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Web 2.0 lacks the business impact of SOA, Burton warns

The hype around Web 2.0 is justified for devotees of MySpace and fans of wikipedia, but there is no good business model for its adoption by corporations, say analysts at the Burton Group.

Web 2.0 is great for people seeking a friendly online community, but in the bottom line world of business the best plan is to stick with service-oriented architecture projects with the potential to make money.

I don't think there's a good business model for Web. 2.0.
Richard Monson-Haefel
Senior AnalystBurton Group Inc.

That was the concluding caveat offered by Richard Monson-Haefel, senior analyst at Burton Group Inc., this week in a telebriefing entitled, "Web 2.0: An Architecture of Participation." He defined Web 2.0 as applications using Ajax and rich Internet application technology to allow end users to actively participate in creating content for a Web site. However, the irony of the title was the analyst's caveat that corporate IT departments do not have much place for participation in Web 2.0.

"I don't think there's a good business model for Web. 2.0," Monson-Haefel told his listeners. However, corporate developers may find ways to make use of individual Web 2.0 applications, such as wikis and blogs, for internal use inside their organizations, he said. But he does not see a way that a developer or architect would make a convincing case for a profitable Web 2.0 application unless they are in the social networking business or have a business plan for starting the next YouTube.

Monson-Haefel borrowed Alan Greenspan's epithet for the 1990s high tech bubble to characterize the excitement surrounding Web 2.0 as "irrational exuberance."

"Expectations are just too high," Monson-Haefel told his listeners. "I think it's fairly obvious by now that we're seeing way too much investment and way too many startups around the Web 2.0 theme at this point. It really hasn't been fleshed out what's going to work and what's not going to work. Unfortunately, I think we're going to see some negative impacts on that."

Monson-Haefel was not saying the Web 2.0 isn't a viable paradigm, just that "the business translation is not clear." It is valuable for IT professionals to know about it, but it probably isn't something they should put on their to-do list.

He noted that the popular Web 2.0 sites such as MySpace operate on the basis of "functional anarchy" where people with divergent points of view, interests and tastes find modes of expression for their creative endeavors or inner passions. But embracing and furthering anarchy on the Web is probably not one of the goals of most CTOs, since most businesses are not comfortable with chaos, he observed.

Craig Roth, a Burton analyst covering collaboration and content strategies, joined the telebriefing to question the popularization of the term "Web 2.0." He said he was not comfortable with the borrowing of the 2.0 designation, which once was reserved as a notation in software versioning. In his view Web 2.0 represents marketers hijacking a term that was once and may still be meaningful to software developers.

"When I see something labeled 2.0 it means something to me," he said. "I think of a piece of software that's been released. Things tend to stay in beta forever now it seems. But eventually by the time they get to 1.0, they're fairly solid. By the time you get to the 2.0 version, usually you have a definite set of features. There's a discrete stepping stone between version one and version two. For Web 2.0, I don't know that any trigger has been tripped that says we are exactly at 2.000 on the Web."

Monson-Haefel disagreed.

"My feeling is that whether you like the name or not, it's there," he argued. "And it has stuck. When the Ajax name came out, a lot of people who had been doing Ajax-style applications for a while really didn't like the name, but now everybody uses it. Web 2.0 as a moniker has reached a certain level of popularity. It doesn't really matter whether you agree with the name or not, but I see Web 2.0 as being a very appropriate moniker for a new paradigm."

Monson-Haefel said there have been three versions of the Web, Web 1.0, Web 1.5 and now Web 2.0. He defined Web 1.0 as the early brochure-ware stage with the Internet used to serve up static HTML pages. Web 1.5 was the next step where more sophisticated content, graphics and transaction processing were "dynamically generated on the server side." Web 2.0 provides architectures of participation where a community of users can place content ranging from text to audio and video onto the Web site.

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Roth argued that one of the problems with the 2.0 designation was that it implies technology "with concrete poured around it." He sees the possibility that rather than remaining static, the technology for what is termed Web 2.0 may be rapidly evolving beyond the popular notion that it is mostly about wikis and blogs.

Following up on Monson-Haefel's caveat that Web 2.0 doesn't have a "business translation," Roth said the 2.0 designation may mislead organization into thinking that it is stable technology that they should be adopting the way they once adopted Word 2.0.

"Don't let the 2.0 fool you," Roth warned, "this is still something that's evolving rapidly. We're still trying to learn the business models around it. It's not something that's ready for primetime unless you're willing to accept some risks and know that you are going a bit out on the edge."

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