What is Web 2.0? You’ve heard the term… now find out what it means.

Web 2.0 is a phrase coined by O’Reilly Media in 2004 while trying to come up with a name for a conference while also making the point that the web mattered again. They knew new things were coming, and the “2.0” referred to whatever those might be. Simply put, Web 2.0 refers to a perceived second generation of web-based services such as social networking sites, wikis, RSS feeds, blogs, podcasts, and communication tools that emphasize online collaboration and sharing among users. Another analogy would be that Web 1.0 was commerce and Web 2.0 is people. Netscape was the standard bearer for Web 1.0, and Google is most certainly the standard bearer for Web 2.0, if only because their respective IPOs were defining events for each era.

The original description of the Web 2.0 conference turned out to be partially right: web-based applications are a big component of Web 2.0. One is certainly Ajax, which basically means “Javascript now works.” And that in turn means that web-based applications can now be made to work much more like desktop software. The Ajax boom didn’t start till early 2005, when Google Maps appeared and the term “Ajax” was coined.

The second big element of Web 2.0 is democracy. We now have several examples to prove that amatuers can surpass professionals, when they have the right kind of system to channel their efforts. The most dramatic example of Web 2.0 democracy is not in the selection of ideas, but their production. The largest portion of articles or stories you’ll read on a website is as good as or better than the stuff we read in newspapers and magazines. The evidence of this is the top reference links are generally links to individual people’s sites rather than to magazine articles or news stories. This is a shift of power from Web publishers to Web users. Basically stated, we’re moving closer to the reality where the online network is the platform and all involved have equal access.

Web 2.0 is all about customer involvement. Don’t resist this movement, but learn to embrace it by letting your customers mold and expand your business. Whether you’re a Fortune 500 company or an Internet startup, using Web 2.0 techniques to surpass your competitors in establishing market leadership will be essential for success while reaching out to the 1.1 billion potential customers online. The key to success in this next stage of the web’s evolution is leveraging collective intelligence. Those who do not adhere to the movement will surely fall behind.

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