Will Users Bring Down Web2.0?

Written on
Jan 2, 2008 
Sarah Novotny  |

arrowdown.jpgCEO of Strategic News Service, an online newsletter that predicts the success of communications companies, Mark Anderson was recently quoted in the Telegraph to say that websites offering free products in exchange for targeting users with advertising will fail at a 9:1 ratio.

He continued to say that the tolerance for intrusion and capitalization of personal information for advertising has gone down. Anderson stated in an interview on BBC World Service to “Note the very humble pie apology from the founder of Facebook – terrified that in fact he might lose his entire franchise because he made a mistake with a new advertising product called Beacon.”

Although one of the latest trends in online advertising is investing in social networks, Anderson thinks that “There are more names than money so far. There are many more Web2.0 companies out there than will ever survive. We’ll see a lot of those companies failing this year.”  The failure is coming from the reliance on advertising and a universal acceptance of it. There is a tipping point to everything, and for Web2.0 firms the time just may have come for theirs.

Sarah Novotny is a contributing editor at Adotas. Sarah grew up in San Jose, California. Her educational and professional career have taken her to both Los Angeles and New York City where she received a B.F.A. from NYU. As a writer, Sarah has free-lanced for various publications focusing primarily on traditional advertising and media reviews. When not writing and editing for Adotas, Sarah is continuing her acting career in various theatrical and film/television productions.

Reader Comments.

I love how they throw around the term Web 2.0 like its a niche of “firm”, but never specify wtf they’re actually talking about. Web 2.0 encompasses everything from simple clean code, to design trends, to funny names, to business plans, and has signified an “upgrade” in web software across the board in just about every industry. There will be no Bringing Down of Web 2.0- only a shakeout period and a refined Web 3.0 bandwagon to jump on. 9:1 ratio? please, new free sites are going to sell out to bigger ad pasting companies for the rest of time.

Posted by snowboardfoo | 4:33 pm on January 2, 2008.

Thats an interesting stat but free services in exchange for ads is not a new or ’2.0′ concept and many have failed along the way, from to Claria which may not be bust, but is not as visible as it once was.

The number of failures also highlights the sheer number of startups that are seeking advertising income as their principle income source, with little or no substance or thought as to how the numbers really shake out.

So this is not a surprise, but its not a cause for concern either.

Posted by Jamie Riddell | 8:13 am on January 3, 2008.

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