I've always been a big believer in learning from history as we look to the future. So let's re-visit this interview from five years ago and see how prescient the father of Web 2.0 was.

In 2004 the leading Web 2.0 companies were Google, Yahoo! and Amazon. But what of the dominant software company of the previous generation, Microsoft? I asked Tim O'Reilly back in November 2004 whether Microsoft's core strategy of software lock-in would survive in web 2.0?

O'Reilly argued that Microsoft would have to change: "I think that the business of Microsoft, the company of Microsoft, is going to continue to succeed. But I think the business model of Microsoft is going to have to change."

This has turned out to be the case. Over the past 5 years, Microsoft has slowly rolled out a "software plus services" strategy under the catch-all phrase 'Live.' While the Windows OS and desktop software such as Office continue to be Microsoft's mainstay products, some of the functionality gradually moved into the cloud - e.g. syncing over devices. Vista, the current generation of Windows, began that transition. In 2009, Microsoft is even taking steps to put Office online.

With the benefit of hindsight, I think O'Reilly nailed it in 2004 with this statement: "Microsoft will continue to dominate on the PC, but the PC is going to be a smaller and smaller part of the entire business."

The Mobile Web, for one, has taken attention away from Microsoft. Which is where Apple comes in...

Apple and Web 2.0

At the inaugural 2004 Web 2.0 Conference, Apple was a no-show. In talking about Apple's position in the Web industry back then, O'Reilly said that "Apple is in a position they've been in a lot of times before. They're like Moses showing the way to the promised land, but they don't actually go there."

Although Apple never did open up, as O'Reilly foresaw, nevertheless they went on to create the most successful new gadget of the past decade: the iPhone. Apple also created a thriving iPhone app ecosystem.

So in the case of the Mobile Web, Moses (a.k.a. Steve Jobs) actually did lead us to the promised land!

Facebook and Data Lock-in

In 2004 I noted that "a lot of what Web 2.0 is about is users producing content and not just consuming it." I pointed to O'Reilly's own example at the time: Amazon compared to the Barnes & Noble website. However, I said that "the other side of that coin [...] is the 'data lock-in' of users, where users may not necessarily have control over their content." I asked O'Reilly if that was something for users to be concerned about?

O'Reilly replied, in November 2004, that "there are companies that are trying to use data lock-in as a competitive tool - and there will eventually be a recognition that this is a problem."

This has indeed happened - and data lock-in is nowhere more of a problem than on the world's most popular social network circa 2009, Facebook. Over the past few years we at ReadWriteWeb have written many articles about Facebook's 'walled garden' approach to user data. Users can't take their personal data elsewhere. What's more, there have been bungled attempts to use that data for commercial means.

Remember that Facebook had just launched in February 2004 and was confined to some selected American Universities (Harvard, Stanford, Columbia and Yale). It had yet to reach the 1 million users mark. While O'Reilly couldn't have known that Facebook would turn into the juggernaut it now is, he did accurately predict that data lock-in would become a major issue:

"I believe that data lock-in of various kinds is going to be one of the key tools of business advantage in the internet era. I think that as companies realize this, they will figure out how to be evil - so to speak (to use Google's terminology) - and I predict that we will in fact have some major battles in that area."

Conclusion

It is remarkable how much can change in the Web industry in five years. Back in 2004, Facebook was a baby and Twitter wasn't even a glint in the milkman's eye. Among the big companies of that time, Apple hadn't yet given birth to the revolutionary iPhone and Microsoft was entering its mid-life crisis.

On reflection, Tim O'Reilly did extremely well in his 2004 predictions - considering how fast the Internet evolves. And I'm still grateful to him for giving an interview to an unknown New Zealand blogger. How times change...

Image credits: Niall Kennedy; Shht!; Alex Eckford

We go gaga over great mashups, we drool over high-powered hardware, and we lust for private beta invitations to Google's latest whatever-the-hell-it-is. But none of these would be possible without machines to blast steam through finely ground coffee beans, and baristas with the skill to pull a perfect espresso shot.

So, the next time you start your day with a smashing cup of coffee, look your barista in the eye and say, "Thank you. Thank you for fueling the social media revolution. And - yes, I know people are behind me, but this is important - thank you for the example you set with your attention to detail. Thank you for - no, there's no need to call security. I'm just saying a simple thank-you for everything you're doing for Web 2.0 and - fine, FINE, I'll go."

