All Things Digital

If the defining characteristics of Web 2.0 are “groundbreaking” Facebook widgets, easy access to dumb capital and haughty start-ups dangerously over-leveraged on other companies’ assets what (or who) will define the Web 3.0 epoch?

The answer’s obvious isn’t it? Salesforce.com CEO Marc Benioff.

Why? Because he says so, that’s why.

Speaking at the company’s DreamForce Europe event, Benioff said that Web 3.0 will be the Platform-as-a-Service (PaaS) era. A fascinating definition–convenient too, since this is precisely the sort of business Salesforce.com (CRM) is in. “We think Web 3.0 is now upon us. It’s the era of platforms,” said Benioff. “New platforms are coming right out of the cloud. It’s time to make a choice. You can continue to build your applications in the software model or you can move your applications to the new model of cloud computing. There is a new way to build your applications.”

So Web 3.0 is not, as Tim Berners-Lee, inventor of the World Wide Web, once suggested, the semantic Web–”day-to-day mechanisms of trade, bureaucracy and our daily lives handled by machines talking to machines.” Rather, it’s Web 2.0 with another 1.0’s worth of marketing BS. The “Whatever-I-Say-It-Is Web”–the “Al Franken Decade” of the Internet age.

Well, the “me” decade is almost over, and good riddance, and far as I’m concerned. … That’s right. I believe we’re entering what I like to call the Al Franken Decade. Oh, for me, Al Franken, the ’80s will be pretty much the same as the ’70s. I’ll still be thinking of me, Al Franken. But for you, you’ll be thinking more about how things affect me, Al Franken. When you see a news report, you’ll be thinking, ‘I wonder what Al Franken thinks about this thing?’, ‘I wonder how this inflation thing is hurting Al Franken?’ And you women will be thinking, ‘What can I wear that will please Al Franken?’, or ‘What can I not wear?’ You know, I know a lot of you out there are thinking, ‘Why Al Franken?’ Well, because I thought of it, and I’m on TV, so I’ve already gotten the jump on you.”

Sen. Ted Stevens was right: The Internet is not a big truck. It’s “a series of tubes”–tubes that can be filled to capacity by “enormous amounts of material.” And, according to AT&T, that’s going to happen about two years from now.

In remarks at the Westminster eForum on Web 2.0 this week in London, Jim Cicconi, vice president of legislative affairs for AT&T (T), said the Internet will hit its capacity in 2010. “The surge in online content is at the center of the most dramatic changes affecting the Internet today,” Cicconi said. “In three years’ time, 20 typical households will generate more traffic than the entire Internet today. We are going to be butting up against the physical capacity of the Internet by 2010.”

Clearly, some bigger tubes are in order here–$55 billion worth of them, according to Cicconi, who was quick to note that it will be companies like AT&T footing the bill for them. “There is nothing magic or ethereal about the Internet–it is no more ethereal than the highway system,” he said. “It is not created by an act of God, but upgraded and maintained by private investors.”

Ah yes, private investors. Like the ones who promised in the mid-1990s to provide fiber-optic connections to millions of households across the country in exchange for some $200 billion in tax cuts? The ones who never delivered on that promise, content to pocket direct tax credits of, on average, $2,000 per subscriber, without fulfilling their end of the bargain? Those investors?

Here’s a clever way of streamlining the acquisition process: Become a platform-as-a-service provider and encourage developers to create Web applications using your proprietary database and your APIs (application programming interfaces).

That seems to be what Google (GOOG) has done with App Engine, a new service for developers who’d like to write and run their Web applications on the company’s infrastructure. With App Engine developers can establish their own little Google Labs outposts, building Google-friendly applications using Google’s own building blocks on the Google File System and Google will handle the scaling and fail-over issues.

That’s a compelling proposition–assuming you want Google to control your entire end-to-end development environment. And who wouldn’t these days? What better way to pique the search giant’s acquisitive interests than building a great big Web 2.0 sandcastle in its very own Web 2.0 sandbox? Who knows, you may be the next YouTube or, at the very least, the next Zingku or Jaiku. And if it turns out that you are, how convenient would it be for Google to acquire you, as Dave Winer noted a while back at Scripting News:

How much would it be worth to buy companies without having to transition their technology to their platform? There would be no retraining either, all the programmers in the companies they acquire would know how to work in the environment. Further, can you imagine that they’d charge universities to teach comp sci using their cloud?

