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Web 2.0: Business in a Connected World
By Steve Bannister

Welcome to a new internet revolution known as Web 2.0. This internet renaissance uses powerful on-line based services as platforms to effectively and efficiently connect people throughout the world. The resulting new social networking phenomenon has provided a significant swing of power (political, consumer, etc.) back to the people. Consequently, Web 2.0 has forced businesses to redefine again their role in the new economy of the internet age.

Taking up "Space" on the Net

MySpace.com began in October 2004 when Tom Anderson and Chris DeWolfe created a "virtual hang out" where their friends and a few local music promoters could express themselves by posting profiles, photos, music, video-clips, blogs, and links. Chris and Tom's "friends" now total over 100 million with the hardcore users being teens and twentysomethings (along with over 2.2 million bands, 8,000 comedians and thousands of filmmakers). MySpace has exploded into a cultural phenomenon accounting for more than 82% of traffic in its category (according to www.hitwise.com).

In July 2005, the global media mogul Rupert Murdoch made MySpace, "HisSpace" by purchasing it for $580 million. Now the task for Murdoch is to determine how to make a truly user-driven, grass-roots phenomenon safe for advertisers. The main advertisers so far include international companies such as Coke, Pepsi, Procter & Gamble, plus the major automakers, mobile phone carriers and film distributors. As long as the approach is soft sell, with a heavy emphasis on entertainment, there will be limited backlash by the users who ultimately have the final control over MySpace.

In an effort to keep more eyeballs glued to their site and thus court more advertisers, MySpace continues to work on and create more links, which will appeal to its target audience. These include MySpace Music, Film, Comedy, News, Sports, Fashion, and the list goes on. The marriage between the connected internet culture of MySpace and Murdoch's quest for profit will be an interesting one to watch.

The Revolution of Video

Sharing digital pictures via the internet has long been a common practice (see www.flickr.com) but Steven Chen and Chad Hurley wanted more; they wanted to create a website whereby friends could easily share home videos. On February 15, 2005 YouTube.com was born. YouTube is a free video sharing website which lets users upload, view, and share video clips. Viewers can rate videos and rating results are published on the site.

From the beginning, YouTube began enjoying unprecedented numbers. Today over 100 million clips are viewed everday and an additional 64,000 videos are uploaded each month. No doubt, numbers like these caught the attention of the big internet players, in particular, Google. On October 9th, 2006, google purchased YouTube for 1.65 billion dollars.

Once again, the MySpace dilemma arises for YouTube; how to make money. With a $1 million dollar a month price tag just to keep YouTube operational, Google has been using all of its resources to do its part to redefine internet advertising. Chen and Hurley are adamant about keeping YouTube in the users hands by refusing to allow advertisers direct access inside posted videos. This leaves only viral marketing campagns whereby businesses post catchy videos which discretely contain their product or service and hope that people will watch and share. Humm...an advertisement that people want to watch? What a great idea!

LinkedIn or Linked Out

Social-networking has been great for teenagers and twentysomethings, but not of much use to businesses. Enter LinkedIn.com; a MySpace for grown-ups. LinkedIn (a privately held company started by Reid Hoffman) allows registered users to maintain a list of contact details of people they know and trust in business. Users can then use LinkedIn to find jobs, people and business opportunities recommended by anyone in their trusted contact network. Essentially, LinkedIn acts as a catalyst for business relationships.

With projected users to top 8 million by 2008, and an increase of added features and versatility, LinkedIn is positioned to become the predominent profesional networking force on the internet. It will soon be as important a tool as the blackberry is today.

Blah, Blah, Blah, Blog

Blogers, posting comments to a blog, reading blogs, entering the blogosphere...blah, blah, blah,...what is all this hype over blogs and what is a blog anyway?

Simply put, a blog (a blend of web and log) is a user-generated website where entries are made in a journal style. Blogs provide commentaries on particular subjects (politics, news, fashion, technology, ...) which are posted to a bloggers website. The unique feature of a blog is the ability for readers to read an entry and post their comments. Most blogs are in text form although there are other types of blogs which primarily use photographs (photoblogs), sketches and drawings (sketchblog), videos (vlog), or audio (podcasting).

Businesses have gotten up to speed on blogs by writing corporate blogs. Corporte blogs can be used internally to enhance the communication and culture in a corporation or they can be used externally for marketing, branding or PR purposes. Blogs are great communication tools for businesses when things are going well. Unfortunately, when business is suffering things can turn ugly if blogs are not used correctly.