So where does coffee fit into your dev process? Are you in more of a spiritually grounded green-tea kind of office? Or have you managed to kick the caffeine habit altogether?

More Noise to Signal.

I discerned three important nuggets from Roberts:

• Comcast will continue to invest in higher-bandwidth connections into homes.
• Comcast will invest in content more aggressively.
• Comcast will officially launch Hulu-competing Fancast.com by the year's end.

The first two points make a ton a sense. The third point is... well, miscalculated.

I am convinced Brian Roberts understands the challenges ahead. This is why Comcast and Time Warner (which also clearly "gets" it) have been aggressively pursuing a "TV Everywhere" model, which promises to give their subscribers exactly what they want: anytime, anywhere access to any TV content. They have to do this to keep their customer bases.

But in a TV Everywhere world, the role of the multi-system operator is diminished. Your cable or satellite TV provider will no longer be your only (legal) means of watching the current episode of HBO's Entourage. In a TV Everywhere world, Entourage will be available on literally thousands of websites and mobile apps, as long as you can authenticate yourself as a paying cable or satellite subscriber with the HBO package.

In this world, the value of Comcast as a content distributor is eroded. Comcast risks becoming a "dumb pipe," providing little more than bandwidth. To avoid that fate, Comcast recognizes that it needs to move upstream and own or control the content itself. This is why it will buy NBC in the next few months.

Moving upstream and investing in content is a smart move for Comcast.

Moving downstream and competing with Hulu via Fancast.com is a bad move. Here's why:

• Hulu already has a huge lead, having aggressively grown its audience for more than a year now.
• Hulu would be the ideal launching pad for TV Everywhere, because of its mega-loyal and passionate audience.
• Comcast is about to own a third of Hulu. Ad revenue from Hulu will ultimately end up back in Comcast's coffers.
• In a TV Everywhere world, thousands of websites will likely present the same TV content as Fancast.com. It will be a terribly crowded space, with a ton of noise. The sites that perform best will be the ones that create the best user experience for viewing TV content.
• Comcast has a poor track record with UI and user experience design. Need I compare more than Comcast DVR's UI to TiVo's UI?
• Strong consumer brands drive website traffic. Comcast has a horrendous consumer brand. Comcast users generally do not like being Comcast users.
• Comcast's interest is in the broadest distribution of TV content, not exclusive distribution. Locking up certain content for Fancast.com alone would be a mistake. Consumers would see it as a violation of their rights, akin to the Net Neutrality debate.

Comcast can survive (and perhaps prosper) through the death of cable-based TV, if it makes smart strategic decisions. That means focusing on where it provides the most value in the TV supply chain: Internet connectivity and content investment. Creating a content website that competes with its distributors is not a smart move.

Comcast should pull the plug on Fancast.com or simply use it as a TV Everywhere authentication testing site.

Guest author: Mike Berkley served as CEO of SplashCast Media from 2006 to 2009, pioneering the concept of social TV in partnership with Hulu. Berkley is currently involved in the TV Everywhere initiative, consults on product strategy for online media companies, and maintains the TV News Stream blog covering all things related to online premium video.

Once again mobile is a big trend this year, with Apple's market share expected to "Surprise on Upside Near-Term."

Overall the key message was that financial markets have rebounded now; and that technology is "relatively impressive."

O'Reilly remarked that we're seeing "what may be the next wave of internet business models." Speaking about the evolution of both the conference and the web 2.0 trend, he noted that the "revolution we're seeing today is as great as the one we saw five years ago."

Last month we ran a series of posts outlining the 5 biggest Internet trends of this year: Structured Data, Real-Time Web, Personalization, Mobile Web / Augmented Reality, Internet of Things. Effectively this was ReadWriteWeb's State of the Web 2009.

We compiled the main points into a single presentation, available on Slideshare and embedded below. We think these trends show that we are indeed at an inflexion point of the Web, as Tim O'Reilly noted at the Web 2.0 Summit today. We'll be exploring more of these and other cutting edge Web trends over the coming months on ReadWriteWeb.