“Given the cost of acquisitons, recruiting and training they can afford to blow a lot of money on free bandwidth, storage and CPU to make the buying and hiring process more efficient and increase the hit rate (the percentage of programmers who work out).”

According to last year’s safely-looking-ahead-to-the-year-to-come lists, 2007 was to be “a year of hyperdisruption for the technology industry”; it was to be “a year of significant developments” and “a year of evolution”; it was to be “a year of invention and innovation,” “a year of experimentation” and “a year of slow, but significant, change”; it was to be “a year of carnage,” but it was also to be “a year of great happiness and multiple blessings.” Above all, 2007 was to be “a busy year for technology.”

Which, as you’ll see below (and in our companion video), is pretty much how it turned out. What follows is Digital Daily’s abridged guide to the year in tech news–a fond reminiscence of what was, and our First Annual Year-End List For Year-End List Haters.

1. Yahoo Shareholders Reject Plan to Tie Executive Compensation to Company’s Crappy Performance
   Well, what do you know: Yahoo’s annual shareholder meeting didn’t conclude with CEO Terry Semel’s head piked on the exclamation point of the Yahoo sign outside company headquarters.

2. I Know It Was You, Fredo. You Broke My Heart. You Broke My Heart!
   Apparently, Fred Anderson is the “Fredo” of the Apple options backdating family.

3. We’ve Asked John Williams to Do a Special Performance of the Theme From “The Poseidon Adventure” for Our Q4 Results
   Who’s programming Microsoft’s on-hold music, Apple’s Phil Schiller? Waiting for the company’s third-quarter earnings call to begin yesterday, those listening in were treated to an instrumental piano version of Celine Dion’s “My Heart Will Go On.” From “Titanic,” the disaster movie.

4. I’m Proud to Say Our New “Soylent Green” iPod Is Made of 100% Biodegradable Greenpeace Activists!
   If you’re going to try to smear Apple for reckless environmental practices, you best have some hard epidemiological and toxicological data on hand, because goofy Photoshop treatments of the company’s marketing materials just can’t stand up to a blow from the Apple PR machine.

5. And Online Display Impressions Soared as More Americans Checked Their AOL Accounts for Old Times’ Sake
   To hear tell from Time Warner executives, the company’s better-than-expected earnings for the first quarter owed quite a bit to gains in online-advertising market share by its AOL Internet division.

6. Web 2.0 Audience in Mirror May Be Smaller Than It Appears
   How ironic is it that Web 2.0–the “participatory Web”–has far fewer participants than its architects would have us believe?

7. And for My Next Trick, I’ll Turn Myself Into a Complete Jackass
   If you’re going to demand that YouTube remove a video to which you object under the Digital Millennium Copyright Act, it’s probably wise to make sure that you actually understand the DMCA.

8. War Is Peace. Freedom Is Slavery. Ignorance Is Strength. DRM Is DCE.
   You can’t put frosting on manure, but HBO’s Chief Technology Officer Bob Zitter isn’t above trying.

9. We’re Naming It the Motorola STNKR, After Our Q1 Earnings …
   Carl Icahn was right. Motorola really is desperate for a new product. How else to explain a patent the company was awarded last month for a “communication device having a scent-release feature and method thereof.”

10. The Frienemy of My Frienemy Is My Enemiend
    If Microsoft is planning an acquisition in the online marketing and advertising space, it better act fast, because if it waits much longer there won’t be anything left to acquire.

11. How Would Monsieur Ellison Like His BEA Served? Mixed in a Bucket With Oracle’s Other Acquisitions?
    Looks like we may be in for another PeopleSoft-esque takeover drama …

12. I’m Just Biding My Time Here Until I Can Quit and Study Whale Feces Full Time
    Given the chance, how would you alter the course of your career? Well, if you worked at Microsoft’s Security Response Center, you might consider taking a job as an Olympic drug tester, a gravity research subject, or a “whale-feces researcher.”

13. Much Like Energy, BS Cannot Be Created or Destroyed, It Can Only Be Changed From One Form to Another
    If Steorn’s perpetual motion effort is anything like its e-commerce venture (and by all accounts things do seem to be going that way), the only thing in its future is insolvency.

14. From Now On, We’ll Be Known as Nlsn/NtRtings
    Looks like vowels won’t be the only accoutrements to be tossed aside in the rise of Web 2.0. The venerable page view is to be abandoned as well.

