I’m excited to see so many new faces at DEMOfall 08 this week. Iin fact, this is the biggest DEMOfall event we’ve ever
had. Most importantly, it’s just the size we like it: Lots of great people to meet without overwhelming crowds and
noise. Seventy-two amazing companies and products from across a very broad spectrum of the information
technology market, with plenty of time to hear from each one of them and get up close in the pavilion.
Let’s make these next two days all about them. They have been working tremendously hard to get their products
ready for market and to introduce them to you today. The products and the companies: they deserve our respect and
focus. If we give them that focus, they will tell us a tremendous amount about where the technology markets are
going.
While the 72 products coming to market at DEMOfall represent a wide range of capabilities and impacts, without
question the most obvious take away is that the tech market is moving into a new cycle. To understand this new
cycle, though, let’s look at its historical context.
The first Internet cycle – what we might truly call Web 1.0 -- was the Flat Web. It was all about displaying pages of
text, maybe some graphics. It was about informing and about information discovery. It was, in reality, the original
vision of the Web.
The second cycle – the one I think was the real Web 2.0 - was the Transactional Web, the sites that offered some
kind of interaction with customers. Ironically enough, this interaction was often the capstone on a customer
engagement, typically the financial transaction. In short, the Transactional Web was about buying things.
The third cycle – what is popularly called Web 2.0 – is the Social Web, where content and context and consumers
combine to create a user-driven experience. In this most recent phase – the one now coming to a close – power
shifted from the site owner to the site user. And, for better or ill, we all found our voice.
The coming forth cycle is built on that foundation, but before I talk about where we are going, indulge me to
emphasize where we have been.
You see, Web 2.0 isn’t about a set of technologies so much as it is about a set of values. It’s been about sites and
businesses developed on open source and open APIs. It’s about capital efficiency and viral growth and the gestalt of
“free.”
These values inflated a hype bubble, not an economic one, a supposition that bears out when you compare the
wealth creation of the Web 2.o cycle to the wealth derived in previous cycles. Simply put: there are very few Web 2.0
millionaires. And certainly not by comparison to those organizations and entrepreneurs that grew and grew rich in
previous cycles:
• Netscape, Yahoo!, AOL and others in the Flat Web
• Macromedia, Adobe, eBay, Amazon in the Transactional Web. In fact, the Transactional Web spawned dot.com
millionaires like guppies.
But Web 2.0? We have more notoriety, more fame, in this cycle, but not more wealth. And I’d argue that the
fundamental difference is that this time, hype doesn’t create market value, and without that extra boost, the business
models of the vast majority of Web 2.0 sites don’t support true wealth creation.But more importantly than making a
few entrepreneurs rich is the reach of the Web – and again I would argue that here the Web 2.0 cycle has fallen
short.
While more people are using the Web today, the social web hasn’t broken out of its echo chamber. Today, a
relatively small number of people – tens of millions maybe, but certainly not even a slim majority of people - are avid
consumers of Social Web content.
The barriers that prevent Web 2.0 companies from reaching the mass of 100s of millions of users are the lack of
transparency and trust, the convenience of access, basic ease of use, and real choice. In the next phase of the
Web, these barriers will come down.
But let’s be clear: Web 2.0 has laid the foundation for the next, really big growth phase: The Distributed Web.
The Distributed Web is about syndication, integration, distribution. It’s about reaching out from one place and being
present in every place. The Distributed Web assumes connectivity virtually everywhere. It assumes the objectification
of applications and data so that both can be delivered on demand where ever and how ever the consumer wants or
needs it.
We don’t get to the Distributed Web with a desktop computer and a browser paradigm – at least not completely. The
Distributed Web depends on devices and protocols and tiered networks, both physical and conceptual. It is the
network of computers and it is the network of things.
We are entering a period where distribution and syndication trump aggregation, meaning and finding trump keywords, and searching, applications and data are componentized and available everywhere, hardware devices and services
that run on them are indistinguishable, and where business models are real, transparent, and open.
In this next phase, we take the community of Web 2.0 and hone it into a sharper weapon, one that supports collaboration for a purpose, be it business or social. One that delivers information in anticipation of interests and needs. One that reaches beyond the elite early adopters to captivate the imaginations and fulfill the desires of people whose lives are focused on the every-day tasks of work and family, of information and entertainment.
We are embarking on a new cycle, a new phase, a new period of growth, supported by real business models that hold up in both good and challenging economic cycles.
And while Web and mobile technologies are integral to so much of the forward movement of the market, they are not
the only market shapers. Throughout this DEMOfall 08 event, we will see important advances in usability, security,
interoperability, computational capacity, and even a few outliers that point the direction to a greener, brighter, smarter
future.
All of these things will come together to drive the next – significant - cycle of growth in the information technology
marketplace.
