At the best of times the internet is a mess of bizarre acronyms, weird forecasts for the future and outright disinformation.
This post falls into the first two categories!
We are going to take a look at Web 3.0 and decentralization. What does it all mean? Are they both linked? Is it all a load of rubbish? And what, if any, effect will these new digital trends have on commerce in the future?
Let’s dig in!
The Timeline
But before we look forward, we should examine the various iterations of the internet that we have seen so far. As Maya Angelou once said “If you don’t know where you’ve come from, you don’t know where you’re going.”
Web 1.0? A Static & Decentralized Internet Is Born
Back in the mists of time, well the 1990’s, the first iteration of the internet was born.
People were told by techno-utopians that the internet would put the world’s information at their fingertips. In certain parts of the world, it did just that. But in the early 1990’s the internet was, for most, a curiosity that was tailored to the tech savvy audience.
Web 1.0 was a static, read-only experience outside of certain niches like Usenet newsgroups. But Web 1.0 had the pioneering spirit of “freedom” and decentralization. The promise of a new digital future was there, but it was not accessible for most.
However things were about to explode. David Bowie, in a prescient BBC interview in 1999 said “What the internet is going to do to society, both good and bad, is unimaginable. We are on the cusp of something both exhilarating and terrifying.”
Web 2.0? A Dynamic & Consolidated Internet With eCommerce
Not for the first time, David Bowie was right.
Around the mid-2000’s the internet was very different. Web 2.0 had arrived! Search was far better than it was (Google is born..) which meant that people could find what they wanted, quicker. People could also interact and share content in new ways. User-generated content started to become “a thing”. Which brought a publishing dynamic that, arguably, we still have not got to grips with.
With the advent of search, eCommerce grew. This evolution of eCommerce helps to consolidate power in the hands of Silicon Valley.
Here lies the paradox at the heart of Web 2.0.
The internet loses some of its initial, decentralized dreams with Web 2.0. On the one hand by the time we reach 2010, more people have access to the internet than ever before. People have better access to faster connections and networks. Smartphones become cheaper and more popular.
On the other hand, power has become more centralized. Yes, users can create and share content. We have personalized experiences that can serve needs at the moment we have them (and predict needs that we do not know about yet). But true power is in the hands of the few. Companies like Google, Facebook and Amazon dominate the digital landscape.
What Is Web 3.0? A Semantic Web That Is Decentralized?
Web 3.0 is, according to some, the next evolution of the internet. But at this point, no one actually knows what that really means.
You can ask ten people “What is Web 3.0?” and you will get eleven different answers. One of those answers will try to get you to buy Crypto. Another may talk about the semantic web or Blockchain. At this point, the promise of Web 3.0 feels more important than the specifics of it.
For example you may be thinking about the “metaverse”. It is definitely true that the ingredients for its success are there. 5G brings rapid connection speeds and access to cheaper, better quality VR headsets means more immersive forms of content may become more popular.
However, that is still just speculation and forecasting. Is Web 3.0 really just a “ready player one” style future of VR headsets so we can ignore real world problems?
Web 3.0 is supposed to be about decentralization, the hope of a return to the dreams of Web 1.0.
Most people seem to agree that Web 3.0 is more user-specific, privacy focused with the vague promise of some form of “internet democracy”. Even if we do not know the specifics of how that will take shape just yet, that’s the driving philosophy of Web 3.0 and decentralization.
But what does that mean for us right now? And more pertinently, is it actually true?
What Is Decentralization In the Context of Web 3.0?
Decentralization in the context of Web 3.0 means shifting power back from platform holders to the user.
Ideally data should be owned by users and managed with smart contracts. But “ideally” is the correct word here.
Can we really see the likes of Google, Meta or Amazon ceding control of data back to the user? Spoiler alert…They will not. In fact Silicon Valley is already well positioned to be in control of parts of the blockchain infrastructure.
Are There Other Problems Ahead?
Web 3.0 does have some other issues that may hinder its development. Some of these issues make it incredibly difficult for businesses to even consider a Web 3.0 strategy right now. These issues include:
Regulation Is Nowhere Near Robust Enough For Web 3.0
The crypto space alone has had problems with scams and criminal activity. At the moment there is no regulatory, legal framework to adequately deal with a decentralized Web 3.0.
Cost Of Upgrading To Web 3.0
This still deals a bit with the general uncertainty around what a decentralized internet might actually be. But all businesses can know at this point is that it’s likely to be expensive to upgrade. For example if we are all shopping in a virtual reality, brands and platforms have to develop a secure infrastructure that facilitates that.
How You Actually Upgrade & Develop For Web 3.0
If for example, the above costs do not put a business off then the lack of proven third-party tools to help build your Web 3.0 app almost certainly will. Your application may also depend on the blockchain you are building on; if there are problems with that your app will have problems.
Why Bother?
This is a simple question but an accurate one. The technology behind Web 3.0 is incredibly powerful. But it’s also expensive. Has the best use for it really been discovered yet? Japan’s largest financial group, MUFG, recently abandoned their blockchain project stating “commercialization of the product is expected to take longer than anticipated.”
But decentralization is in and of itself not a bad thing. In fact, using technology as a base for decentralizing businesses could be the most exciting application of Web 3.0 technology.
Just because there are problems now does not mean they cannot be overcome in the future.
In part 2 of this series we will look at DAOs and what they might mean for businesses. Come back soon for that!
What Does Web 3.0 Mean For Commerce?
At the moment, commerce will endure. It is too early to say exactly what this technology means for brands.
The future is inevitable though. For brands it is also, maybe, incredibly exciting.
eCommerce has iterated and thrived alongside the internet and the devices we use to access it. Web 3.0 could be a transformative phase where the online commerce experience is completely different from what it is now. Also if the idealists are correct, a decentralized future is a more competitive future.
While the likes of Amazon (and Alibaba) have dominated Web 2.0, a total transformation could mean going “back to the future”. Buyers and sellers could interact directly once again, without a third-party.
In this future, purchasing experience may be the true differentiator between sellers in the same niche. That is the element that commerce players should focus on. Build a powerful, engaging experience and you may find that Web 3.0 brings more opportunities than challenges.
Talk to MAQE
Does your business need to think about the future? Are you prepared for the next transformative phase of the internet? Talk to MAQE. We can help you create unique digital experiences now and help you adapt to whatever the future holds. Reach out via [email protected].