1. Structured Data
2. The Real-Time Web
3. Personalization
4. Mobile Web & Augmented Reality
5. Internet of Things

For those who are widely loved, you'll see this as a blessing. For those who are widely loathed, you'll see the full wrath of the internet in colorful cross-platform commentary. Echo further transcends existing commenting systems with the incorporation of HTML, photo and video. This appears to be a truly amazing tool for mash up contests, political debates and global events.

Loux said, "When Robert Scoble saw this his response was, 'blogging is back'." Scoble's own Building 43 project aggregates comments into the Community 43 page from various social media sources using hashtags. However, where Scoble's community dialogue gets buried as new media comes in, Echo produces a live feed that stays visible with the source material. Chris Saad, VP of Product Strategy and Community, said,"We look for links back to the source page inside tweets/FriendFeed etc and bring in the related conversation - in real time."

This evolving stream of truth (good and bad) is about to stare us in the face every time we visit our pages. It will be interesting to see how this will affect blogging as we know it. Do you think bloggers will elevate their game to gain accolades or simply become gratuitously extreme in order to stir conversation? To reserve an Echo subscription, visit the JS-Kit site.

Notes

Why 2.5? Because we are in transition. The old is still with us, and the new is emerging but has not yet arrived. This was also true when "Web 2.0" was coined: only later did orthodoxy emerge.

2.5 is named "Get real" because we all have to do that. The punch bowl was taken away.

3.0 is named "Main Street" because the web is maturing... for everybody.

Social Media: Closed social-network sites cannot survive in their current form, and yet they are so dominant today. So the transition to open and pervasive will be a big and messy fight... which will be great fun for journalists to cover!

Advertising: Advertisers will adopt a barbell approach: CPM for branding, and CPA for direct-revenue generation (as soon as publishers figure out how to make money selling CPA). CPC will still be dominated by Google but will become less dominant as CPA gains traction. Google will play in CPA and CPM but won't dominate as it does in CPC. Publishers will sideline CPA because nobody will be able to compete with the CPC price set by Google. Ventures that bridge the gap between publishers wanting to sell CPM and advertisers wanting to buy CPA will do well.

Revenue: Primary revenue will come from subscriptions and transactions, with advertising as one driver of those revenue lines. Today, we are in transition and in recession, so any revenue is good.

Content: UGC reduced the cost of content but created too much junk. Curation (adding human editors to automated UGC content) will be aided by semantic technologies that aim to do what humans currently do well.

Start-Up Hero: Today, it's "Nobody" because we are all in a hangover funk. In the near future, entrepreneurs really will hold the best cards; financiers will be secondary.

Funding: The "Big VC" model is broken but will carry on for ages ("Zombie VC"). Angels and small VCs are in the cat-and-bird seat today. But they need a revived public market or something other, which we'll call "private + transparent."

Prime Market: This is a century-long shift, like the one from Europe to America. Asia is not ready yet, America is in turmoil, and Europe is conservative, so this is another transitional phase.

One brilliant commenter will win our swag bag from our recent trip to the Web 2.0 Expo in San Francisco - ironically an expo that seemed to be more about Enterprise 2.0 than it was about the consumer-oriented startups of days past. In fact, the most jam-packed sessions at Web 2.0 Expo were about harnessing the power of Web 2.0 for enterprise, for marketing, for advertising, etc. They weren't about you and me and our cool new web 2.0 applications built in the proverbial garage.

So is Web 2.0 declining? If so, why? It's the economy, right? That's the easy answer, of course. But is it possible that maybe Web 2.0 was already reaching its heyday when the big crash occurred? Was its number about to be up, anyway?

Or is the opposite true: now is Web 2.0's heyday. Now, everyone is on Facebook, everyone shares videos on YouTube, everyone looks up information on Wikipedia. Web 2.0 is everywhere - which, really, is the opposite of being dead.

What's Next?

But if you think Web 2.0 is over, then what comes next? Where's Web 3.0? The Semantic Web? That hasn't really come to pass yet. Or will Web 3.0 be the mobile web? That's my opinion, to be sure. The only real innovation that excites me these days is happening on mobile, not on the traditional web.

But this isn't about my opinion today or those of any of the ReadWriteWeb authors - today it's about yours. Share your thoughts and we'll pick our favorite commenter to win the goodie bag from the Expo filled with t-shirts, stickers, pens, CDs, notebooks, and other goodies from the conference. Just be sure you use a real email address so we can get in touch.

