Internet – Phase 3?

Internet's 3rd Phase?

Is the development of the internet entering a new 3rd phase? I think so. And curiously, this phase is driven by credit and business needs not technical developments.

In the first phase – pre 2001 – the Internet was the modern equivalent to the goldrush. Lots of people were selling up and going for broke. Lots of these people broke down on the way, lost everything and made a real hash of it. But whilst this phase did burn a lot of money it still make some unknown people multi-millionaires. Some temporary, other permanently.

Equally, this first phase was the stage during which the infrastructure was laid down – domain rules were set, cables buried beneath streets, broadband was developed – but not yet distributed.

Phase 2 began after the 2001 tech bubble burst. During this second phase the internet went into a maturing phase and we saw proper development of internet marketing service companies. Pay per click became established and videos moved online too.

During this phase we saw You Tube sell for mega bucks and Google become a massive company with a worldwide brand. However, we also saw a lot of boutique and home businesses get established offering web design, writing and marketing/ SEO services.

We also heard the talk and early experience about web 2.0 – where the users create the content. This has morphed into Social Media – where the users ARE the content – the site is simply a bunch of tools hung together under a (trusted?) brand.

We also had the disappointment that most user generated content is rubbish and realisation once more, that there is no such thing as a free lunch. You can’t put up a webpage and expect millions of people to find it or even to contribute anything but self promotion and spam UNLESS you invest hours and hours of editorial management and development.

In this 2nd phase collaborative tools were developed online, but like broadband before, they were not widely distributed. And just as broadband became universally available and widely distributed in the 2nd phase, so social media and collaborative tools will do the same in phase 3 on the internet.

Phase 3 began with the global credit crunch in which business models collapsed and all businesses began searching for new and cheaper ways to find customers and do business. Hence, they are naturally turning to the internet.

This 3rd phase is killing local newspapers as we all search online or LinkedIn for our next job and no one pays for job advertising anymore.In this phase we are seeing the splintering of google’s control as we have ‘knowledge engines’ to go alongside search engines and a large number of niche based websites will be created and will achieve success – there are enough users online these days. Google will become the lumbering giant that Microsoft once was in phase 1 as new concepts of search and information/ ideas delivery bite into their marketshare.

Success will finally come to small online media owners, because advertisers are now willing to go online too! But, these small publishers will probably band together to form a bigger firms as they seek to use size to leverage their results or seek to use the outsourced media sales and publishing services.

The key factor in this phase is workers collaborating online as never before. This removes the need for rigid job roles and we will all become – essentially – freelance. This suits the company too – as they need to reduce their fixed costs following the 2008 meltdown in finance.

The internet business to build, in phase 3, will be an online networked business of freelancers. Overheads will be close to zero and this will allow the successful companies to build fat profit margins. Like all phases before, this will sound easy – whereas it is not – and will require dedication and focus to ensure success. In particular, the issue will not be how to attract freelancers but how to retain them and therefore keep their knowledge and experience of your markets alive and available to your business.

That, though, is a business challenge rather than a technical one. Albeit, one that needs to intimately understand the opportunities offered in this new and exciting 3rd phase of the internet.