15. The Defendant Stands Accused of Copyright Infringement, Breach of Contract and Misappropriation of Dumb Luck
    According to popular legend Facebook founder Mark Zuckerberg once kept two versions of his business card in his wallet–one with the title CEO, the other with “I’M CEO . . . BITCH.”

16. Well, Here Come YouTube’s Video ID Tools. Guess That Means Godot Will Be Here Any Minute Now
    Google’s apparently finished “educating users about copyright law” and has moved on to the far more important business of making sure not to run afoul of it.

17. Look at It This Way: Now That Yahoo’s an ‘Ecosystem,’ the EPA Can Finally Declare It a Superfund Site
    “Our financial performance is not what we would like to see long-term.” This, from Blake Jorgensen, Yahoo’s chief financial officer who, just six weeks into the job, is already well versed in the company’s fiscal truisms.

18. Gates to Google: My Lyrical Technique Will Leave Your Body Weak
    Much as Microsoft Chairman Bill Gates fancies himself untroubled by Google’s incursions into his software empire, they clearly do chafe him a bit.

19. Newest Yahoo Mail Feature: BCC Beijing
    Sure, Yahoo signed China’s “Public Pledge on Self-Discipline for the Chinese Internet Industry,” a voluntary agreement to monitor and restrict information deemed “harmful” by Beijing, but did it have to take it quite so seriously?

20. Apple: Wham, Bam, Thank You Fanboi
    “I feel like a $200 whore.” That was one iPhone early adopter’s crass assessment of his feelings of self-worth, after Apple unexpectedly cut the price of the device by a third–just two months after it arrived at market.

21. In the Unlikely Event of a Water Landing, Sergey’s California King May Be Used as a Flotation Device
    With its onboard hammocks, full-size sofas and California King beds, it’s a wonder Google’s “party plane” has room for scientific instrumentation befitting the National Aeronautics and Space Administration, but apparently it does.

22. Act Now and Get a Downgrade to the OS You Really Want, ABSOLUTELY FREE!
    It’s looking more and more like the pent-up demand for Windows Vista we’ve heard so much about this past year is really just pent-up demand for Windows XP.

23. Dude, I Work for Friggin Forbes Magazine. Have You Heard of It?
    The year-long guessing game is over. New York Times reporter Brad Stone has outed Daniel Lyons, a senior editor at Forbes magazine, as the author of the Secret Diary of Steve Jobs, the satirical blog lampooning Apple’s iconic CEO (See? Told you it wasn’t me).

24. If Facebook’s Worth $15 Billion, Then My Stupid Idea’s Got to Be Good for $10 Mil
    Apparently the vainglory from which Facebook CEO Mark Zuckerberg appears to suffer is communicable and spreading rapidly throughout the social network’s developer community.

25. A Billion Here, a Billion There, and Pretty Soon You’re Talking Real Bollocks
    MySpace is worth $65 billion in the same way that Facebook is worth $15 billion–hypothetically.

26. “Apple Has Destroyed the Music Business”–Not That We Didn’t Try Our Best
    Many, many years ago, when the digital-music business consisted of little else besides Napster and the Recording Industry Association of America’s lawsuits against it, Apple proved that there was indeed a decent business to be had in selling music online for $1 per song.

27. It’s Not an Unpaid Endorsement, It’s a “Social Ad”
    Facebook’s Social Ads aren’t endorsements, they’re a “representation” of user activity.

28. Obama Announces “No Tech Policy Left Behind” Plan
    If Google’s mission is to organize the world’s information and make it universally accessible and useful, then Democratic presidential candidate Barack Obama’s is to do the same to its tech-policy issues.

29. Sounds More Like the “Zune of Reading” to Me
    If Jeff Bezos truly hopes to create “the iPod of reading,” observers say he’s going to have to do a hell of a lot better than Amazon’s new Kindle e-book reader.

30. Fiascobook
    What Facebook CEO Mark Zuckerberg lacks in foresight, he certainly makes up for in disingenuous hair-shirt remorse.

Web 2.0 will be known as the name of a bubble. And 3.0 would only be a marketing disaster.”
Ross Mayfield’s Weblog, Nov. 12, 2006

Web 2.0 acolytes who shelled out 1,100 euros for admission to Web 2.0 Expo Berlin, which kicks off today, will no doubt be dismayed to learn that the term “Web 2.0″ is no longer an enchanted aegis under which to quest for venture capital. Seems the VC community has finally had it with Web 2.0, its hobbies masquerading as businesses and start-up brands with a reclusive letter “e.”