The Goodie Bag:

Two themes stood out: sensors will surpass humans in front of their keyboards as the primary data source on the web and Moore's Law will need to be applied to humanity's greatest problems.

1. Google Voice Search on the iPhone

Google launched an iPhone app in November that lets you search by voice. It uses the iPhone's built in sensors in ways that other voice searches can't. It's not just voice recognition, it's also gesture recognition - the application starts listening when you put the phone to your face. O'Reilly asked, rhetorically, if the service was "a tipping point for the web" when it launched and it's still on his short list of key technologies today.

2. Gracenote's CDDB

The CDDB, or Compact Disk Database. This technology isn't new but it represents the kind of thing that O'Reilly expects to become much more common in the near term future. Their time has come, these tools for pulling patterns out of large and seemingly random sets of data. As he explained on stage tonight, the CDDB service identifies CDs by looking at the unique fingerprint created by the duration of songs in any collection on a commercial music CD. It doesn't identify individual songs but rather analyzes the aggregate data on albums in order to identify the collection. That's pretty cool.

See also the non-profit MusicBrainz.

3. AMEE Smart Grid

The AMEE smart electrical grid company tracks energy use in customers' homes and offers all kinds of valuable information based on what they see. TechCrunch UK called it "like an OpenID for your carbon footprint" in its coverage of O'Reilly's investment in the company.

O'Reilly said tonight that much like CDs in the CDDB, AMEE has discovered that the energy fluctuations of home appliances are so unique that they can tell what make and model of refrigerator you have by the way it acts when the motor turns on. Then it can suggest a more energy efficient appliance.

4. The NASA/CISCO Planetary Skin

NASA and CISCO unveiled plans last month to build what they call a Planetary Skin of sensors to monitor global climate change. The ability to process all the information that will come in through such a network of sensors is a good example of what O'Reilly called "applying Moore's Law to the world's biggest problems."

5. IBM Smarter Planet

O'Reilly highlighted the IBM Smarter Planet project in his talk about the future tonight. Smarter Planet is a broad body of initiatives by IBM to integrate efficient technology into a wide variety of systems around the world. Much of it is public infrastructure work.

Last week IBM announced that it would make bringing its channel partners into the Smarter Planet project a major priority and that it will be sharing the huge amounts of data it collects through the initiatives with channel partners as well.

Those are Tim O'Reilly's favorite examples of technologies that point beyond the last five years of the Web 2.0 era. Have you got other examples in the same vein? Perhaps you've got a different big picture vision of the next stage of the web. This fifth anniversary of the first Web 2.0 Conference is a great time to reflect on where we are as a web connected world and where we're going.

We're moving beyond the days of a simple search box in which you type a query and get a list of results. Today, companies are trying to build a smarter web - one that understands what things are, how they relate, and perhaps most importantly, what things you're going to like. But has Web 3.0 arrived in its full semantic glory? No, not yet. But it's clear we are getting closer than ever before.

To begin, there's the seemingly minor announcement from Xmarks, the company formerly known as Foxmarks, but now rebranded thanks to their multi-browser support. Xmarks has introduced additional features to their bookmark synchronization product which include things like site suggestions and smarter search. By leveraging their large stash of data (600 million bookmarks), Xmarks is now able to recommend sites right within your search results. This is done by placing an Xmarks icon next to those results which are most popular, meaning most bookmarked, on their service. Also, when you visit a web site and click the Xmarks icon in your address bar, Xmarks will return a list of sites similar to the one you're currently browsing.

The data used to deliver these recommendations and suggestions are anonymized - a good thing considering that our browser bookmarks are often the ones we have specifically chosen not to share with others. For bookmarks to become recommended in this fashion, they must be fairly popular on the service - a level that's determined by the number of times saved as a percentage within a particular category.

In a way, what Xmarks is doing is very similar to what StumbleUpon's browser extension does too. Like Stumble, Xmarks annotates our search results highlighting those that may be of value to us. Yet Xmarks takes it a step further by discovering related sites, too.

The Smarter Tracking Tool (Evri)

Another company revealing new innovations here at DEMO 09 is Evri, a semantic search engine which understands what's called "natural language." Evri knows the different parts of a sentence (subject, verb, object) and it knows how those parts are connected to each other.

