The latest internet buzzword encompasses an egalitarian vision of the World Wide Web that’s more reliable, based on trust, and inevitably, built on the blockchain. This plan is being bolstered by startups, venture capitalists, and Silicon Valley titans, all of whom stand to amass a crypto fortune from web apps that could transition the power from platforms like Apple, Google, Amazon, Meta and put it back in the hands of the people.
The metaverse and Web3 are two nebulous concepts in which internet services are rebuilt around blockchain and cryptocurrency and at this point are more marketing than reality. Currently, the “metaverse” is mostly a branding exercise for a series of virtual worlds, some of which are dependent on virtual reality (VR) headsets to access. Critics point out that we’ve basically tried all this technology before, with the failed VR boom of the ‘90s and the rise of spaces like Second Life in the early 2000s. What this current iteration primarily offers is improved hardware, a flashy new title, and billions of dollars of backing from giants like Facebook-owned Meta, keen to control what they see as the next big digital platform.
Elon Musk’s criticism of the metaverse focuses on a lack of compelling use-cases and a disappointing experience for consumers. “Sure you can put a TV on your nose. I’m not sure that makes you ‘in the metaverse,’” he said.
“I don’t see someone strapping a frigging screen to their face all day and not wanting to ever leave. That seems — no way.”
He later added: “I currently am unable to see a compelling metaverse situation.”
Web3 is another alternative vision for the future of the internet, driven by the idea that ordinary internet users will be able to directly profit from their content and activity online (rather than having this value captured by a few behemoth internet companies).
Tech CEO Jack Dorsey said that Web3 won’t democratize anything but will simply shift power from existing incumbents like Facebook to upstart venture capital funds like Andreessen Horowitz. Andreessen Horowitz (a16z), a Silicon Valley venture capital group, is betting on crypto to break up the excessive concentration of Big Tech power that the firm played a prominent role in creating.
Chris Dixon, founder of Andreessen’s crypto arm, said the internet we know today has led to power being held by a handful of companies including Facebook and Twitter,
“I don’t think that any of us expected this level of concentration,”
“I don’t think this is a good outcome, both societally and from a business point of view, because our business is investing in entrepreneurs . . . the idea of having the internet controlled by five companies is very bad for entrepreneurs and bad for VCs.” His comments come as the firm is seeking to hone a new investment strategy built around cryptocurrencies and digital tokens to replace the traditional equity investments made by VC firms and create a new, community-led model for investing in high-growth start-ups. Proponents of the Web3 movement claim decentralization will shift the balance of power away from centralized platforms and towards users.
“Any regulator that stops the next generation of artists, musicians, and game developers from owning their platforms and their work is going to go into the wastebasket of history as a villain.” ~ Naval Ravikant
Web 1.0
In 1989, Sir Timothy John Berners-Lee an English computer scientist working as a researcher with CERN one of the world's largest and most respected centers for scientific research pioneered the early development of the internet, originally conceived and developed to meet the demand for automatic information-sharing between scientists in universities and institutes around the world.
Berners-Lee had written the three fundamental technologies that became the foundation of the web, including the very first webpage editor/browser (WorldWideWeb.app):
By the mid-1990s, the introduction of web browsers such as Netscape Navigator ushered in the era of Web 1.0. This was the age of static webpages retrieved from servers—a far cry from the slick content that is taken for granted today. Most internet users at that time were delighted by the novelty of features such as email and real-time news retrieval. Content creation was still in its infancy, and users had little opportunity for interactive applications, although this improved as online banking and trading became increasingly popular.
Web 2.0
Web 2.0 refers to a paradigm shift in how the internet is used. Over the past 15 to 20 years, the bland webpages of Web 1.0 have been completely replaced by Web 2.0’s interactivity, social connectivity, and user-generated content. Web 2.0 makes it possible for user-generated content to be viewed by millions of people around the world virtually in an instant; this unparalleled reach has led to an explosion of this type of content in recent years.
The exponential growth of Web 2.0 has been driven by key innovations such as mobile internet access and social networks, as well as the near-ubiquity of powerful mobile devices like iPhones and Android-powered devices. In the second decade of this millennium, these developments enabled the dominance of apps that greatly expanded online interactivity and utility—for example, Airbnb, Facebook, Instagram, TikTok, Twitter, Uber, WhatsApp, and YouTube, to name a few.
The phenomenal revenue growth of these dominant platforms has made many of the Web 2.0-centric companies—such as Apple, Amazon, Google, Meta (formerly Facebook), and Netflix among the world’s biggest companies by market capitalization.
