It slices, dices, mixes, mashes, julienne fries, stirs and when you’re done lights venture capital cash on fire while creating social earthquakes. It is Web 2.0 the term used to describe social media. The new best thing in tech, half the people using twitter are Web 2.0 experts who will help you brand, outlast, extend and get noticed in the Web 2.0 world. Web 2.0 has everything but a revenue model.
That’s ok. We’ve been here before. Those of us who remember the .bomb economy can hear the tinkling words of “who needs to make a profit you just have to be well funded”. Right up until luddite venture capitalists refuse to write the next check. Whether you’re talking about mashups, wikis, web forums, micro-blogging, social media aggregation, or some other social media super star service they all have one thing in common. They don’t make money.
We’ve already seen a roll up in the blogging world. As newspapers have hung “out of business” signs on their corporate windows, the blogging world long thought to be their replacement has been shifting. Blogging entities have been rolling up and aggregating into fewer sites but more rich content. Thereby driving hits and creating better profit potential. Except the advertisers aren’t miraculously appearing.
Recent movies like Terminator: Salvation has the marketing companies going directly to the consumer bypassing normal advertising strategies and using social media to create a buzz. Advertisers can use social media too. That isn’t to say all is lost in chasing advertising dollars. What it does say is that all of the things that make social media great also play to the revenue projection/creation models of advertisers.
The mavens and true believers of Web 2.0 and social media will be aflutter their hearts ripped out by my cruel tenet that “The interwebz isn’t real life, you still gotta eat, that takes something called money”. Like the .bomb generation a decade ago they will say “we just create the community the revenue model will follow”. Um, yeah right. For some small few that will be true. eBay, Amazon, and Google flourished in Web 1.0 and somewhere the Web 2.0 generation will have their bright spot. Everybody else will be taking a gamble.
Still like the .bomb the problem isn’t the technology or the creativity it is the basic sound understanding that Web 2.0 social media has to make money. Recently Bill Gates said that technology and innovation would bring the country out of recession. He is half right. Innovation will serve the country more than technology. Technology without a purpose serves nobody. Technology without a revenue model may be great but it will be a drag on the economy. The question to the consumer is would you pay for the service of Facebook or Twitter?
Web 2.0 is great. Show me the money.