Although still too raw to be your main search engine, Evri has a new "Collections" feature which lets you follow topics (aka search queries) that are of interest to you. After returning a list of search results which include Wikipedia entries, news articles, videos, and images, you can click the star labeled "Follow this" to continue to track that topic. What's missing from this feature, though, is an alerting system which will inform you of updates via email or RSS. However, the company says that's coming later on.

Evri is also branching out from being a web destination alone by introducing Evri widgets which can now be seen in action on the Washington Post's web site. These widgets parse the content on the page to deliver smart recommendations of similar articles both on the site itself as well as elsewhere on the web. 

Another new feature launching now is Evri's browser toolbar. By clicking on a button next to the Evri search box in the toolbar, the people, places, and things on a web page are highlighted. Click on these items and pop-ups appear with more information about the keyword, what's related to the topic plus news, images, and videos.

This additional layer of information on top of standard text makes browsing the web and reading articles a deeper and richer experience. No longer do you need to perform web searches in a separate window to understand definitions, context, and meaning. Instead, Evri's toolbar adds an intelligence to the web that was never there before. It's clear that the company is still working towards making that additional layer more accurate and more relevant, though, but conceptually the idea is solid.

The RSS Reader That Learns (Ensembli)

Ensembli, an RSS reader of sorts, takes a different approach to tracking topics than Evri does with its "Collections" feature. Where Evri's UI can sometimes feel a bit cluttered with its multimedia results, Ensembli's interface is simple - you just type in a topic and it will continue searching for new articles related to what you entered. But this reader doesn't simply pull information for you - it learns what you like. Every time you read, ignore, or discard a story, Ensembli gets to know your tastes a  little bit better.

While this feed reader is far too simplified for RSS junkies like us, it's easy to see how Ensembli could be a good introductory tool for RSS beginners. Still, the sources it returns sometimes seem lacking and it's hard to say if this will ever be any more useful that a simple Google Alert, for example. Nevertheless, it's not really the feed reading itself which makes Ensembli intriguing, it's the learning element. Whatever algorithm is at work behind the scenes figuring out your likes and dislikes is what's the most important aspect of this new technology.

Getting Smarter...Little by Little

Taken by themselves, the above announcements may have seemed more evolutionary than revolutionary, but look at them within a broader scope and you can see a pattern beginning to develop. In this transitional period from Web 2.0 to Web 3.0, we're starting to see tools and services that aim to expand upon the traditional search experience in order to deliver us to a more intelligent web. On this new web, we're moving beyond SEO and PageRank to determine relevance and instead are seeing new technologies develop that better understand meaning, context, and personal preferences.

Stayed tuned...part 2 of "The Smarter Web" will continue tomorrow.

"For each of the near term reporting requirements (major communications, formula block grant allocations, weekly reports) agencies are required to provide a feed (preferred: Atom 1.0, acceptable: RSS) of the information so that content can be delivered via subscription."

While the document states that agencies are not expected to develop new sites, each agency must dedicate a page of its primary site to stimulus activities, and the pages must be up by February 25, 2009.

Here at ReadWriteWeb, we have always maintained that the new government is leading the way with openness and transparency, and once again we must give kudos to the new administration in bringing the true meaning of Web 2.0 to the government.

The goverati includes not only government employees, but also people from think tanks, trade publications, and non-profits. And it includes high-profile thinkers outside of the government who have an interest in a more open, transparent, and efficient government; people such as Joe Trippi, Craig Newmark, and Tim O'Reilly. Using formal and informal social networks, the goverati is networking, sharing information, and changing how parts of the government interact with each other and with citizens.

About a week ago, President Obama issued a memo on this very topic. The memo, which affects all Executive Branch employees, has three main pillars: government should be more transparent, participatory, and collaborative. Social software will be part of an overall strategy to make this happen, spearheaded by the CTO, the Office of Management and Budget (OMB), and the General Services Administration (GSA). The naming of a "New Media" czar, Macon Phillips, will no doubt push the process along and keep branches well informed.

There are many barriers to this kind of change, so many they would be overwhelming to list. But the changes that are happenening are being covered by the mainstream press, and they are being enacted mainly by -- you guessed it -- the goverati.

Case in point: webmasters. Numerous policies and customs restrict the government's use of things like commercial websites to host video and cookies to track visitors. Insiders from across the government have written a number of white papers that explain the problems (without using jargon) and outline reasonable solutions (here's one of those white papers).

