in that link structure (i.e. Google’s pride and joy: PageRank).

The point behind “chmod 777 web” (for non-geeks that roughly translates to making the web a read AND write environment that also lets you run programs) is that web2.0 encourages letting the average user contribute to the structure and content of the web itself. Whether it be by blogging, posting photos online, keeping track of your bookmarks online, or a myriad of other things, the trend is that every “ant” on the web finally has the chance to leave his own “pheremone trail”. This can only mean that the web is going to slowly accumulate more interesting emergent behaviors and statistics.

A Theory

To close out this segment of my observations about the current state of the web, I’m going to answer a question that was bothering me after the Blogger, Keyhole, Writely, Flickr, and del.icio.us acquisitions: Who will win? Google or Yahoo?

My answer: Google and Yahoo aren’t even in the same business (if you discount their search engines). In my model of the web, I think Yahoo is trying to monetize the ants and Google is trying to monetize the pheremone trails.

Yahoo’s acquisitions seem to center around people and community. Google seems to have always distrusted people as providers of metadata and content preferring to just trust the data that’s already on the web.

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I’ve got more to say on tagging, feedback loops, and the Semantic Web, but those topics will have to wait—this post is already long enough as it is.