Social media – a reminiscence

Since June 2007 I’ve had an incredibly interesting job with IBM exploring the possibilities of social media and some of the other internet and related technologies that have emerged recently. I was first asked by Graham Spittle, who was then the Director of IBM’s Hursley Software Development Lab in the UK, to go and work with our customers to get a better understanding of what “Web 2.0” meant to them, and what it meant for how they would use our products.

One of the key things I learnt was that it’s pretty impossible to get hold of what Web 2.0 “is”. I quickly started to think of it as “everything that’s been done with internet technologies since the dot.com crash”. That tallies with O’Reilly Media’s 2003 coinage of the term as the name for a conference intended to revive business interest in the internet (see Tim O’Reilly interviewed by CNNMoney.com in 2007).

In 2007, Web 2.0 was already old hat in internet circles – and is much more so now. But for many “traditional” companies it was and remains something new, intangible, exciting, scary … but also, for its own sake, often irrelevant.

Do I really mean irrelevant? Not quite … I’ll explain with my personal conclusions and predictions for “Web 2.0” …

1. “Web 2.0” is an irrelevance to businesses …

Web 2.0 is best viewed as a banner term for the collection of internet-enabled technology, commercial and social phenomena that appeared between 2003 and the present time of writing. I don’t think that timeframe will expand much further for reasons that will become clear.

That definition covers such an incredibly broad area that in total it never has and never will be of interest to anyone other than technologists of one variety or another. “Web 2.0” is not relevant to any individual business (with the possible exception of Web 2.0 consultancies) – but elements within it are highly relevant in wildly different ways to (arguably) all individuals, businesses, communities and other organisations.

For those reasons, most organisations I talk to are not interested in “Web 2.0”, and many are frankly bored by the number of people who want to talk to them about it. However, they are very engaged by the way specific developments in internet technology are affecting their businesses and their industries.

2. … but does describe a period in history during which individuals, businesses, governments and social organisations harnessed an incredible variety of new technologies …

Depending on the client I’m working with and the area of their business we’re discussing, I’ll talk specifically with them about communicating intimately with their clients through social media, using Enterprise Mashup technology to create rapid, content-driven applications,  using community effects to create and commercialise new interactions in their ecosystem, using “Web-Oriented Architecture” to deliver scalable online content and services in an easy-to-consume form … etcetera. Our clients are exploring all of those possibilities – sometimes under the banner of Web 2.0, sometimes not.

For example, mobile telephone service providers maintain enormously expensive communications infrastructures that enable us to use our increasingly capable handsets to access a multitude of third-party applications and content in ways that do not necessarily deliver significant extra revenue to them. Conversely, they have a set of capabilities not easily replicable in an integrated manner elsewhere in the online world: they identify us through our SIM card; they bill us through our accounts with them, and the financial information we trust them with; they locate us through the cell network; and they can identify our friends, family and contacts through the entries in our address books. As a result, these organisations are investing huge energy exploring the potential of multi-platform social applications and gadgets that use these capabilities to create revenue-generating traffic through network subscriptions, data bandwidth usage, application licenses or transaction fees.

3. … and represents an ongoing fundamental change in the social and economic organisation of the world …

I really believe that the world is changing through this process. Web 2.0 didn’t start this – the Grameen bank, for example, have been harnessing (and creating) these ideas to enable microfinance to benefit the developing world since 1997. But the wave of activity and technology development driven by the evolution of the internet and represented by Web 2.0 has in many cases demolished the cost and difficulty involved in connecting people around the world with complimentary interests, and enabling them to interact with each other. Some examples:

• Microfinance (e.g. Grameen, Kiva) – greatly increasing the ability of millions of people with not much to give to chose exactly how their donations are used to directly benefit those in need.
• Online marketplaces (e.g. eBay, Amazon) – greatly increasingly the fluidity with which resources such as second hand goods are exchanged for cash, bartered, or given freely.
• Collaborative business models (e.g. Threadless, Zopa, Zuda Comics) – directly connecting anyone with the ability to create clothing, music, video entertainment, comic art, handmade goods and many other products, with the people interested in consuming them, wherever they are, and no matter how few or many they be.

