Openness, participation and scale: Web 2.0 rules of thumb

A large part of my horizon scanning research last year was on emerging communications and media business models. I needed to explain the main underlying trends likely to shape emerging value-chains and business models, so I came up with these three over-arching trends for ease of ‘conveying the message’ and to help retain the message:

Openness – socially, commercially and technically (standards and code) driving a culture of collaboration

Participation- the people formally known as the audience creating and co-creating, forming new connections and augmenting existing connections via social media and social networks online; and service providers facilitating interaction with their customer and the public

Scale - where location and size are no longer barriers to offering services or content online, challenging the scale advantages of mass media and telecommunications

Those three forces are driving growth and innovation in communications and media. My conclusion was that any communications & media business model that lacked those three drivers had a limited shelf-life.

Why am I posting this now? It was Vodafone’s move to “embrace open source with open arms”. I think this is biggie. Vodafone is a global mobile operator and from a sector that has strived to maintain control over what goes over their networks – such as Skype.  The EU is now on to that.

All well and good – my analysis is standing the test of time. But of course “it’s the economy stupid” applies as well. The global economic meltdown occurred afer I completed by research above and that factor has obviously caused Vodafone to re-think its strategy. No longer in a position to grow by acquisition, the company now accepts that “the only way to create a fertile environment for innovation is to have open platforms and leverage them”.

There is another twist as well. While reflecting on the Vodafone development, it occurred to me that the three over-arching drivers are applicable to individual netizens (consumers) and to instititutions generally as well as business.  To make the most out of the web, embrace the 3 x Web2.0 rule: openness, participation and scale. Of course there are major challenges to people and organisations taking up that challenge: the modus operandi for the 20th century has been one of control and acting independently.  Now we are in a century of co-dependence and collaboration – at least that is where innovation and growth is coming from. Perhaps a more apt phrase is “it’s the culture, stupid”.

For contemplation

Here are eight drivers of change that I propose for contemplation.

1.0       Digitisation, open, distributed, global connectivity is shifting power from institutions, governments and holders of intellectual property and copyright to individuals and social networks, and facilitating new and innovative applications development, new markets and consumer choice. Commoditisation & obsolescence of carriage networks leading to investment uncertainty are the likely consequences for incumbents.

2.0              The emerging social web will continue to have a democratising impact on media production, information and knowledge sharing. Social needs (status and self-esteem, self expression, affiliation, reciprocity) are increasing being met online. Networked individuals collaborate, create, reproduce and share content and information.

3.0              Acting globally is driving the need for networked and global capabilities. No one company can act alone to create all the innovations needed to keep pace in the digital economy. No one country can act alone to solve the e-security and privacy problems that are occurring in multiple jurisdictions.

4.0       Content & audience fragmentation and ‘content for free’ expectations threatens pay-for-content business models and holders of intellectual property rights. Media is fragmenting, driven by consumers also acting as producers and the expanding array of media platforms, channels and devices.

5.0       Symbiosis of mainstream media and social media is evident through mainstream companies purchasing social networking sites, and deepening content offerings with video and user-created content to augment proprietary content. Social networks will be of more interest to advertisers/marketers.

6.0              Relentless pace of change particularly in software and applications development that continue to be the primary drivers of innovation. Developments on the horizon include Web 3.0, intelligent software agents, embedded sensor networks & pervasive connectivity, voice recognition, mobile payments, augmented reality and wide-area free mash access networks. Climate change is a driver of innovation for sustainability.

7.0              New business model development incorporating collaboration, openness and modularised value-chains. Emerging business skills include a capacity for agility and responsiveness, building networked relationships (internal and external) and harnessing network effects. Collaboration taps into collective intelligence to adapt to complexity in the digital economy. Innovation can be decentralised to business partners that work in networks outside organisational boundaries. Incentives to the firm are in cost reduction (savings in time and effort) swifter innovation and retaining/improving brand reputation.

Services provided in the once distinct industries of media, telecommunications and computing are converging. There is a blurring of traditional communications and media industries with social media and computing.

8.0              Merging digital and physical identities and places becoming the norm through a blurring between virtual and real identities. Virtual experiences are becoming an increasing important means – and for some, the preferred means – to meet social needs. The mobile internet and emerging technologies such as intelligent agents, augmented reality, ‘the internet of things’ and embedded computing will blur distinctions between the physical and digital worlds.