Former CIO of the Department of Defense, Dr. Linton Wells II, often comments to me that battles in government are often won by the most persistent. And the goverati are certainly persistent. It knows that momentum and timing are on its side, and it is pressing its agenda on Washington.

But changing the government is not like changing Apple Computer. President Obama issuing a directive is not the same as Steve Jobs issuing one. It simply doesn't work that way, for all kinds of reasons. To change government, you must be persistent, have a hook, and know when and how to leverage connections and power to "muscle" change. And there are usually competing factions, outside interests, political seasons, etc.; it's a very delicate business.

But interestingly, just as the goverati is fighting for a more transparent, participatory, and collaborative government, it is also leveraging the social tools it loves so much to become a body more powerful than the sum of its parts. The informal Government 2.0 social network GovLoop was developed by a DHS employee in his spare time; in a few months, it has surged to over 5000 members. Intelink, the intelligence community's internal social network and information hub, is awash in blogs and other communication about the topic. Events are sprouting up everywhere, most notably non-profit ones planned by insiders and advertised primarily by word of mouth.

The Sunlight Foundation, which uses the power of the Internet to shine light on the interplay of money, lobbying, and government, is hosting an unconference in late February called Transparency Camp, in which open-government advocates from all walks of life (tech, policy, non-profit, etc.) can talk across organizational and party lines in a casual atmosphere about new strategies for goverment transparency. It is sold out. This is exactly the kind of event you can expect the goverati in Washington and elsewhere to be holding in the next year as we transform President Obama's memo into a reality within government.

Closer to home, three partners and I have recently established the Government 2.0 Club, modeled on Social Media Club. Government 2.0 Club will bring together thought leaders in government, academia, and industry from across the country to explore how social media and Web 2.0 technologies can create a more transparent, participatory, and collaborative government. Local "Clubs" will hopefully also sprout up to discuss issues specific to them. And the first Government 2.0 Camp is happening in Washingston in late March.

The excitement over new social technologies has not abated in Washington. Change is indeed on the way. The intriguing part is the mechanism by which it is happening. By using these social tools to network and share information among themselves, the goverati is helping to spread the use of these very tools throughout the government.

Dr. Mark Drapeau is a biological scientist, government consultant, and author. He has a B.S. and Ph.D. in animal behavior, conducted postdoctoral research on complex genomic and neural systems, and has published writing in Science, Nature, Genome Research, American Scientist, the New York Times, the Washington Times, and other venues.

Like an increasing number of private companies, Blurb is starting to report its financial results publicly, almost as if it were a public company. This presumably serves the purpose of both reassuring customers that the business is healthy and attracting potential acquirers.

Allow us to quote shamelessly from Blurb's press release (at least it prevents errors):

"Blurb, the creative publishing platform, today reported a year of record growth in 2008 with revenues approaching $30 million. The company reached profitability and achieved nearly 200% year-over-year revenue growth in 2008."

Quiz: which would you prefer: a company with $200 million in advertising revenue that is burning cash, or a business with $30 million in subscription revenue that is profitable? The first describes Facebook, the second describes Blurb. Yes, it is almost absurd to make the comparison. But the point is that old business maxim: revenue is vanity, and profit is sanity.

What Does this Tell Us About the Economy?

On the face of it, not much. Blurb's business is partly seasonal; people buy more during the holiday season. We asked Eileen Gittins, the company's CEO. She sounded almost surprised, not at all triumphant, and generally cautious. Which is a reasonable reaction of anybody doing fairly well in today's economy. Eileen confirmed that January is also looking good: 30% over projections. So this is not just a holiday buying story; it's more about what specifically Blurb offers.

What Does this Tell Us About Blurb's Market?

Eileen attributed the good results to three factors:

1. Pent-up demand to write books. Who doesn't have a book they have always wanted to write? It is now easier than ever to publish (if not write) a book.
2. The cultural shift of people becoming more active contributors to media, as writers as well as readers.
3. The forced leisure that layoffs create, and the desire to do something that one has some control over and can point to as an achievement. This may be exacerbated by the bad times: get laid off from a big job, take three months to write a book about what you know, do it well and you'll be back in demand pretty soon.