I’m passionate about this aspect of Web 2.0. I blogged recently about the combined impact of the current economic crisis and the environmental challenges we face, inspired by an excellent special issue of the New Scientist magazine. The implication is that we are in great need of these new models of economic interaction and resource optimisation to support a growing population with rising expectations on a finite planet.

4 … enabling individuals to interact without the aid of traditional organisations …

Consider peer-to-peer lending. Zopa in the UK have shown tremendous growth in recent months (see my previous blogpost). Zopa provide introduction, vetting and bad-debt recovery services to individuals wishing to enter into agreements to borrow from or lend money to each other. Internet technologies make the introduction part incredibly cheap.

That simple model replaces part of business of traditional Retail Banks or Building Societies, wherebv product design, sales & marketing, branches, call centres and a huge number of other operations are used to persuade and enable savers to deposit funds and lenders to request them on a sufficient scale that a regular operating margin and sustainable business model can be created.

Is it a huge business? Not yet. But is it interesting and growing fast? Definitely. Read this great post from the Financial Services Club’s blog for a balanced picture.

Online marketplaces enable a similar model: small traders using them can leverage a global infrastructure to reach markets they couldn’t dream of a few years ago; and by using the brand and reach of the parent marketplace, they don’t need to be experts in online marketing to do so.

5 … creating challenges and opportunities “traditional” organisations to reinvent themselves – or just evolve.

Newspapers. Record companies. Book sellers. Filmmakers. Software companies. Electronics retailers. Banks. Mobile telephone service providers. It’s easy to find news and opinion pieces every day citing the struggle these organisations are facing as the internet evolves – and the opportunities they are presented with.

And for sure, some of this is serious. In Tribes, Seth Godin wrote a great description of the way cheap music recording, production and distribution technology has undermined every aspect of the traditional business model of a music company. As a result, many traditional companies are struggling to get to grips with the new world, whilst newcomers such as iTunes flourish.

In other areas, the picture is less clear. Traditional media organisations such as broadcasters and newspaper publishers have seen advertising revenues plummet in their traditional channels as advertising spend shifts online – these revenues are the basis of their business models.  But they are – faster or slower, for better or worse – evolving their business models to embrace and commercialise the online world. The Daily Telegraph, for example, made great use of Twitter in covering the G20 summit.

Am I predicting imminent collapse for vast numbers of businesses? Not driven by the internet, no (current economic conditions are a different matter). But do I expect that in 5 and 10 years time we’ll see not just a different set of companies dominating the industries we recognise today, but in some cases a completely different set of industries themselves? Absolutely. Are Google today a dominant technology company, or a dominant media company? How do you breakdown a world in which the same digital content is accessible on your TV, PC and mobile and embedded in your MySpace page? We’re about to find out.

Moving On

As I’m moving on from my current role, I have a sense that the world is (finally) moving on from Web 2.0. Unlike Service-Oriented Architecture, the last sweeping trend to affect the technology world, I don’t think Web 2.0 will stick around – unlike SOA, it doesn’t have a cohesive, innate structure. And I don’t think it will be replaced by “Web 3.0” either – the internet was only created once, it will only ever cause one fundamental economic crash caused by the hype following that creation, and it will only ever emerge from that crash to be called “Web 2.0” once.

From here, a whole plethora of internet-enabled technologies, ideas, applications and models of commercial or social interaction will evolve along their own separate paths. The generation of people who grew up with a globally connected internet as a completely normal part of the everyday world are already inventing new forms of communication at a faster rate that ever seen before on this planet, and all of them, and those who seek to exploit them, will suffer their own individual trials and tribulations.

What I’ve learnt is that what’s interesting to me is not so much the technology, but the individual and organisational behaviours that affect its adoption and usage. It’s those thoughts that I’ll take into my new role, which whilst it won’t be focussed around Web 2.0 or any of its elements, will doubtless involve them – and many other new and exciting developments – in some way. More about that later.