Web 2.0

The term “Web 2.0″ describes the changing trends in the use of the web technology that aim to improve the way people use the web. This term is based on the concepts of a web-communities “working together” to improve services and create “social networking” sites for sharing information, video, music, blogs and many things. Some people think that Web 2.0 is a new version of World Wide Web but actually it only focuses on the way people utilize the web as a “tool for collaboration”.

Like anything new, there’s a lot of misconceptions associated with Web 2.0 because many people has expressed their views, their wishes in chat rooms and blogs so it is important that you understand what it is when use the term Web 2.0. The early adaptation of Web 2.0 could probably be YouTube, a video sharing website created by three software developers to share short videos with friends. However, this idea of was so popular with million of users sharing and watching it so Google immediately brought YouTube for U.S $ 1.6 billion without figuring how it can make money. (The same thing happened when eBay brought Skype). The concept of “Social Networking” can be defined as “group of people sharing the same interest via a communication network such as the Internet”. The best examples of social networking are MySpace and Facebook where people post their interests, create network of friends, personal profiles, blogs, groups, photos, music, and videos etc. However, Web 2.0 is not just a collection of programming techniques or popular Web sites but collaboration tools to be used within a company or many companies to share ideas, informations using blogs and wikis. Just like mushroom after the rain, every hour thousand of blogs and wikis are being created with people from all over the world sharing, discussing and collaborating on whatever topics that they are interested.

Aside from the “social networking” concept such as blogs, wikis, Web 2.0 recognizes the advantage of the “Software as a service” (SaaS) concept that allows users to access many tools and commercial off the shelves packages via the internet. It also allows vendors to collect information from users. Let’s look at some simple examples: In e-business, to generate more revenue from the marketplace, companies collect information on high-value customers or customers that buy a lot of things. The more they buy, the more company advertises similar merchandises to get them to buy more. (When you buy a book on-line from Amazon.com, you will see advertise that say people who buy this book also buy the following items and urge you to buy additional books). The same concept can be applied to blogs as a marketing/sales tool because that’s what the marketplace pays attention to today. Within the “Social networking” people share their thought, ideas and believe in their peers so instead of advertise products or services, company writes blogs to discuss about their products and convince people to accept their “Marketing blogs”, without knowing. (Amazon is an excellent example of this practice by having so many reviewers for every product they sell). By creating a network of blogs, companies can increase their retention of existing customers by having more frequent online interactions with them without they really know. (Customers believe that they are discussing and sharing their opinions with peers in the virtual world) This data collection is possible in the Web 2.0 and through metrics and statistics, companies can anticipate a customer needs or wishes before they occurs, so that the relationship can be strengthen and defection can be salvaged. Actually, this is nothing new but Business Intelligence using Web 2.0 or “the process of collecting information and combining it in an ‘intelligent way’ to help people make better business decisions.” Another example is the application of Web services API such as the Google Maps mash-up API. As consumers, many of us have seen publicly available mash-ups, such as the combination of Google Maps and the database of apartment rentals or advertising for certain products.

With Web 2.0 environment, companies can create product communities. Most IT people understand user groups, but the term “product communities” is a significant signal that major changes are underway. Today customers are more “techno-smart” than before and they are active usage of blogs, wikis, and YouTube video uploads. In an era of intense global competition, they also share information about products that they buy, whether it is good or bad, whether the company is honest or dishonest so they are well informed. Today user groups or product communities are no longer created by, hosted by, or controlled by the producers of products and services. Today they are more likely to be created and hosted autonomously in the virtual world and, no longer under the vendor’s control.

However there is an issue that underlies much of activity on the Internet: trust. In the virtual world, “trust” is almost synonymous with “reputation,” which is closely related to issues of identity and security. With so many weaknesses and vulnerabilities such as spamming, spoofing, phishing, and other forms of fraud how can people trust a “Social network”? Let’s look at the Wikipedia. In a very short time, Wikipedia has grown larger than the Encyclopedia Britannica (with 1.3 million articles, compared to roughly 100,000 for Britannica) and more popular because it’s free. Many people ask why we should trust the information we find on Wikipedia. After all, anyone can create a new article or change an existing entry, so how can we be sure that a Wikipedia article wasn’t created by an uneducated person or someone with a conflict of interest? With Web 2.0, you need to think about identity, trust, and reputation because they are the “core concepts that structure a society and the interactions between the members of that society.” In practical terms, e-business and meaningful interactions on the Internet cannot take place unless we have a degree of confidence that we know the individual that we are sharing with or company we do business with, have a good reputation.

In conclusion, what we discuss in class today provide you certain perspectives on the exciting world of Web 2.0. I hope by study these issues you will understand that Web 2.0 is more than merely social networking sites like MySpace or YouTube but can be used for many things such as business intelligence and collaboration tools. It is important for you to think how to take advantage of this new technology and apply it to your business.

Creating Business Value with Web 2.0.


  • Blogs of Prof. John Vu, Carnegie Mellon University
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