News

Web 2.0 transcends the hype for business and IT

• By John K. Waters
• May 23, 2006

We have yet to agree on a sharp-edged definition of "Web 2.0," but many of the technologies coalescing around this loosely defined, hyper-hyped buzzword—everything from Web services, the Ajax Web development technique, and service syndication, to wikis, tags, podcasts, and even blogs—should begin figuring into every IT leader's business strategy.

In fact, say analysts at Gartner Research, all revenue-generating channels should be operating in a Web 2.0 architecture by 2008.

Gartner VP and Fellow Kenneth McGee puts the onus for this change on enterprise architects, and believes that now is the time to begin embracing Web 2.0, because an organization's ability to understand and adopt Web 2.0 technologies and models are fast becoming a competitive differentiator, and those technologies and models are well on their way to the business mainstream.

But this is a tricky transition. Web 2.0 represents a fundamental shift toward a more open, flexible, and participatory model for creating content systems and business models. And the technology is only part of that picture, explains David Mitchell Smith, Gartner VP and fellow. To make the most of this thing called Web 2.0, companies must learn to exploit what Smith calls its "social dimension."

"Adding these new aspects requires rethinking the design of the system and possibly its target audience," Smith says. Web 2.0 is probably less about the technology than it is about a way of architecting software and businesses that recognizes the Web as a real information ecosystem.

You might not be ready to embrace concepts like "social computing" or "participative computing" in your organization, but it's clear that Web 2.0 can no longer be dismissed as hype. In fact, it figures prominently in Gartner's latest list of key actions IT leaders should take over the next three years to demonstrate value to their organizations.

"The next three years will place an extraordinary amount of pressure on IT organizations challenged to continually show members of the entire enterprise that they deliver value sufficient to warrant remaining an intact organization," McGee says. "To do this, IT executives must do more than just cut costs. They must deliver value that is measurable and of significant importance to the enterprise."

McGee and Smith shared their ideas on the business value of Web 2.0 at the annual Gartner Symposium/ITxpo, held in San Francisco last week. To clarify the broad impact of Web 2.0, Gartner has divided the concept into three key focal points:

• Web 2.0 architecture focusing on the Web's technology architecture and development model, which Gartner defines as a subset of SOA, and provides a globally linked, decentralized model that is network-centric and extensible. Web 2.0 architecture is currently characterized by technologies such as Ajax and composite apps delivered as mashups (a trendy term for a Web site or Web app that combines content from one or more sources).

• Web 2.0 community, focusing on the fundamental shift in the ways in which people use technology to interact with each another and with businesses. It refers to a participatory approach, in which users are not simply service and content consumers, but also act as content and application creators, becoming a kind of networked collective intelligence. Web 2.0 communities are characterized by the use of collaborative authoring models (wiki, blogs, and podcasts) and social-network community models (MySpace, TopCoder) that will increasingly shift more power to the consumer.

• Web 2.0 business, focusing on the Web's business processes and deals with the previously described, fundamental shift in the way in which businesses deliver value. The business side of Web 2.0 is all about empowering third parties and consumers to repurpose content and services in new and unique ways. It relies on an open and extensible business ecosystem that embraces a greater reliance on, and collaboration with, externalities. It also employs new legal structures for IP, such as open software licensing; new economic paradigms, such as advertising, usage, and subscription; and derivative revenue models, such as revenue sharing. Web 2.0 business models will "enable nimble new competitors to succeed and challenge established enterprises to adapt to survive," Gartner says.