There is one simpler explanation that we see. In tough times, affordable luxuries that provide a high level of emotional satisfaction do well: think movies, roses, and booze.

But we're clearly now at a point where the financial problems of the world will have a big impact on where web technology is headed. Indeed, it looks like we've arrived at one of those giant inflexion points - where one web era is usurped by another.

Of course this last happened when Web 2.0 was coined by O'Reilly Media in about 2004. Luckily not long before that ReadWriteWeb was born (early 2003). So ReadWriteWeb has been documenting Web 2.0 ever since. Over the past couple of years, we've been focusing on other, perhaps more meaningful, trends - Semantic Web, recommendation technologies, websites becoming web services, Mobile Web and more. We've documented these meta trends in a number of big posts, some of which are in our Best of ReadWriteWeb page and copied here:

• Web Technology Trends for 2008 and Beyond
• What's Next on the Web: a ReadWriteWeb Toolkit for 2008
• 2008 Web Predictions
• 10 Future Web Trends
• 10 More Future Web Trends

The Welcome Return of Innovation

Although we'll continue to see the success stories of Web 2.0 grow and perhaps prosper - social networking, mashups, user generated content, etc - now is the time for innovation. I'm not stating anything revolutionary there, because it's an old cliche that tech innovation thrives in times of recession. Nat Torkington of O'Reilly Radar put this into the context of Web 2.0 recently:

"During boom times, companies direct development and occupy great talent with at best evolutionary improvements over the state of the art. Companies are great chasers of new things, but aren't great at making new things. A recession means technologists cease to be paid vast amounts to duplicate the work of others. The Great Tech Bust of Ought Two gave us 37Signals, Flickr, and del.icio.us and there's a strong argument to be made that many companies spent the next six years chasing what they created."

So we can expect to see a welcome return to web innovation in 2008/09, along the lines of what Flickr and 37Signals created back in the early days of Web 2.0. However, web entrepreneurs will need to make adjustments due to the economic climate. Many people have already noted that a re-focus on the bottom line of your business is key, which we discuss below. But perhaps just as importantly, as Nat pointed out, there is an opportunity to take more advantage of open source technologies and cheaper cloud computing infrastructure.

Yes, Tighten Your Belts, But Open Your Minds Too...

In the past week some high profile VCs have been preaching belt tightening as the primary response to the economy. More than a few people have expressed cynicism about this advice, given the hype and party-throwing days of Web 2.0. New York VC Fred Wilson wrote a post today, partly in response to a comment Bernard left on his blog, in which he defends the advice he and other VCs have been giving since the financial crisis got going. Basically that advice has been to batten down the hatches, reduce spending and, in Fred's words, "act responsibly and make sure we all survive to fight another day".

It's all common sense advice, especially since Web 2.0 has been predominantly about consumer apps. I'm certainly no economist, but it makes sense that in a tight credit market, consumer spending will reduce - which will impact heavily on consumer web apps, and trickle through to other parts of the ecosystem.

But I'd love to see technologists, entrepreneurs and VCs take a longer term view of this crisis as well. Sramana Mitra wrote a great post at Forbes outlining some of the opportunities for innovation. In an "Open Letter to the Leaders of Silicon Valley", Sramana first gave some background on the innovation that led to Web 2.0 and followed up with a challenge to create technology for education, health care, social security. As an example, she wrote about these opportunities in healthcare and education:

"As the smart-phone movement marches on, led by Steve Jobs' iPhone, can we not create seamless bridges between doctors, patients and insurance providers that can reduce the $250 billion expenditure in health care administration?

And on the Internet, can we not create a body of standardized content and methodology for teachers all over the U.S.--or the world--that includes parents in the process and engages children via "edutainment," the same way MySpace and "World of Warcraft" engage kids?"

Tim O'Reilly has been on a similar mission ever since his speech at the Web 2.0 Expo earlier this year, for startups to tackle 'big challenges'. His core message is to "work on stuff that matters."

What's Next... Let Us Know in the Comments!

We at ReadWriteWeb have been covering mainstream web applications and things like health 2.0 this year. But we've only just scratched the surface, just as have most startups and Internet companies. As the troubles in the economy begin to affect the tech world, we'll be re-doubling our efforts to document what we hope is an exciting new era of web innovation. There are tough times ahead, but equally there are opportunities.