To wit, Kleiner Perkins Caufield & Byers, one of Silicon Valley’s most prestigious venture capital firms, is reportedly no longer investing in Web 2.0 start-ups. “We have absolutely no interest in funding Web 2.0 companies,” KPCB partner Randy Komisar recently told Silicon Valley Watcher’s Tom Foremski, adding that he’d recently told John Battelle, conference chair of Web 2.0 Summit, that the term is viewed with disdain in the VC community.

As the Globe and Mail’s Mathew Ingram notes, Komisar’s remark is for Web 2.0 devotees “a little like King Arthur telling you he’s really not that hot on the whole Grail thing any more, and you can stop looking now.”

It’s also more than a little ironic. Because, according to a report from Dow Jones VentureOne and Ernst & Young, emerging Web 2.0 companies snared almost $1 billion in venture capital worldwide in the first six months of 2007. That said, very little of it was from KPCB, which seems to have sat most of Web 2.0 out. “I’m personally not doing much in Web 2.0 at the moment,” Komisar told VentureBeat in January. “I’m looking for more fundamental innovations. I’m less interested in the content and media fallout. There are no strong barriers to entry in Web 2.0. If by Web 2.0, you mean companies that build an audience to be monetized by Google, I am not actively pursuing them; though I should never say never. I’m not sure how long YouTube would have remained an independent business had they not been bought by Google. Google has an efficient search engine to monetize large audiences. If you’re creating Web 2.0 products and media, its tough to build anything of sufficient scale to remain independent–you are more likely to end up being a feature on Google, Microsoft or Yahoo.”

Now that Ted Leonsis, vice chairman of AOL and president of its “fast-growing” Audience business, has retired from his active management role, he’s got plenty of time to shill for his “Web 2.0 payment platform,” Revolution Money. It’s “PayPal meets MasterCard without the high fees,” says Leonsis, who claims Revolution will completely overhaul the online payments industry with its PIN-protected anonymous credit card and payments platform for social and instant-messaging networks.

But I suspect it’s going to take quite a bit more than that to unseat institutions like Visa and MasterCard, even with merchant fees of just 0.5%.

I’ll be in San Francisco today through Friday covering the Web 2.0 Summit exclusively via Facebook status updates.

… Kidding. Check back here later today for our coverage.

People keep asking what Web 3.0 is. I think maybe when you’ve got an overlay of scalable vector graphics–everything rippling and folding and looking misty–on Web 2.0 and access to a semantic Web integrated across a huge space of data, you’ll have access to an unbelievable data resource.”

–Tim Berners-Lee, May 2006

Web 2.0 is well documented and talked about. The power of the Net reached a critical mass, with capabilities that can be done on a network level. We are also seeing richer devices over the last four years and richer ways of interacting with the network, not only in hardware like game consoles and mobile devices, but also in the software layer. You don’t have to be a computer scientist to create a program. We are seeing that manifest in Web 2.0 and 3.0 will be a great extension of that, a true communal medium … the distinction between professional, semiprofessional and consumers will get blurred, creating a network effect of business and applications.”

–Jerry Yang, co-founder and CEO of Yahoo, November 2006

“Web 1.0 was dial-up, 50K average bandwidth, Web 2.0 is an average one megabit of bandwidth and Web 3.0 will be 10 megabits of bandwidth all the time, which will be the full video Web, and that will feel like Web 3.0.”

–Reed Hastings, founder and CEO of Netflix, November 2006

Had to happen sooner or later, right? The lexicographers who gave us the term Web 2.0 have finally gotten around to issuing an “official” definition of Web 3.0 and, having undoubtedly scurried to trademark the term, are probably already plotting the pricey industry conference that will accompany it.

So what is Web 3.0, “officially”?

Web 3.0 is defined as the creation of high-quality content and services produced by gifted individuals using Web 2.0 technology as an enabling platform.”
–Jason Calacanis

In other words it’s Web 2.0 2.0, Web 2.0 with another 1.0’s worth of marketing BS. Or, as Josh Kopelman, managing director of First Round Capital, aptly puts it, “any Internet-based company that has launched after 2004.“

Digital Daily’s John Paczkowski is live-blogging TechCrunch40, a two-day conference in San Francisco highlighting what its organizers consider “40 of the hottest new start-ups” from around the globe. Additionally, another hundred or so companies are demoing their products, some of which he’ll feature here.