Once a corporation steps out into the blogoshpere there is no turning back. If a company attempts to hide any wrong-doing then bloggers will eventually find out resulting in a powerful backlash from the blogging community. Remember that bloggers want people to visit their blogs too, so they search the internet for any juicy information that they can find. Rest assured, people are always watching and there is no longer anywhere to hide.

As the old saying goes, "If you can't beat'em, join'em". The new breed of transparent CEO's are beginning to embrace blogs and as a result they are discovering that customers will respect their honesty. Companies' reputations are now made or lost online where the object of the game is to frequently provide interesting material and to remain transparent. Bob Lutz of GM emphasised this point when he was quoted in Information Week as saying; "To blog or not to blog? For a lot of senior executives these days, that is the question. The answer, simply enough, is to blog. No better opportunity exists to engage in an open dialogue and exchange of ideas with customers and potential customers."

Get a Another Life

More specifically, get a "Second Life". Second Life (www.secondlife.com) is a virtual world created using an interactive software program developed in 1999 by a San Francisco-based company, Linden Lab. Its residents (fast approaching 6 million), known as avatars, are purchased using Linden dollars which can be converted to real money ($270Linden = $1.00 US). This virtual world, comprising of a landmass over 250 square kilometers, offers 16-acre private islands for $1,250 ($980 for educational institutions and non-profit groups).

Originally, a playground for gamers and technology buffs, the Second Life world has sparked the interest of many other organizations such as Duke University, the Sundance Film Festival, and Democratic presidential contenders Barack Obama and John Edwards. A number of global companies have also signed on namely, Adidas, Circuit City, Dell, IBM, Sears, and Toyota. Most of these companies are using Second Life as a retail incubator. IBM took things a step further recently when it purchased 24 islands, that will be used to run training and recruitment sessions for employees stationed around the world. Is Second Life a glimpse of the new global economy? Only time will tell.

Where to go From Here?

The following are some suggestions of how to use the power of Web 2.0;

Use blogs as a business resource (www.blogsforsmallbusiness.com and www.blogbusinesssummit.com)
Start an internal and an external blog (www.movabletype.org, www.blogger.com, or www.typepad.com)
Become a member of LinkedIn (www.linkedin.com)
Join a small business on-line discussion forum (www.sbinfocanada.about.com/mpboards.htm)
Create short commercials and post them on YouTube (www.youtube.com) as well as posting it on your own website or blog
Become inspired and stay on top of global trends by viewing one video a day from www.ted.com. What is TED? Excerpt from TED's website: "TED stands for Technology, Entertainment, Design. It started out (in 1984) as a conference bringing together people from those three worlds. Since then its scope has become ever broader. The annual conference now brings together the world's most fascinating thinkers and doers, who are challenged to give the talk of their lives (in 18 minutes)."

Me Inc.

This incredibly connected world will continue to effect traditional business culture in dramatic ways. The famous business guru, Tom Peters had this to say about the future of traditional employees and business culture in general; "At least 80 percent of white-collar jobs, as we know them today, will either disappear or be reconfigured beyond recognition—in just the next 15 years. White-collar employment as we've known it is dead. Job security as we've known it is over." (This quote came from Peters' book Re-Imagine!, which was printed four years ago.)

Peters' prediction is ringing true. Interconnectedness has opened up a world of business opportunities. As a result, people are beginning to view themselves as their own boss. Work will continue to morph into a series of projects, which could possibly involve team members from all parts of the world. These members will come together (not necessarily in person) to work on a project and then disband when the project is completed. People will be free to work with whomever they want, wherever they want and whenever they want. As Thomas Friedman stated in his book The World is Flat, "...Every person, just as every corporation, must tend to his or her own economic destiny, just as out parents and grandparents in the mills, shoe shops and factories did."

Web 3.0?

The power of the internet is quickly extending to mobile devices. The estimated 700 million people who are online worldwide pales in comparison with over 2.1 billion people who own cell phones. Rich Templeton, CEO of Texas Instruments (which makes the chips at the core of most of the world's mobile handsets) predicts that 4 billion people will have mobile devices by 2010.

As people become more connected, they become more aware of global inequities. As a result, the traditional global hierarchy will be forced to collaborate with the collective intelligence of its connected global citizens: the results can only lead to a better world.

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