In the best spirit of Web 2.0, let's start by asking you to comment on what opportunities in web technology you forsee over the next year or so. Please leave a comment and let's get a healthy, optimistic - but realistic - discussion started. To provide a bit of inspiration, I've embedded below our stock presentation What's Next on the Web? Web Technology Trends for 2008 and Beyond (circa December '08).

Note: click here and then click 'full' (bottom right) to view full screen and enable the links inside the presentation.

Given the current economy, there may be fewer applications and services to try next year. Whatever will we early adopters do? We love to flit from service to service, trying the latest shiny new thing, endlessly discussing whether or not it will stick, whether it will "cross the chasm." Without the endless barrage of new services being released one after another, in 2009 we may find ourselves having to more deeply embrace the ones we have left. More importantly, we'll finally have the time to figure out how we can really integrate them (or not) into our daily lives.

As we discover how to better manage the social media apps we added to our daily workflow during 2008, we may end up turning a more critical eye towards any newcomers in 2009. Enriched with a better understanding that doesn't come just from being enamored of "shininess," but from experiences that grew over time, we may question the new arrivals in ways we never did before. What value does this bring me?, we'll ask. Is this really doing anything new?

Thankfully, the answer to that last one will likely be "yes," as the funding possibilities for straight up clones of popular services will probably be dialed back in 2009.

What We Want in 2009: Help Us Manage Social Media Better

For the entrepreneurs still looking to get our attention with the latest social media toys, their pitch may no longer be "come try this, it's new," but instead, "come try this, it helps." Because if there's anything we learned from 2008, it's that social media overload is not sustainable.

Over the course of the past year, we found ourselves drawn to the apps, services, and features that helped us better organize the madness that is information overload. We added our friends to lists in both FriendFeed and Tweet Deck, we categorized our RSS feeds and even cleared out some for good, we de-friended the strangers we had collected on Facebook, we synced our social network friend lists, and we found ways to multi-post to our preferred networks. Yes, we became more efficient..but there's still so much room for improvement.

Our Social Media Wish List

Perhaps next year, we'll see more apps that help us better organize, if not filter, the information we deal with every day. We have some thoughts about what we would like to see and we hope that 2009 will bring these ideas to fruition.

• Google Reader add-ins and/or Greasemonkey scripts:We want Labs for Google Reader! It seems Google is more interested in revamping the Reader UI than giving us any real tools to deal with our RSS overload. If they won't help, then someone else should. We would love to see tools that let us view our feeds based on our attention data, without having to manually reorganize the feeds ourselves. We also want duplicates marked as read - if we read a friend's shared item from a feed we subscribe to, why do we have to see it again as we plow through our unread feeds? Finally, we need tools that let us better filter our subscriptions to reduce noise. Why can't we click a button to hide all the posts where someone has spliced in their delicious links or Twitter updates, for example?
• Auto-categorization tools: We tried to emulate Robert Scoble and what did we end up with? Only several thousand friends whose updates fly by at the speed of light. We tried to organize them into lists, but do you know how long that takes?! What would we would like to see are tools that organize people for you. Is it really so hard? The tools could parse our friends' Twitter profiles, for example, to categorize people based on location, business, or company. All the local people could be in one list. Everyone whose profile says "SEO" in another. Anyone in the top 50 or 100 users (based on followers/friends) in a third list called "noteworthy." Just because we want to customize and personalize our lists doesn't mean we couldn't use a little help getting started with the task.
• More Friend Synchronization tools: We want to friend you - really we do - but it's hard because you're here and there and everywhere. To make matters worse, you don't even use the same username on Digg as you do on Twitter. How will we ever find you? What we want is a tool that allows us to friend people, with one click on all the networks we possibly can, according to our preferences. It should also be able to delve into our social graph and sync up the friends we have already added.
• Friend List Sanitizers: OK, we followed/friended you, but we don't know why. We don't know you, we don't have any friends in common, in fact, we think you might have requested our friendship by mistake. So why are you still in our Facebook friends list? We need tools that help us clean up our lists to remove the accidental "stranger friendings" left over from our MySpace days. Even better, the tool could compare our Facebook list to our FriendFeed or Twitter friends to see if we know you elsewhere in order to determine whether to retain or remove the friendship.

These are just a few social media tools we would like to see developed in 2009. What are yours?