These applications have also spurred the growth of the gig economy, by enabling millions of people to earn income on a part-time or full-time basis by driving, renting their homes, delivering food and groceries, or selling goods and services online. Web 2.0 has also been tremendously disruptive to certain industries to the point of being an existential threat to some of them. These are sectors that have either failed to adapt to the new web-centric business model or been slow to do so, with retail, entertainment, media, and advertising among the hardest hit.
Web 3.0
Web 3.0 represents the next iteration or phase of the evolution of the web/internet and potentially could be as disruptive and represent as big a paradigm shift as Web 2.0 did. Web 3.0 is built upon the core concepts of decentralization, openness, and greater user utility.
Berners-Lee had expounded upon some of these key concepts back in the 1990s, as outlined below:
Decentralization: “No permission is needed from a central authority to post anything on the web, there is no central controlling node, and so no single point of failure...and no ‘kill switch’! This also implies freedom from indiscriminate censorship and surveillance.”
Bottom-up design: “Instead of code being written and controlled by a small group of experts, it was developed in full view of everyone, encouraging maximum participation and experimentation.”
In a 2001 paper, Berners-Lee discussed the concept of what he referred to as the Semantic Web.Computers have no reliable way to process the semantics of language (i.e., figure out the actual context in which a word or phrase is used). Berners-Lee’s vision for the Semantic Web was to bring structure to the meaningful content of webpages and enable software that would carry out sophisticated tasks for users.
Web 3.0 has moved well beyond the original concept of the Semantic Web as conceptualized by Berners-Lee in 2001. This is partly because it is very expensive and monumentally difficult to convert human language—with all its subtle nuances and variations—into a format that can be readily understood by computers, and because Web 2.0 has already evolved substantially over the past two decades.
Defining Features of Web 3.0
Though there is yet no standardized definition of Web 3.0, it does have a few defining features:
Decentralization: This is a core tenet of Web 3.0. In Web 2.0, computers use HTTP in the form of unique web addresses to find information, which is stored at a fixed location, generally on a single server. With Web 3.0, because information would be found based on its content, it could be stored in multiple locations simultaneously and hence be decentralized. This would break down the massive databases currently held by internet giants like Meta and Google and would hand greater control to users.
With Web 3.0, the data generated by disparate and increasingly powerful computing resources, including mobile phones, desktops, appliances, vehicles, and sensors, will be sold by users through decentralized data networks, ensuring that users retain ownership control.
Trustless and permissionless: In addition to decentralization and being based upon open source software, Web 3.0 will also be trustless (i.e., the network will allow participants to interact directly without going through a trusted intermediary) and permissionless (meaning that anyone can participate without authorization from a governing body). As a result, Web 3.0 applications will run on blockchains or decentralized peer-to-peer networks, or a combination thereof—such decentralized apps are referred to as dApps.
Artificial intelligence (AI) and machine learning: In Web 3.0, computers will be able to understand information similarly to humans, through technologies based upon Semantic Web concepts and natural language processing. Web 3.0 will also use machine learning, which is a branch of artificial intelligence (AI) that uses data and algorithms to imitate how humans learn, gradually improving its accuracy. These capabilities will enable computers to produce faster and more relevant results in a host of areas like drug development and new materials, as opposed to merely targeted advertising that forms the bulk of current efforts.
Connectivity and ubiquity: With Web 3.0, information and content are more connected and ubiquitous, accessed by multiple applications and with an increasing number of everyday devices connected to the web—one example of which is the Internet of Things.
Potential and Pitfalls of Web 3.0
Web 3.0 has the potential to provide users with far greater utility, going well beyond the social media, streaming, and online shopping that comprise most Web 2.0 applications consumers use. Capabilities like Semantic Web, AI, and machine learning, which are at the core of Web 3.0, have the potential to greatly increase application in new areas and vastly improve user interaction.
Core features of Web 3.0, such as decentralization and permissionless systems, will also give users much greater control over their personal data. This may help limit the practice of data extraction—which refers to information collected from web users without their consent or compensation—and curb the network effects that have enabled the technology giants to become near-monopolies through exploitative advertising and marketing practices.
However, decentralization also brings with it significant legal and regulatory risks. Cybercrime, hate speech, and misinformation are already difficult to police and will become even more so in a decentralized structure because of the lack of central control. A decentralized web would also make regulation and enforcement very difficult; for example, which country’s laws would apply to a specific website whose content is hosted in numerous nations globally?
The Bottom Line
Just as the 2010s were the decade when Web 2.0 became the dominant force in the global business and cultural landscape, it might be Web 3.0’s turn in the 2020s. Facebook’s name change to Meta on Oct. 28, 2021, could well turn out to be an early sign that the shift to Web 3.0 has begun. The steam engine, electricity, the microchip – blockchain and Web3 could be the fourth industrial revolution.
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