OK. After a registration foul-up (don’t you know who I am?!!!!!!!), and innumerable technical difficulties (I am, indeed, writing this on my iPhone, and I’m beginning to realize that Steve Jobs may not have been exaggerating when he said that after a few weeks of typing on this virtual keyboard, “you’ll be flying.”) I am finally up and running.

(Eric Savitz of Tech Trader Daily got in a good post on the five search-and-discovery demos that started the conference in earnest this morning, along with comments from the panel of judges.)

Given these early difficulties, I have no detailed posts on the first round of presentations, just some general observations:

• Big focus on video from first presenter.
• All presenters seem to suffer from the same Web 2.0 Tourette’s Syndrome, uncontrollably spouting Web 2.0 jargon: Ajax, long tail, etc.
• Note: if a drinking game existed that required participants to take a drink every time a presenter used a boom 2.0 cliche, I’d have alcohol poisoning by now.
• Conference co-sponsor Jason Calacanis just told everyone with iPhones to turn their Wi-Fi feature off because the devices are “crashing our Wi-Fi network.” How frigging Web 2.0 is that?
• Judges panel: Seated next to Marc Andreessen, Engadget’s Ryan Block
  looks like a Mini-me version of the Netscape founder.
• Yahoo presents a new service, not yet available. Long-winded intro. Conference organizers should have forced “big presenters” to adhere to the same eight-minute pitch rule.
• It’s called Yahoo for Teachers. Online lesson plans. Social networking for social good. (Wonder how long it took Yahoo PR to come up with that one?) Bit of a yawner, this one.

Two years ago we decided to move our servers to 365 Main because we believed its San Francisco facility could accommodate our expected growth better than any other, and for a comparable price. And that’s exactly what has happened. 365 Main has fulfilled its brand promise of [the] ‘world’s finest data centers’ by delivering the reliability and uptime that attracted us in the first place.”

–Dale Emel, director of technology services at RedEnvelope

Well, 365 Main couldn’t have picked a worse day to celebrate its uptime record, now could it. Yesterday morning the data center operator broadcast a press release announcing that it had provided online retailer RedEnvelope with two years of 100% uptime. “To ensure uptime for key tenants such as RedEnvelope, 365 Main provides modern power and cooling infrastructure,” 365 said in the release. “The company’s San Francisco facility includes two complete backup systems for electrical power to protect against a power loss. In the unlikely event of a cut to a primary power feed, the state-of-the-art electrical system instantly switches to live backup generators, avoiding costly downtime for tenants and keeping the data center continuously running.”

Quite a boast. And one that was made absurdly ironic a few hours later when a power outage in downtown San Francisco interrupted 365’s theoretically uninterruptible power supplies and disabled RedEnvelope and a host of other Web sites.

The outage, which began at about 2 p.m. PDT, knocked a who’s-who of Web 2.0 outfits offline for a good hour or so. How is that a company that touts itself as the operator of “the world’s finest data centers” failed its clients so miserably? Said Miles Kelly, 365 Main’s vice president of marketing, “I don’t know.”

Truly an unfortunate turn of events for 365 and one sure to give its PR team nightmares for years to come.

Looks like vowels won’t be the only accoutrements to be tossed aside in the rise of Web 2.0. The venerable page view is to be abandoned as well. This morning measurement firm Nielsen/NetRatings said it will no longer use page views as its primary metric for comparing sites, but will instead rank them by total user time spent onsite.

Why the sudden change? The increasing popularity of AJAX (Asynchronous JavaScript and XML), which allows a Web site to refresh content without reloading an entire page, demanded it. “It is not that page views are irrelevant now, but they are a less accurate gauge of total site traffic and engagement,” said Scott Ross, director of product marketing at Nielsen/NetRatings. “Total minutes is the most accurate gauge to compare between two sites. If [Web] 1.0 is full-page refreshes for content, Web 2.0 is, ‘How do I minimize page views and deliver content more seamlessly?’ ”

Yeah, that or how do I inflate my page views and capitalize on the resulting publicity.

Anyway … one possible result of Nielsen’s adoption of time onsite as its primary metric of audience measurement will be a decline in rank for Google. After all, no one really spends much time on the site. We visit, conduct our search, and then we’re off. That said, the company could probably care less about such things. If Google has taught us anything, it’s that the most meaningful metric for success on the Web is not page views, but profitability.